Land appraisal is a crucial step in a variety of real estate investment transactions. Whether you’re looking to buy raw land, develop it into a commercial property, or sell the land as a recreational property, a professional land appraiser can help you determine the value of your land and identify its highest potential use.
Depending on the property and the location, a land appraisal can range in price from a few hundred dollars to over four thousand dollars. This is because it can take a lot of time to do an assessment of the land, especially if there are environmental or specialized studies that need to be completed.
Zoning, Development, and Access
When it comes to determining the value of land, zoning laws are an important consideration. They can limit the property’s ability to be developed or even how the land can be used, which is why it’s important to visit your local zoning office and check to see what type of use is allowed on your parcel.
The zoning of your land will also affect the value you receive when you purchase it. Many rural areas have a strict zoning system that dictates what types of structures can be built on the land. This means that if your piece of land is zoned as commercial or residential, it will likely appraise at a higher price than land that’s zoned for agriculture.
Another factor that can affect the value of your land is whether or not it has any access to utilities. This could be a huge issue for a property that’s landlocked. This can make it hard to bring in electricity or water, which can significantly impact the value of a property.
This is why it’s important to check with your lender before purchasing a property that’s landlocked or has no access to utilities. This can make a big difference in the amount of money you get for your property and the interest rate that you will pay.
Topography, Access, and Development
A good parcel of land that has the potential to be developed can increase its value dramatically. Whether it’s for residential, agricultural, commercial, or industrial purposes, the right parcel of land can be a huge asset to your portfolio. It can provide a safe haven for your family or be the perfect spot to build a new community.
One of the most common ways to value vacant land is by using sales comps, or comparable properties that have recently sold in your area. This will allow the appraiser to evaluate the property at its highest and best use, based on what other properties in your area have done for similar purposes.
Once they’ve figured out the best possible use for your land, the next step is to calculate the residual value of your property. This value is what your land would be worth if it wasn’t already being developed. This can be a tricky thing to do because it’s more about what the future may hold for your land than anything else, but it’s an essential component of the appraisal process.