{"id":2905,"date":"2018-01-23T21:06:14","date_gmt":"2018-01-23T21:06:14","guid":{"rendered":"https:\/\/nationalland.com\/blog\/?p=2905"},"modified":"2022-12-01T21:43:21","modified_gmt":"2022-12-02T02:43:21","slug":"understanding-land-appraisal","status":"publish","type":"post","link":"https:\/\/nationalland.com\/blog\/understanding-land-appraisal\/","title":{"rendered":"Understanding Land Appraisals"},"content":{"rendered":"

Land Appraisals are one of the most important parts of a real estate transaction. One could argue that land appraisals are one of the most important parts of owning real estate. Why then, are they so difficult to understand? This is a quick review of the process and the parties involved.<\/p>\n

There’s a LOT of Land<\/h2>\n

If someone asked you, \u201cHow many acres of land are there in the United States,\u201d would you be able to answer it correctly? Would you guess a million? 50 million? Half a billion?<\/p>\n

If you answered in your head and guessed any of those, unfortunately, you\u2019re not even close! The United States contains around 2.3 BILLION acres. Alaska, Texas and California are the three largest States in the U.S., accounting for 666,480 acres combined. Excluding Russia and Canada, countries in the world are around the size of Oregon. As a result, our 2.3 billion acres includes a huge diversity of populations and landscapes. This makes it impossible to develop uniform standards for land appraisal.<\/p>\n

No Two Pieces of Land are the Same<\/h2>\n

Landscape can change completely within a few miles. Nothing illustrates this more than Denver, Colorado. From this location, you can look North and see an enormous wall of mountains on your left and flat, rolling hills on your right. In fact, you don’t have to travel miles, landscape can completely change from parcel to parcel. This article can almost end here, all land is not the same and that creates a complicated world for land appraisal. Ending here, however, would be a disservice to you, the reader.<\/p>\n

What is a Land Appraisal?<\/h2>\n

A land appraisal is also known as a property or land valuation. Narrowed down, a land appraisal is the value of land based on the opinion of a licensed appraiser. An appraiser is an individual who has been licensed in a given State to offer opinion on the value of real estate. The licensing process for an appraiser varies from state to state and it can easily be a two year process for an individual to obtain enough experience to earn a license. The Appraisal Foundation<\/a> is one organization that is nationally recognized and has introduced uniform standards of ethics, but licensing remains State to State.<\/p>\n

Land appraisals are given in the form of a report and are based on the value of a particular piece of land if it were to be sold in the open market. Keep in mind when considering a land appraisal, it is not the same as an appraisal on a building. The appraisal process can be broken down into three methods, the most common is the Sales Comparison Approach.<\/p>\n

Land Valuation Methods<\/h3>\n