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Built-up % Of Available Land

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Certified Residential Appraiser
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Nevada
Finding myself in a new market, I've seen large parcels of undeveloped land. FNMA says built-up is "the percentage of the available land in the neighborhood that has been improved." What is considered "available" land? Would this be limited to parcels that are on the market? Research has shown that a lot is government-owned. Other owners include institutions, LLCs and individuals. Zoning varies as well. I wouldn't consider any of these lands "available" unless they were on the market. But, perhaps available also means available for owner-development?

There could be lots of reasons why the land is undeveloped so, I have a hard time providing a pat explanation for the vacant land. I'm noting that the marketing periods are typical of the greater market and therefore not indicative of a lack of demand. I may mention some of the types of owners. From reading through the selling guide, FNMA seems to be more concerned with rural areas which this is not. Maybe this is another one of those FNMA details for which everyone is left to their own interpretation?
 

J Grant

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Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Available does seem to be one of those tricky words...imo I would describe what land is improved and the uses, and then what is not built on and describe, such as there is large tracts f land vacant is govt owned, or owned by institutions. If there are large tracts of land not improved owned by govt or institutions, what might be built there in future and how does the fact they might be built on impact value? Or is it vacant due to other reasons...you need to ask RE agents and do some research into the area.
 

Dublin ohio

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Mar 20, 2008
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Licensed Appraiser
State
Ohio
FNMA says built-up is "the percentage of the available land in the neighborhood that has been improved." What is considered "available" land? Would this be limited to parcels that are on the market? Research has shown that a lot is government-owned. Other owners include institutions, LLCs and individuals. Zoning varies as well. I wouldn't consider any of these lands "available" unless they were on the market. But, perhaps available also means available for owner-development?

IMHO. I would say that all land is considered. The section in the 1004 you are referring to is titled "land use". If you started limiting the definition of "available" land. What would your starting point be. Would you limit your total amount of land considered in neighborhood to just land that has been developed or is available for development?. What about public park land that typically cannot be anything but a park. What about protected nature preserves, etc., etc. What would you consider agricultural use land. It is not "developed" or "improved" in the traditional sense. But is being used. That is why there is the line in land use for "other" on the 1004 and other forms.
 

Tom4value

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Dec 4, 2016
Professional Status
Certified Residential Appraiser
State
Massachusetts
I have found that you can find your answer by asking why the question is being asked in the first place. Users of the report want to know this to determine the likelihood of the neighborhood changing in density and/or use. Land for sale is definitely useful but is not the end all be all because there could be lots of land available for development but is just not on the market. Generally, I look at the land that is in use that is not likely to change and categorize that in the grid (i.e. residential, municipal owned, commercial/industrial in use). Whatever is left I put down as undeveloped. In the comments you can state if there was a recent zoning change (usually done for a reason) or a military base closing that would mean a significant section of town is due for a change in make up.
 
Joined
May 17, 2009
Professional Status
Certified Residential Appraiser
State
Nevada
Excluding all vacant, unused land in the percentage of built-up land probably makes the most sense.
 
Last edited:
Joined
May 17, 2009
Professional Status
Certified Residential Appraiser
State
Nevada
I have found that you can find your answer by asking why the question is being asked in the first place. Users of the report want to know this to determine the likelihood of the neighborhood changing in density and/or use. Land for sale is definitely useful but is not the end all be all because there could be lots of land available for development but is just not on the market. Generally, I look at the land that is in use that is not likely to change and categorize that in the grid (i.e. residential, municipal owned, commercial/industrial in use). Whatever is left I put down as undeveloped. In the comments you can state if there was a recent zoning change (usually done for a reason) or a military base closing that would mean a significant section of town is due for a change in make up.

That's mostly what I think. I will comment that a significant portion of the vacant land is government-owned but, I wouldn't want to volunteer anything about future land-development . FNMA may like to know but, I don't think there is anything in the guidelines that says we are expected to do that. A comprehensive answer would require a general appraiser.
 
Last edited:

Terrel L. Shields

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Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I would try to estimate the number of parcels in the given "neighborhood" (not the "market area" which may be much larger). If the "neighborhood" is say a small town of 1,000. And it has 600 parcels I can sample estimate the # of vacant lots or use census data. I can estimate the number of parcels commercial. I can go the census dot gov site and it will generally break down the % percentages and numbers for residential.
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Mr Rex

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Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
Aerial photos don't lie. Guest-imating the % of land use is sketchy but reasonably defensible if you actually reflect what the picture shows. In almost every review I do in rural areas, the land use is close to 100% residential when the aerial photo shows 10-50% residential and the rest agricultural/vacant land. Go figger? We also have a 50,000 acre reservoir locally with 800 miles of shoreline. The Corps of Engineers controls all of the land below the 320 elevation and the mean elevation of the water is +/-300. By charter roughly 33 percent of the land adjacent to the 320 land is available for residential development, +/-33 percent is recreational use( campgrounds etc) and +/-33 percent is conservation land(wetlands etc) but I see 100% SFR in reviews. Not to mention that being in a rural area, the land not near the 320 elevation is less than 20% built up in most cases. Go figger?
 

Vermonter

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Joined
Mar 21, 2007
Professional Status
Certified Residential Appraiser
State
Vermont
Aerial photos don't lie. Guest-imating the % of land use is sketchy but reasonably defensible if you actually reflect what the picture shows. In almost every review I do in rural areas, the land use is close to 100% residential when the aerial photo shows 10-50% residential and the rest agricultural/vacant land. Go figger? We also have a 50,000 acre reservoir locally with 800 miles of shoreline. The Corps of Engineers controls all of the land below the 320 elevation and the mean elevation of the water is +/-300. By charter roughly 33 percent of the land adjacent to the 320 land is available for residential development, +/-33 percent is recreational use( campgrounds etc) and +/-33 percent is conservation land(wetlands etc) but I see 100% SFR in reviews. Not to mention that being in a rural area, the land not near the 320 elevation is less than 20% built up in most cases. Go figger?

Aerials are helpful, but not always. I have one town with mostly 10, 20 & 40 acre minimum zoning requirements. Taking that into account, the residential land use is about 60%.....in an aerial photo it would appear to be less than 1 or 2%.

Mostly I use land use percentages from my subject towns municipal plan. Obviously they're not broken down like the 1004 and only updated every 10 years, but it gives you a pretty accurate starting point.
 

residentialguy

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Joined
Mar 24, 2009
Professional Status
Certified Residential Appraiser
State
Minnesota
The good thing about area built up is that there is no consensus as to what that means, as some have stated examples above. As long as your reasonable and not obviously way off (e.g. stating 25% built up in urban) you're not going to be on the chopping block for being misleading.
 
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