How to Appraise Vacant Unbuildable Land
By Joseph Nicholson, eHow Contributor
All real estate appraisal is local. There’s no single formula that can be used to appraise vacant unbuildable land simply because there are so many potential factors that depend on the local market and the land itself. There are, however, a few different approaches and some guidelines for those looking to put a cash value on vacant property.
Appraise the right property. It might sound obvious, but it’s essential to know the exact boundaries of a piece of land when trying to appraise its value. Vacant, unbuildable land often does not present clear boundaries like improved land probably would. If the land hasn’t been surveyed recently, there might not be any clear boundary markings, so getting a new survey might be helpful. It’s also important to check to see if the area is subject to any codes or easements that also affect the boundaries of the property.
Use comparable sales. The easiest approach to identifying the value of a property is to find recent sales of similar unbuildable property. Even if the recent sales don’t match exactly, adjustments can be made for the differences. If they vary in size, as long as they’re not dramatically different, a price per acre or square foot can be gleaned and applied.
Subtract improvements from recent sales. If the unbuildable property is in a fairly developed area and there are no sales of similar undeveloped properties, another method is to find a similarly sized and situated property and subtract the value of any improvements. These can include buildings, septic tanks, electricity and anything else affecting the value. In theory, at least, subtracting the value of all the improvements yields the value of the undeveloped land.
Value natural resources. Besides improvements, another factor in the value of property is any natural resources it might contain. For example, the value of a forested parcel of land might have a higher value if it contains marketable timber. If there are no similar property sales to compare against, have a timber professional assess the value of the timber on the property and add this to the base price of the land.