Pros and Cons of Buying Land in Alaska

Alaska, known for its rugged beauty and abundance of pristine wilderness, has long attracted interest from outdoor enthusiasts and those looking to live closer to nature. With over 365 million acres of total land area, of which over 224 million acres are uncontrolled and undeveloped, the state offers ample opportunities for everything from remote homesteads to recreational properties. However, along with the appeal of raw Alaskan land come some important considerations. 

According to recent data from the Alaska Department of Natural Resources, the average cost per acre of vacant land rose over 8% statewide in 2023 compared to the previous year. Additionally, a report by the University of Alaska Fairbanks found that factors like lack of infrastructure, rigorous weather, and short growing seasons can make developing raw land in Alaska uniquely challenging, especially for first-time land buyers. As interest in Alaska real estate accelerates, it's important to weigh both the pros and cons of buying raw land in the state.

Some key advantages include abundant open space, privacy, investment potential and access to activities like hiking, fishing, and hunting. However, costs, infrastructure limitations, climate challenges, and complicated regulations should also be carefully researched before moving forward. Finding the right property that aligns with lifestyle and budget priorities is key in Alaska's complex real estate market.

Pros of Buying Land in Alaska

Abundant Land Availability

Over 90% of Alaska’s land is still entirely owned and managed by the state and federal government. Of the small percentage of land that is available as private property, much remains unclaimed and affordable for those seeking large acreages. It’s possible to purchase many acres of Alaskan wilderness for a fraction of the price such amount of land would cost in the lower 48 states. Remote properties with river frontage, mountain views and dense forests offer the Alaska dream at a reasonable cost.

Recreational Usage

The perceived isolation of Alaska lends itself perfectly to those looking for ample recreational opportunities right out their backdoor. Land owners can enjoy a plethora of cold weather sports and activities such as skiing, snowmobiling, mushing, ice fishing and snowshoeing for half the year. Warmer months welcome hiking scenic trails, rafting down rushing rivers, big game hunting and sport fishing for salmon or halibut. With most of the state accessible only by air, boat or rugged backcountry terrain, private land ownership opens the gates to adventure.

Natural Resources

Abundant natural resources have attracted settlers, pioneers and entrepreneurs to Alaska for centuries looking to tap into the state’s riches. Private lands may contain exploitable assets such as coal, gold, copper, zinc, oil and gas that could prove lucrative for land owners if leased to mining/drilling companies. Even land without actual commodity stores might profit from rights of way access across it granted to companies wishing physical access to drill sites or mining claims.

Tourism Business Potential

Owning acres of majestic Alaskan wilderness presents tempting opportunities to capitalize on the state’s booming tourism industry. Building a lodge, guided excursion or even just short-term vacation rental on a scenic piece of private property can draw adventure seeking visitors willing to pay premium rates for an authentic Last Frontier experience. The burgeoning ecotourism niche further expands prospects for land owners to attract guests while sustainably sharing Alaska’s natural splendor.

Cons of Buying Land in Alaska

Harsh and Unpredictable Climate

Outside of a handful of coastal regions in the south and interior regions around Fairbanks, the majority of Alaska experiences a subarctic climate that brings long, dark, freezing winters and short summers. While avid outdoors enthusiast may romanticize getting away from civilization in their own piece of the Last Frontier wilderness, the reality poses challenging conditions. Transporting building materials for development into remote areas proves difficult with a limited building season bookended by frozen or thawing ground conditions during spring and fall.

Unstable Ground and Permafrost

Related to Alaska’s northern climate, most of the state lies atop permafrost - ground that remains frozen year-round coming within a few feet of the earth’s surface. This firm foundation can become compromised when the upper “active” layers above permanently frozen ground melt and refreeze each year. Gradually this forms an unstable base for constructing buildings, roads, runways or other infrastructure which then becomes prone tofoundational damage from the freeze/thaw cycle.

Lack of Infrastructure

Private land far from Alaska’s limited road system or urban centers likely offers absolutely no utility access, cell coverage or emergency services. Property owners must be prepared to live entirely off grid by producing their own power, hauling water/fuel, utilizing satellite internet/phones and having supplies to last through long winters in remote conditions. This self-sufficient lifestyle appeals to some but proves mentally and physically demanding for most when cut off from civilization.

Risks to Buildings from Thawing Permafrost

As rising average temperatures driven by climate change accelerates the thawing of Alaska’s upper permafrost levels, built structures face escalating risks of foundations cracking or buildings collapsing as the ground shifts. Even structures erected on wood piles driven down to permanently frozen depths can experience warped, detached or broken supports as the “bearing capacity” of thawing ground around them lessens. Without proper environmental engineering preparations made upfront to account for thawing permafrost, property improvements remain vulnerable.

Restricted Access

While bush planes can reach remote areas of Alaska relatively easily compared to road access, flights prove expensive and weather dependent. Transport costs for building materials, fuel for generators, equipment, ATVs and snow machines quickly adds up relying solely on aircraft. Similarly, boat access depends on properly navigating rivers and lakes that freeze solid for eight months out of the year in Arctic regions. Coastal areas still face the challenges of dramatically rising and dropping tides. Depending on location, overland travel by snowmachine or ATV can only access private landholdings during winter and summer respectively.

Final Thoughts

For outdoor enthusiasts allured by wide open vistas and the promise of adventure, buying land in Alaska offers the ability to own a piece of the legendary frontier. Yet beyond the idyllic landscapes and picture postcard views lie challenging realities around harsh climate, remote access, lack of infrastructure and land instability that require substantial preparation and investment to overcome. As America’s last frontier, the state’s wildly beautiful lands ultimately favor and reward most those daring individuals determined and self-reliant enough to wander off the beaten path. Weighing out priorities, motivations and budgets plays a crucial role in determining if buying land in Alaska seems a risky venture or the chance of a lifetime.

Frequently Asked Questions (FAQs)

Is financing available for buying land in Alaska?

Financing land purchases in Alaska can be challenging as many banks are hesitant to lend for remote, undeveloped properties with limited road access or utilities. Buyers often need to explore alternative financing options such as seller contracts, hard money loans, or tapping personal investments and savings. Working with an experienced real estate broker familiar with the unique Alaska lending landscape is advisable.

What legal considerations or restrictions apply to buying land in Alaska?

It's important to research zoning regulations, usage rights, easements, right of ways, permit requirements, and property tax implications when buying Alaska land. Much of the state's land consists of national/state parks, wildlife refuges and preserves with restrictions on commercial activities, development, hunting, mining, etc. Understanding any ANCSA Native Corporation enrollment or borough jurisdictional authority over the land is also key.

What costs am I likely to incur improving or developing raw land in Alaska?

Buyers must account for exponentially higher costs to clear land, install septic and utilities, transport building materials, and construct access roads in Alaska's remote locations. Logistical planning using barge services in summer, ice roads in winter, or aircraft year-round is necessary. Deep pile or post foundations are often required to prevent permafrost thawing related issues. Self-sufficient power, water supply, fuel storage and satellite internet/phones add more.

What climate or environmental factors should I evaluate before buying land in Alaska?

It's critical to assess average snowfall, rainfall, seasonal temperatures, freeze/thaw cycle dates, permafrost depth, wildfire risks, flood zones, soil stability, and erosion patterns across the property before buying. This data will inform necessary preparatory measures from site clearing to infrastructure engineering required to develop the land.

How can I determine reasonable use cases or valuation for undeveloped land in Alaska?

Consulting both state and borough land records to analyze comparable vacant land valuations in the area can establish fair market price. Reasonable use cases depend on terrain, access, natural resources present, wildlife patterns and soil composition among other factors. Zoning laws also dictate suitable recreational, residential, agricultural or commercial development opportunities that impact land valuations.

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