Rolling hills, deep ravines, stunning blue lakes and starry skies — how do you put a price on your land? Whether you’re considering selling your acreage or just want to know how much it’s worth, the easiest strategy is usually to hire a real estate appraiser.
An appraiser will visit your property and look for specific qualities such as size, ease of access and any natural resources that increase its value. Here’s what they usually look for, plus a few ways to make your land more appealing to buyers.
Features That Add Value
An appraiser typically looks for these features when they evaluate your land:
Easy Access
From time to time, you might see a rural tract of land for sale that seems too good to be true — it’s large, fenced in and even has a well. The catch? You must traverse a muddy, washboard road stretching for miles to reach it. If it’s raining and you don’t have a four-wheel drive vehicle, forget about it.
Properties with easy access to the highway are more valuable than acreage farther away or even landlocked. If your land has a good road, that adds value as well. The best routes are relatively short, wide, paved and on a level grade. Other factors to consider are whether the main roadway to your property is public or private, if you have to maintain it yourself and if people can legally access it.
Utilities and Infrastructure
Buyers looking for a home in the city don’t have to ask whether the property has electricity — it’s practically a given. However, rural properties run the gamut from highly polished to completely untouched, and buyers might look for different levels of development.
Your property will be worth more if it includes a house or cabin, even if the buildings aren’t fully roughed in. Other factors that increase its value include:
- Electricity: Are electric lines already running through the property? Do you have alternative energy sources like solar panels or wind turbines set up?
- Internet and cell service: People looking for a truly off-grid experience might not mind the lack of cellphone coverage or Wi-Fi, but most will appreciate getting a signal.
- A water catchment system: This setup is a huge plus for properties in the desert or that lack plumbing.
- A septic system: Buildings connected to a septic system typically have lower taxes because municipalities only bill people connected to the public sewer. However, a septic system that breaks can be costly to repair.
- A well: Having a private water source helps people lower their water bills, and a well can increase your property value. However, they require regular maintenance, water testing and electricity to keep them running smoothly.
- Heating: Rural homeowners typically utilize oil, propane, electricity or wood combustion stoves to heat their buildings. Natural gas usually isn’t an option in the country. Buyers will probably be more interested in properties that already have heating systems.
Good Proximity and Privacy
People looking for rural land usually place a high emphasis on privacy. If your property is far away from the noise and light pollution of the city, it will likely fetch a higher market price than a homestead surrounded by development.
However, you get bonus points if your acreage is still close enough to town that you can get there quickly. Even people living in the country need to buy groceries and visit the doctor from time to time.
Mineral Rights
The rights to retrieve and use the coal, oil, natural gas, copper or other natural resources under the ground are called mineral rights. They often significantly increase a property’s value. In fact, mineral rights are sometimes worth more than the land itself.
If you own the mineral rights on your land, you can sell them while still maintaining ownership of your property. You can also sell them to your homestead’s buyer.
Appropriate Zoning Laws
A property’s zoning can limit how you use it. Zoning laws dictate whether the land can be subdivided and developed and how many houses you can build per acre. You may be allowed to construct one home per five acres in one county, while in another, you could only build one for every hundred acres.
Zoning laws themselves don’t directly affect a property’s value, but in the context of how a person wants to use the land, they can increase or decrease its worth. The laws govern whether you can use the area for residential, agricultural or commercial purposes. A real estate appraiser might evaluate how hard it would be to change the land use and zoning restrictions if someone wanted to build a home or start a farm on the property. In most cases, the fewer zoning restrictions, the more appealing the land is to buyers.
High-Quality Soil
The type of soil on your land determines what can grow there. A land appraiser will often take a sample to look at the levels of potassium, phosphorus, calcium, nitrogen and other nutrients in the ground. In general, rich, loamy earth is more agriculturally valuable than sand or extremely rocky soil.
However, keep in mind that some crops grow best in poor soil. If the soil type on your land supports crops that are in high demand where you live, that’s good news.
Ranching Resources
Raising sheep, goats or cattle may be a booming industry in your area, and homebuyers might look for land that can support livestock. Natural bodies of water or stock tanks are valuable assets. So is high-quality pasture with plenty of grass, forbs or browse, depending on which species people want to raise.
Structures like barns, corrals, calf chutes, cattle guards and holding pens add worth to your land. Fences also dramatically increase rural property value. The cost of fencing for even a single acre can be tens of thousands of dollars, so if your property is completely fenced in, expect your land to be worth much more than a wide-open range.
Game Animals
Does your property support a healthy population of white-tailed deer, mule deer, elk or turkeys? Does it have a steady food source, such as oak or pecan trees? Game animals typically increase rural property values because many people want to hunt on their land. If your property has abundant wildlife, be sure to mention it to potential buyers. You get bonus points if you have a hunting lodge or cabin.
Even being near public hunting lands can increase your property’s value. One study found that near Butner-Falls Game Land in North Carolina, houses increased by an average of $1,053 for every kilometer as they got closer to game land. This effect doesn’t occur everywhere, but it’s worth looking into if you’re trying to understand your property’s worth.
Timber
Densely forested property might increase its worth. The land appraiser will look at factors such as how many trees are on your land. They’ll also evaluate whether the trees have any use as timber, aesthetic appeal or wildlife habitat, or whether they actually detract from the property’s value. For example, a tree leaning over the road will probably incur maintenance costs in the future.
The appraiser can also determine when the timber will be ready for harvest. Does that stand of pine trees need another 10 years before it reaches maturity, or could somebody cut them down today and make a profit? A property with mature trees will be worth more than one with only saplings.
Good Historic Management Practices
How your property has been cared for over the years influences its worth. Regarding wildlife and timber, management practices can help or harm your land.
Have generations of hunters culled excess deer from the land with a special focus on removing unhealthy animals? Do high fences keep the deer trapped on the property, leading to decades of inbreeding and increased parasite loads?
Have foresters been selectively cutting down and replanting pines strategically, or do large stands of invasive trees grow unchecked?
Land stewardship practices strongly influence property values regarding hunting and forestry. A lot of this boils down to where you live and how the new property owners want to use the land. Good land management might not matter for someone who simply wants to build a house and retire in the woods.
Land Quality and Quantity
The more acreage you own, the higher overall value of your property. However, not all land is created equal.
A property’s price per acre tends to decrease as its size increases. Essentially, people get a discount for buying in bulk. Therefore, if you only have a small plot of land, you can typically sell it at a higher price per acre.
Your property’s configuration also plays a key role in how much it’s worth. Flat fields are typically more valuable than hilly, sloped terrain with cliffs or inaccessible areas because land is worth a lot more if you can use it. On a similar note, wide-open spaces are more valuable than long, narrow strips of land too awkwardly shaped to drive through on a tractor.
Good drainage is also a positive feature. Land appraisers can evaluate whether your land is prone to flooding. If it is, they’ll try to determine where flooding happens and how often, whether the water has strong velocity and waves, and how it impacts the property. A field that floods repeatedly is likely worth less than one with good drainage.
Other Positive Features
If your land provides recreational opportunities — for example, horseback riding trails, established campgrounds or an archery range — it’s probably more valuable. Other features that increase land prices include bridges over streams and creeks, rare wildlife habitats, historical value and archeological sites.
Aesthetic appeal also improves property value as long as it doesn’t detract from the usability of the land. A wide river that bisects the property might lower its worth, but scenic, rolling hills dotted with wildflowers could improve its value. It’s wise to clean your property of any debris, such as broken-down vehicles or unused farm equipment, before having an appraiser or potential buyer look at it.
Reasons to Have Your Land Appraised
It’s common to have someone appraise your property if you want to sell it. However, there are other good reasons to know the worth of your land, including:
- To guide your decisions: Your property is an asset. If you know how much it’s worth, you can make better decisions on what to do with it.
- To help you buy more property: Do you need to take out a loan? Knowing how much your property is worth will help you with that process because the bank views it as an asset. Plus, knowing the value of your land enables you to decide if another nearby property is fairly priced. That can help you negotiate when buying another tract.
- If you’re getting a divorce: If you and your spouse part ways, you’ll have to divide your real estate holdings, which requires an appraiser to evaluate your property. Then, you can decide whether to sell your assets and how to divide the proceeds.
- For insurance purposes: You’ll need a current appraisal if you want to get property insurance. It helps the insurer decide how risky it is to cover your land.
- For estate planning: If a loved one passes, you’ll need a current land assessment to help you decide how much their estate is worth and divide it.
- To lower your property taxes: Are you paying too much in taxes for your property? An updated appraisal might reveal that it’s not worth as much as it used to be, which could lower your taxes.
Knowing Your Property’s Worth
So many factors that affect rural property pricing that it’s impossible to list them all. However, you can get a good idea of which features positively influence how much your land is worth.
Your property’s size, available utilities, mineral rights, natural resources, proximity to other people and agricultural prospects play a crucial part in determining its value. However, only you can decide how much your land is worth. You just can’t put a price on things, like the memories you made in the garden or your child’s favorite tire-swinging tree. That’s what makes each homestead truly unique.
[Note: This was a guest post.]
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