Land Use Regulations
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Disclosure of Defects                View all LAND BUYING articles

I just got wonderful news from my real estate agent in Florida. They found land on my property.”  — Milton Berle, circa 1950      

It is not illegal to sell an unbuildable lot – or a lot not suited to your use. For example, the lot may be approved for a two-bedroom home and you may want to build four bedrooms. First and foremost, you need to determine if the lot you are considering can be used as you envision. The laws about what can and cannot be built on a piece of land vary enormously from area to area. However, in general, you can expect more restrictions, more complex permitting, and higher development costs than a generation ago. In evaluating a piece of land for purchase, take your time and proceed with your eyes open.

Land use is governed by a wide-ranging set of regulations at the local, state, and sometimes federal level. Uses may also be restricted contractually through protective covenants and other deed restrictions. Before wasting too much time evaluating a piece of land, first make sure that you can use build on it and use the land as planned  read more

Once you’ve found a parcel that seems attractive, you’ll want to do some preliminary, free  research to if it’s worth pursuing further. Start by asking the seller or seller’s agent all the questions on you list, and if things check out, move on to town officials who can provide a wealth of information – all for free. In general, you won’t want to spend any money on investigations until after your offer is accepted read more

In the old days, the principle of caveat emptor (let the buyer beware) applied to most real estate transactions. It was the buyer’s responsibility to thoroughly inspect a building or piece of land before purchasing. The trend over the past few decades has been to require sellers to disclose significant defects  read more











  1. Valuation of Unbuildable Lot

    Hi, I own a non-buildable 50×100 ft. lot, roughly assessed at 8k. Someone just bought the house adjacent to the lot for $450K with no garage and minimal driveway space. The new owner wants to purchase my lot so he doesn’t have to shuffle cars in the wintertime when you cannot park in the street here. I don’t think

    He’s made an offer of $5,500 dollars, but I don’t should sell for less than assessed value. How do I determine the convenience value of expanding his lot size, solving parking issues, and enabling him to add a 2-car garage down the road, which would improve his home’s market value. Which value should I use that makes sense for both of and is fair value? Thanks in advance!

    • buildingadvisor says:

      As you can imagine, putting a precise price on an unbuildable lot is a difficult thing. I wouldn’t pay too much attention to a tax appraisal as these often have little to do the actual sales price of real estate.

      Any property appraisal is only an educated guess at what property will sell for on the open market. Since an unbuildable lot is a somewhat rare bird with a very limited market, it is difficult if not impossible to find meaningful comps. So the appraiser must apply various fudge factors for such things as “lack of marketability”.

      Nonetheless, getting a professional appraisal might be worth a few hundred dollars. I have found appraisals useful in trying to justify a sales price when you are selling real estate “by owner.” If a buyer asks, “how did you come up with that price,” you have a good answer. You can also advertise that your asking price is X thousand dollars below the appraised value.

      Also, in talking to a seasoned appraiser, you will learn about how unbuildable lots are valued – including, I would guess, how much it might raise the value of your neighbor’s property. One concept they use is the “highest and best use” of the property. This might give you some ideas for other potential buyers you may not have considered.

      Whether your neighbor is swayed by this information remains to be seen.

      Bottom line: any property is only worth what someone is willing to pay you for it. The most likely buyer of an unbuildable lot is an abutter, like your neighbor, who wants to enlarge their property, increase their privacy, or prevent someone else from buying it and using it to store old trucks, etc. Even though the lot cannot be used for a dwelling unit, in most cases it can be used for other structures depending on zoning – garage, barn, agriculture, etc.

      The other type of person who might buy an unbuildable lot is someone who thinks, rightly or wrongly, that he can figure out a way to build on it by getting a variance or some other loophole. Occasionally they are successful, but more often they are not.

      Your question about how much the added land would increase the value of your neighbor’s property is a good one and relevant. That is a calculation he is probably trying to make as well, and one that an appraiser can help you with. How much he personally values the added space and convenience, however, is subjective and impossible for you to know – other than by what price he ultimately agrees to.

      People often invest money in real estate – say adding a swimming pool – that they know they will never recover, for the use and enjoyment they will get while they live there. A home is more than just an investment.

      Other than getting a professional appraisal, you are left with two people haggling over price as people have done for thousands of years. There are no hard-and-fast rules here, only negotiation. But the more information you have about the land’s potential value, the more effectively you can negotiate.

      In any case, it never hurts to counter with a higher price, and the buyer might come around. Be patient. Since it appears that there is only one seller and one buyer in this negotiation, there is no reason for either party to rush. If you can find any other potential buyers, that would certainly help your cause.

      FYI: I purchased an adjacent unbuildable lot a little bigger than yours (80×160) several years ago for about $20,000. The seller was asking $70,000 and I offered $15,000. Building lots of that size were going for about $200,000 at that time. The wooded lot protected my view and privacy. Its current assessed value by the town is $6,000. However, I believe that it has increased the sales value of my house by at least $20,000 as it will double the size of my lot and provide nice wooded views when and if I sell. I used this economic rationale to justify my the purchase price, but like many real estate purchases, the decision had a strong emotional component – desire for views and privacy and fear of what might end up in my backyard if I didn’t buy it. I followed my instinct and am glad I did.



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