Beth:
Hi, I’m Beth with TB Properties Buys Land. In the previous video we discussed the difference between your assessed value and your market value. What we discussed is that every county and every state is different; assessed value from your tax collector could have nothing to do with the market value of your property at all. Assessed value is typically what the tax revenue is based upon. One county could be driving up the assessed value in order to reap more in taxes, and another could be keeping it artificially low to keep property taxes more affordable in that particular county or state. With that said, if your assessed value is similar to your market value, and the county seems to do what it can to keep them in line, the next step is to look at in your particular property. You can never truly understand the value of your property based upon county averages but instead need to get into the nitty-gritty of it.
Some of the biggest things that are going to contribute to value for you is, number one, access. Do you have access to your property? Is there a road going to your property? Is it a county road that is going to your property? That means the county will be maintaining it. If it’s snowing, if it’s raining, if it gets torn up, whatever it is, this means a public entity is going to maintain your road so that you can continually get to your property anytime of year. To us, that is the most important thing, to have access to your property. Going a little further, maybe you have a road, but what if it is a private road? If you don’t have a public road that’s being maintained by a county and that everyone has a right to travel, is the private road, a legal road for you to access? In other words, do you have a legal easement across that road to your property? In some cases you may not!
As you can see, this is the difference between having physical access and having legal access to your property. To us, not having physical and legal access or just having one and not the other could tremendously devalue your property. Another question is, do you have a survey of your property? A survey for a smaller 10-15 acre property could cost you $2,000+ if it had been previously surveyed fairly recently. If you have a very old property, and it was not subdivided very well, if the records were not kept or they got destroyed at the county level, you could be looking at six, seven, eight, nine, $10k+ for a survey. We had a very small piece of property, 15 acres that we were trying to purchase. We were quoted close to $10,000 for the survey, and we were warned that because of how the property had been passed down through the years, that they could run all of the Title research and still never actually be able to even survey the property because the records were so badly kept. As you can see, there is a value to having a recent survey already on file. On the flip side, not having a survey on top of past records of the subdivision not being kept up or accurately performed could also diminish the value of your property or make it nearly impossible to survey or even sell.
Another factor that affects value is what shape your property is in currently. How long has it been since you’ve been to your property? What’s happened to your property since you’ve been there? Has it become an illegal dumping ground for neighbors or others? Google Earth is a great resource for us to check on it over time and see if your neighbors have been dropping off old cars and all kinds of things on your property, old couches, that sort of thing.
It could cost a lot to clean your property up if people have been illegally using it to dump trash on. That’s an important question to ask, and that will devalue your property. It may not seem like that big of a deal, but keep in mind that if you go out there and haul off an old car or truck and take it to the dump, that may be one thing, but if you’ve got an investor trying to go in there and clean up that property, they can’t easily (and legally) hire someone to tow that old car or that old truck without having the title to the vehicle in hand to present to the towing company. The towing company may require the Title to the vehicle before hauling it off to a dump. I mention this because we have run into this before! The bottom line is that it could be more expensive and a bigger deal to clean your property up than you might think.
Another thing that could affect the value of your property are the trees. Did you sell off all the trees and have the entire property clear cut? Do you know what the property looks like after that’s done? Often times the timber company leaves a bunch of stumps and it can look really trashy out there for a long time, for many years even, especially if you did not have it replanted. A clear cut can be an automatic “cut the value of the property in half” drop if it’s only been a few years after the clear cut and it still looks ugly.
The factors mentioned earlier are just a few that can decrease the value of your property. When it comes to assessed value versus market value, you often cannot compare the two as we discussed in the first video. You don’t know where the assessed value is coming from, but you do want to determine market value. Today’s video discusses several factors that can bring down the value of your property.
These are some of the things that we’re going to ask about when we get you on the phone or what we may ask when sending you an email. We want to know about these things because they can affect the value of your property. Think about if you’re trying to buy a property and it’s ugly and all the trees have been cut down and there are stumps everywhere. What about if you can’t get out there because there is no road? Or what if you can’t get out there half of the year due to weather? Does that have the same value to you? Probably not. I hope this has answered a few questions about value when it comes to your bare land. Please feel free to reach out to us with any detailed questions. We’re happy to help you. We purchase vacant land property in cash, and we always close through a title company for safety. We don’t pay much attention to assessed values determined by the county tax assessor’s office but instead try to take a look at your property individually and make you a fair offer on it based upon these factors. Thanks again for listening. We look forward to hearing from you.