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If you’re a landowner, it’s integral to know as much as you can about land and the local property laws that govern the industry because these laws can change from state to state and have a major impact on the final price of the product. Potential buyers who are looking to buy from you will always consider all of the external factors surrounding your home before they make an offer, which is why you should do your research in advance.
1- Zoning regulations:
One of the most important considerations about property prices and how land laws impact it comes under the umbrella of zoning regulations, which dictate what you can and can’t do with your property. Whether you own an empty plot of land or a building, zoning regulations will always have an impact on land value because zoning laws allow the local government to earmark areas of land only to be used for one kind of purpose.
For instance, you won’t be able to build offices in a residential area, as that area will be reserved mostly for houses, and your land’s value may decrease as a result. Since you’re more limited in what you can do with certain land based on the zone you’re in, these regulations could have a major positive or negative effect on value, and you may only be able to gauge its impact by working with commercial appraisers.
2- Land use laws:
Land use laws are laws that govern how you’re able to use the land that you have, and these laws mostly exist for environmental concerns as many owners make a habit of cutting down entire trees or forests, which can no longer be done as a result of this law. However, this means that if your property is in a sensitive location, such as one that’s near a forest, an endangered set of trees, or even a historical site, you won’t be able to expand or physically change the land that much, which limits what you can do with it and could, as a result, lower the property value.
3- Building codes:
Building codes are in place to ensure every building that gets made, especially for commercial reasons, is always of a high enough quality to be used without posing a security or safety risk. If your property is in a commercial zone, you may be interested in building something and using it for commercial reasons, but if you run into strict building codes that regulate how you have to go about construction, construction will be slower, more difficult, and costlier, so any potential developer that is thinking of buying land from you will make this consideration and may lower their offer as a result.
4- Housing density:
It’s a well-known fact that the higher the housing and population density of an area is, the higher the property value of every plot will be, and this is something you can take advantage of if you’re aware of land laws. Local policies dictate how fast a population can develop by first creating a residential zone and then managing the construction of houses and how much they sell for since, if these laws are more relaxed, housing prices could indirectly go down, leading to more people settling there, leaving you with a higher population and housing density.
5- Property tax:
Property tax is one of the oldest enemies that landowners have, and it’s as much of a problem today as it has ever been since taxes are being raised across the board for all kinds of land. If your land is being heavily taxed, the value of your property will go down since no buyer will want to deal with that headache, but if you’re getting tax breaks or more incentives, your property value could improve drastically.
Conclusion
Understanding land use rules is key in the real estate world. These rules are like a blueprint for cities, deciding where homes, businesses, and parks can be. These rules, like zoning laws and environmental protections, shape how properties are used and affect their prices. As rules change, it’s important to stay flexible and make smart decisions to succeed in real estate.