Factors Affecting Land Appraisal Value
Appraising a undeveloped, vacant land is much different from appraising a house; the factors considered during the appraisal are much different. Here are some of the essential factors when it comes to empty land appraisal:
Zoning and Restrictions
Zoning and local restrictions determine the types of activities you can perform on the land, as well as the type of buildings you can construct. Some areas are meant for farming, others for commercial properties, and others for residential properties. The zoning specification under which your land falls has an effect on the price; for example, land in commercial zones typically fetch more than land in residential zones.
The current state of the land determines whether you can construct a property on it without much hassle, or if you need considerable improvement to make it construction-ready. For example, if the land is hilly and rocky, you may have to level it first before commencing construction. A swampy land that needs to be reclaimed first, for example, may not fetch as much as a dry land that is ready for construction.
Improvements in Place
If there are any improvements in place, you should expect their value to be included in the sales price. Maybe the current owner has a perfect fence in place, has dug a well on the land, or has already connected the utilities. In any of those cases, expect to pay more for the land than you would have paid without the improvements.
People don't always buy land to construct residential homes; some people buy land to farm, while others buy land to construct commercial structures such as shopping malls. In many cases, the land zoning may give an indication of why one would be interested in such a piece of land. In that case, the income potential of the lot may also be a factor in its pricing.
Ease of Utility Connections
If you are buying undeveloped land that doesn't have even the basic utilities connected, then the ease of connecting the utilities will also affect the price of the land. In that case, proximity to utility connection points, for things like sewer, gas, and electricity, will determine the price of the land. The nearer the connection points are, the easier they will be to connect, and the more expensive the land will be.
Therefore, if you are buying your first empty lot, you may need help to ensure it's priced correctly. A real estate agent can help you do this just as they would help you with a home purchase.