Unbuildable land valuation: how much is unbuildable land worth?

What is unbuildable land?

This is an area of land that cannot be built on because it does not have planning permission to build from the appropriate authorities. You might have a fantastic piece of land that is zoned as residential or commercial, only to learn later that you can't build on it. You might even hear from a real estate professional that the site is undoubtedly suitable for construction. The building department can confirm that you can build in this area even if you don't have any blueprints. Then, when it comes time to submit the building plans, you get a big refusal stamp.

Land can be rendered unbuildable due to several reasons:

• Hazard zones - The area where the airborne concentration is equal to or more than a certain threshold of concern is known as the hazard zone. The region of impact for a combustible release is determined by a predetermined degree of heat radiation. A county may choose to designate your property as a hazard zone for any number of reasons. Some due to fire, landslides, or really whatever they choose. During what they refer to as "act of god calamities," they simply don't want to engage with anything outside the immediate vicinity.
• Annual Permit Limits - Authorities responsible for issuing building permits may limit the number of permits issued each year and there might be a very long waiting list. This is usual in big cities. Alternatively, they may just cease granting permits altogether when a limit is reached.
• Home Type - There is a construction department in each county that must be dealt with; some counties permit almost everything, while others don't. The majority of six months might be spent only on the building approval process. Then you will be subject to frequent inspections, expensive documentation, and perhaps even forced to demolish whatever they find objectionable.
• Lack of city resources - For things like fire truck access, certain locations do not have roads; this is a concern for the counties. I've seen some gorgeous acreage that people choose not to build on simply because they can't get to it quickly in the event of a fire or other emergency. Therefore, the permission is rejected; but, after the roads are built, this may change.

How much is unbuildable land worth?

When valuing unbuildable land, the allowed use that will generate the highest return on investment and the highest and best use of the property is chosen first. In addition, for unbuildable land to have value, it must have some economic purpose.

The following are factors to consider to estimate a land’s worth properly;

• Visit the property in person to confirm its features, accessibility, and utility accessibility. Make sure the property has a clear title and that there are no encroachments by investigating title information and property history. You can find title information in your local government's records division.
• Identify the property's highest and best usage. Even though the land cannot be built on it, other uses that increase its value might be permitted. The area could be used for agricultural purposes, the extraction of minerals or timber, or as a storage yard, for instance. Find out what uses are permitted by local zoning laws, then decide which use would be most profitable economically.
• If the underlying zoning permits mineral extraction or timber harvesting, evaluate the value of the natural resources that are already present on the property. If the extraction of natural resources is considered to be the highest and best use of the land, estimate its volume and economic value.
• Locate at least three comparable recently sold properties that share the same qualities and intended purpose as the property being assessed. To locate comparable properties, consult the tax assessor's database and local property records. In addition to being accessible in the tax assessor's office of your local government, records can occasionally be found online.
• Similarly, adjust the property value for other variations, such as:
  • view,
  • the worth of natural resources,
  • location,
  • and access, until a final value is reached. 

Comparative analyses of each sold property should be conducted, and the adjusted values discovered for the appraised piece in each exercise should then be averaged. The estimated worth of the unbuildable land is represented by this average number.

Calculation on how to fix the price of unbuildable land

For a buyer, it is crucial to conduct a study of unbuildable lands by analyzing their features and determining whether the acquisition of the land is lucrative. This will ensure that the selling price is reasonable. You only need to perform a straightforward calculation to accomplish this. The formula for this calculation is the Value of return minus the Investment cost. (Investment costs - Value of return). 

The seller must research the real estate market and analyze comparable unbuildable lands in order to determine the price. You can conduct this examination online through a real estate portal such as RealAdvisor for instance. The owner will then need to modify the cost of his property in light of its advantages and disadvantages to find the appropriate price.

What to do with unbuildable land?

Like all real estate, unbuildable land is valuable, and what you choose to do with the land you own can make it all the more profitable. Unbuildable land can be kept the way it is and later sold on the market. Also, it can be used as land for boat storage. Although people like leisure activities like boating, finding storage for those things can frequently be difficult, especially if they reside in cities or compact suburban areas. The land can also be used for farming purposes. 

Cultivating timber is a popular way to make money. Also, why not plant flowers if you enjoy the notion of growing things and want to generate money off of unbuildable land? You can cultivate flowers on your property and sell the best specimens at a nearby farmer's market. Unbuildable can also be used to build roads in the community. Usually, compensation benefits are offered to the owners of the land. Unbuildable land can also be used to harvest solar energy. Though the construction of these solar panels and fuel is expensive, its returns or profits are incredible.

You can also make use of unbuildable land by breeding animals to sell to generate money. Why not, if you have the time and room to do it? Just make sure you're abiding by the local laws and treating everyone fairly. For a more passive strategy, you can also lease the land to local farmers so they can graze their livestock.

What to do?

Finding the worth of your unbuildable, vacant land and knowing how best to make use of it is not always simple. At RealAdvisor, we offer land, building, and home evaluation and services to help you estimate the worth of your unbuildable land.

In summary, these are important points about the worth of unbuildable land:

1. Land can be rendered unbuildable due to several reasons by building authorities.
2. Although unbuildable can’t be built on, it sure has some worth.
3. For unbuildable land to have value, it must have some economic purpose that will general higher returns on investment.