Appraisals for landlocked timberland

[Turkish]

How do appraisals work for land that has no legal access? Can they even be provided?

I ask because I have a neighbor with land that has no legal access. They have never set foot on it in the last 7 years, to the best of my knowledge. My land has county road frontage, so, if I owned this neighbor’s land, it would, too. For that reason, as I see it, it’s worth more to me than another owner that doesn’t connect to the road.

Would an appraisal bear that out? Do they account for the lack of access? It seems, I could pay over appraised value and not “overpay.” Holding all things equal, let’s say land with access appraises for $2k/ac but without is $1500. If I could get it for $1700, it’d be worth $2k after I close.

Thoughts?

 

[Mennoniteman]

Real estate appraisals for larger parcels with no buildings are difficult to do, because there's a lot of variables, and are often a point of contention and criticism, and are often not the deciding factor used to set the sale price.
There's ultimately only two things that really matter in the sale of a piece of property, the price that the owner is willing to sell it for, and the price that a buyer is willing to pay for it. When those two sides can come together and agree to the same figure the sale is made.
To answer your question, landlocked land is worth less on average than land with a right of way, and an honest appraisal will reflect that. But if the seller knows that the interested buyer can procure or has a right of way, that seller will probably try to capitalize on that information. For that reason, in your situation if you want to buy the parcel you may want to approach the owner incognito to prevent that from happening.
But if the seller hasn't advertised it for sale that's always a point against prospective buyers that would like to buy the land cheap. I have numerous parcels of land that I haven't set foot on in quite a few years, and it always irritates me when someone contacts me wanting to buy it for a very low price because they decided that I don't want it anymore. If I quote them a price it's going to be high because they have offended me. If they come straight out with a good offer I'll respect them for it, and I'm much sooner apt to consider it.

 

[Mennoniteman]

Another point to consider, a lot of banks don't like lending money to buy land with no buildings on it, and most banks won't lend money to buy landlocked land.

 

[Turkish]

The land that I own was bought with no appraisal, so I get what you’re saying. It may be marketing, but I’m wondering if I’d be lying if I told him “I’d be willing to pay over appraisal.” In the past (maybe 2 instances of correspondence), he’s expressed no interest in selling.

Land banks in this area readily lend for vacant land, or at least used to. I probably should talk to them.

But you bring up one of the things on my mind. If they won’t lend on landlocked tracts, would they lend to me, since, to me, it isn’t landlocked?

 

[Mennoniteman]

The bank might force you to provide a right of way over your current piece of property to the proposed one, before they give you the money. Because they are going to be thinking; if we do a mortgage and he doesn't make the payments then we (the bank) end up owning a piece of landlocked property.

 

[Buckly]

How do appraisals work for land that has no legal access? Can they even be provided?

I ask because I have a neighbor with land that has no legal access. They have never set foot on it in the last 7 years, to the best of my knowledge. My land has county road frontage, so, if I owned this neighbor’s land, it would, too. For that reason, as I see it, it’s worth more to me than another owner that doesn’t connect to the road.

Would an appraisal bear that out? Do they account for the lack of access? It seems, I could pay over appraised value and not “overpay.” Holding all things equal, let’s say land with access appraises for $2k/ac but without is $1500. If I could get it for $1700, it’d be worth $2k after I close.

Thoughts?

many a person has tried to use the fact that the land next to them should be worth less because it’s landlocked. Good luck. I don’t think your going to get anybody to get a good appraisal on it. As was said it’s almost impossible to figure out. If you’re interested in buying it make your offer. If it’s denied then you know it’s worth more. And you’re right on the point that adjoining property is always worth more to you. Just my opinion. I would approach this discretely with the owner if your serious about buying it. Otherwise they might get ideas and sell it to somebody else. Then another neighbor might grant an easement or worse yet they legally try to force an easement of necessity and if you lose in court you could have a road right on your property that goes to theirs. Just depends on what piece that originally came from. Headaches anyways.

 

[Mennoniteman]

The only way to negotiate with a landowner who has no interest in selling is to make them an offer that gets them interested. In other words, an offer they can't refuse.
To say "I am willing to pay more than appraisal" isn't going to get a reluctant seller's attention like an actual number on paper will. And if you decide to propose a number, you will want to consider that number long and hard, because you probably only get one good chance. If the number is too low and he refuses without a counter offer you're now in a predicament. If you make a higher offer you come across as desperate and the seller will really wait you out for a long time to see how many better offers you propose. So the first cash offer is a very critical one if it's being made to an uninterested seller, whereas an offer to a very motivated seller is not critical at all, you just stay on the low side and see how motivated he is.
An offer on paper to an unmotivated seller should not be anything fancy, just a straightforward note with the offer. Some ppl would probably disagree, but to me, an offer on a multiple page real estate agreement ready to sign, made to someone who has not advertised the property for sale, is going to come across as presumptuous and will probably not help your cause.

 

[Turkish]

While I appreciate the input, mostly I’m curious about how appraisals work on such tracts.

I can navigate the interpersonal aspects acceptably.

 

[Mennoniteman]

Twice I purchased landlocked woodland from an owner that wasn't interested in selling. Both times I did it exactly the same way. I went to their place and politely introduced myself, and stated that if they would ever consider selling that piece of property I would be interested in buying it. Both owners said exactly the same thing; no, I'm not interested in selling it. So I said; that's ok, I was just checking. Then, after some small talk, they each said; what price would you say that piece of land is worth? So, this is the critical moment in a negotiation, have your number ready for this moment. I say, well I'm a fair person and I'd be willing to pay a fair price. Then, without any hemming and hawing around, I name a figure that's about 5% more than what similar land is selling for. They stammer a little and mention that they are a little short on money right now, would I consider: then they name a price that's 10% above market value. So I say; that will really stretch me to my limits, but I probably could make it work just to help them out. And in ten minutes time the land is sold. So before anybody can change their mind, I get two sheets of note paper out of my truck and handwrite two identical, dated bills of sale with all the pertinent details, including settlement costs and transfer taxes, right there, right away, and we both sign each one and they get one, I get the other. That paper will hold in any court of law if a witness signs it.
So, I was obviously pretty hard up for these pieces of land, to be willing to pay a 10% premium. But that's about the only thing thing will get the deal done.

 

[Turkish]

Thanks. If I’ve erred on any side of this, it’s been on the conservative one. He does give me turkey hunting permission by text message. Not really a very talkative fellow otherwise.

The bank might force you to provide a right of way over your current piece of property to the proposed one...

Not an issue for me. It would be for any other buyer on the planet.

 

[OkieKubota]

We ran into this exact scenario with a landlocked 10 acre parcel that connects to the northwest corner of our property. I had met the owner once when we first purchased our place and he offered it to me for 1k acre. We had just closed and we’re building fence so with the 20% down we had paid and all the fencing material I was not in a position to purchase right then but I took his number. Land in the area is worth 2k acre with access.
I had a dream one night about the property a year ago and woke up and told my wife I didn’t have a good feeling about that landlocked piece so the next day I called the owner and inquired about the property. He told me he had 2 guys interested in it for 20k. I told him it had no access And he said he thought another neighbor would probably give them access. I just told him “well, if they don’t take it let me know.” A week later he called and offered it to me for 20k...I told him I would give him 10k cash and he bit...

 

[Buckly]

While I appreciate the input, mostly I’m curious about how appraisals work on such tracts.

I can navigate the interpersonal aspects acceptably.

it always amazes me why people own land that they never intend on using. Did they inherit it? Anyways, I think what people are saying is an appraisal isn’t going to be accurate even if somebody will do it. Around here, most of the tax assessors used to be real estate appraisers for banks or their own firms. They claim anyway that their tax assessment is correct and if you want to check , get it appraised. So they’re saying the tax assessment should be appraised value. Results may vary. Lol.

 

[buckdeer1]

I would print off 2 purchase agreements for your state and go talk to him,make sure you know the legal.You most likely can get a real rough estimate on how the county feels about the value that if it helps mention if not don't.When I buy land the bank sends the appraiser and doesn't even talk to selling landowner.In some states it's not legal to sell landlocked land so from what I was told you would be the only one he could sell to.This is what a lawyer told me in Kansas and I know 2 landowners that bought pieces because of this.Just go ask,but don't think you can't walk away and think about the counter offer start low and go as high as you want.

 

[Turkish]

In this case, yes, it was inherited. The feedback is helpful. If I want to make an offer, do so, but mentioning appraisal is probably meaningless.

In my bringing up appraised value, it was only in the context of what it’s worth to me vs. other potential buyers. Not what it’s worth to me vs. the current owner.

 

[dogghr]

I’m sure varies by state but here it is illegal to deny access to so called landlocked property. My farm county is full of ROW access across properties.


Sent from my iPhone using Tapatalk

 

[white cloud]

I would not get a formal appraisal unless the lender wants it. That's assuming you finance. I would scan "Land & Farm" for a bit and come up with a figure. Remember to start low in your negotiations but be aware that most landowners have an idea of what their property is worth. Ag South is handy to talk to when determining what land is worth in your area. If the property has merchantable timber on it, I might want to check that out also.

Timber land here in S.C. has sky rocketed in price lately.

 

[Bowhunter]

I wouldn’t even mess around with an appraisal. A better bet is to locate similar sized landlocked parcels that have been recently sold using your county records system. Most are available online and are free to use. I would have three parcels that are at the bottom end of the per acre cost and have the information printed out to show it to the landowners when negotiating a price.

FWIW it isn’t allowed to create a landlocked parcel as access is always implied. In other words, in all but the rarest occasions an ingress and egress easement is attainable.

 

[Turkish]

Yes, ingress/egress would be attainable. Often, the issue more at stake is the cost of that access, its condition, and proximity to utilities.

 

[buckdeer1]

You shouldn't feel required to pay more than someone that doesn't have access I is true it's probably worth more to you as there is only a couple pieces of land that connect to what someone owns so it doesn't happen alot.I just bought the second piece that connected to the last piece I bought last year.

 

[OkieKubota]

In Oklahoma we do not have to give anyone motorized access to landlocked property. They can walk to it from the closest public road access point across whoever’s property is there but if that landowner doesn’t allow hunting they can’t carry a firearm. Before I bought the landlocked 10 I mentioned before I had told the owner he could walk along our west fence to get to his 10...he never did that I know of...