How to Estimate The Value Of Your Land And Determine The Best Price At Which To Sell

Zoning is the process that town planners use to separate districts, or zones, that determine how developers can use land. The idea behind zoning is that city planners need to play an oversight role in organizing our urban spaces. Zoning regulates the kinds of activities permitted on a particular piece of land. Zoning is used to stabilize property values and ensure that new development does not harm residents or activities in the established surroundings. For example, you cannot build a noisy factory in an area zoned for single-family homes.

When trying to find out what your land is worth, it is essential to determine how your lot is zoned, as it will directly impact how a potential buyer can use it. There are many ways to identify the zoning of a particular piece of land. In most cases, this information is easy to access online by searching city or county ordinances to find the allowed uses for your property.

In the traditional real estate market, one of the most common methods used to establish fair market value is to look at what similar houses in the area have sold for in the last year or two. This method is often referred to as comps-based valuation. You can use a similar approach when it comes to land lots. However, the trick is to ensure that the properties you select are a fair comparison to the lot you are interested in.

When it comes to land, two adjacent lots may not have a comparable market value. One lot may have direct road access, and the other may be landlocked. One piece of land may have buildable topography, while the lot next door may be on a steep slope, making building more difficult. Land also tends to change hands a lot slower than houses, and therefore you may struggle to find comparable lots in the area that have changed hands in the past decade. The more recent your comps are, the more accurate, and therefore this information may not help with current market value. Therefore, you mustn’t rely on comps-based valuation alone when determining the fair market value of a land lot.

One of the most important differences between traditional real estate assets and vacant land is that the value of your land lies in potential rather than what is physically there. Two different pieces of land can have vastly different values depending on their possible usage. A parcel zoned for commercial development that could be used for a high-rise building could be worth hundreds of thousands of dollars, and property zoned for a park may be worth only a few hundred dollars. When you sell a land lot, you want to target buyers that will put the land to its highest and most profitable use.

Fortunately, there is a lot that you can do to increase the desirability of your land lot if you have the right information. If your land lot is on the outskirts of an urban area that is rapidly growing, you will be able to buy low and then sell on to a developer that will be able to build houses or retail developments when the time is right. While zoning is highly regulated, it is also possible to apply to have an undeveloped lot rezoned to be put to more profitable use. If you are interested in exploring these options, you will need to work closely with a land-use attorney.

The value of a commodity will always be determined by the principle of supply and demand. When demand for an asset is high, and supply is scarce, the value will increase. On the other hand, if there is a lot of a particular asset available, but it is not in high demand, prices will go down.

Land lots are, obviously, subject to the same principles. If there is a lot of land in a particular county up for sale, you may not get market value for the land as a buyer can reject your offer and buy another, a comparable lot at a lower price. However, land tends to change hands at a lot slower rate than houses. A family may hold the title for a piece of vacant land for generations before considering selling it. Suppose the area has been stagnant for a long time. However, if a new industry springs up in a city or town in the area, bringing growth and development, land that was not is demand suddenly has potential value to developers and builders. In this instance, you may see a lot of land on the market in the area, but it will still be gaining in value and may offer a good investment opportunity. It is essential to know the supply and demand for land in the area around your prospective land lot for you to get an accurate idea of its fair market value.