Land Locked Land

[BlueMoose]

I am looking for some advice on determining a formula to value land locked land. Any tips, expertise, suggestions would be appreciated as I want to cover all bases. No easements exist that are known, which doesn't mean there might be some perpetual ones out there on surrounding properties going way back, but the majority of the surrounding properties have been acquired through a land acquisition thru the state for a protected environmental area. I don't have a survey or a title search....I am wondering if the State may just do an eminent domain down the road, but the intended purpose now is for market value for an estate. I am trying to search for vacant land locked land sales but not having much luck... as I wanted to do comparisons with other vacant rural land to come up with an adjustment. Please chime in!

 

[Terrel L. Shields]

I am looking for some advice on determining a formula to value land locked land. .......I am wondering if the State may just do an eminent domain down the road, but the intended purpose now is for market value for an estate.

A - you might ask the trustee to initiate a 100-year title search for an easement. That is never cheap. A petroleum landman might do it cheaper than a title company.

B - There are no "formulas" to fill in the blank.

C- You might poll some of the older brokers around. A - ask them what discount they think would apply, and B - if they recall any such sales in the past 30 years -

D - then the last resort is to do a cost to cure. That varies but again, poll some attorneys about the cost to obtain (force) an easement over another's property. Most states can require that but it is a court action and can have an uncertain outcome. And you do have to consider the impact of building a usable road into the site. That could be expensive

 

[BlueMoose]

A - you might ask the trustee to initiate a 100-year title search for an easement. That is never cheap. A petroleum landman might do it cheaper than a title company.

B - There are no "formulas" to fill in the blank.

C- You might poll some of the older brokers around. A - ask them what discount they think would apply, and B - if they recall any such sales in the past 30 years -

D - then the last resort is to do a cost to cure. That varies but again, poll some attorneys about the cost to obtain (force) an easement over another's property. Most states can require that but it is a court action and can have an uncertain outcome. And you do have to consider the impact of building a usable road into the site. That could be expensive

A - you might ask the trustee to initiate a 100-year title search for an easement. That is never cheap. A petroleum landman might do it cheaper than a title company.

B - There are no "formulas" to fill in the blank.

C- You might poll some of the older brokers around. A - ask them what discount they think would apply, and B - if they recall any such sales in the past 30 years -

D - then the last resort is to do a cost to cure. That varies but again, poll some attorneys about the cost to obtain (force) an easement over another's property. Most states can require that but it is a court action and can have an uncertain outcome. And you do have to consider the impact of building a usable road into the site. That could be expensive

Thank you for the response, the land all around it... about 900 acres was purchased as various lots to be contiguous with a state forest and be preserved for hiking, fishing, hunting, and water supply. Previously it was forested. The lot is in the middle of it with trails around it and I doubt anyone is going to allow roads, but there were some atv trails previously on the forested land and I believe snowmobile trails are allowed and sleds can access. I am wondering if I could use Hypothetical and Extraordinary some way.

 

[Vermonter]

Thank you for the response, the land all around it... about 900 acres was purchased as various lots to be contiguous with a state forest and be preserved for hiking, fishing, hunting, and water supply. Previously it was forested. The lot is in the middle of it with trails around it and I doubt anyone is going to allow roads, but there were some atv trails previously on the forested land and I believe snowmobile trails are allowed and sleds can access. I am wondering if I could use Hypothetical and Extraordinary some way.

I found a parcel in 2021 that was technically landlocked by the state acquiring land for a Wildlife Management Area back in the 80s. State allowed a temporary easement for timber extraction in 2012 and it's been open ever since. I took a class that discussed this exact scenario and knew the state would have to provide access, so I made the owner an offer. Closed in 2022 well below market. State is paying for a survey, writing up a ROW and moving a gate to provide us cleaner access. I will probably have a lawyer look it over, but it's pretty straight forward.

Basically, the state of VT cannot landlock a parcel when acquiring land. It may be different in NY, but definitely worth a look

 

[Elliott]

Get a title search. Get a title search on adjacent lands that include easements. Its probably there. A county judge could probably come up with a reasonable access for an intended purpose and then ask for a value of that easement based on its limited use.

Talk to some eminent domain appraisers who have done ROW easements in your area.

 

[Terrel L. Shields]

I doubt anyone is going to allow roads

They won't have a choice in some states. It will be decided by the judge. Check with an attorney. PS - always keep an attorney for a buddy. I have 3 such friends and a paralegal that works with one is a real champ helping me when she isn't available. I don't think a HC is necessary. An EA is the likely outcome - or data to support an adjustment.

 

[Gobears81]

Sounds like this is rec land? I have seen a decent number of sales that don't have direct road access, but laws for that may be different around here. How are you conducting your sales search? Not sure how New York keeps their records, but it might be worth doing an old fashioned courthouse search for sales. Or, I hate to say ask another appraiser for sales, but if there is someone in the area that does a lot of work like this, I bet they could locate a sale or three pretty quickly

 

[JTip]

Talk to some eminent domain appraisers who have done ROW easements in your area.

More specifically, ask about sales of remnant properties. Little landlocked parcels created from acquiring parcels used for roads/interstates, with the option for the property owner to keep (who wants to keep that and pay taxes on it) or the state will buy it.
Every state has a book full of properties like that, and sometimes they sell when a neighboring property is interested. They must be advertised and a closed bid process is used to determine the winner.

You mentioned environmental purchase. Check with your local DOT's environmental unit as to the situation surrounding the purchase. I'd be curious how the 'estate' ended up with it. There is always a story behind it.

 

[Elliott]

I knew there was a term rattling around in my brain:

"A prescriptive easement allows someone other than the property owner to gain the right to use a property. Prescriptive easements often arise in rural areas when landowners don't realize part of their land is being used, perhaps by a neighbor."

Really important to analyze the HBU of the land.

 

[John Hassler]

Great assignment. CA has not allowed landlocked parcels to be created for longer than I've been appraising. Also, the law has been favorable to forcing easements to be created over neighboring parcels at the market value of the easement; of course this does not include legal fees so this avenue is not financially practical for many properties.

You noted that neighbors has sold out to the state for public use. What have other properties sold for to the state in the immediate area or elsewhere?

Time adjustments can usually be well supported so going back 5-10-15 years for data would not be unreasonable.

In the past, when I've had such assignments, I would search by assessor book and map pages for all potential similar sites and then review each one, including prior arms-length-sales, to assemble a matrix of sales on a price per (insert metric) basis that is corrected for date of sale. Despite a few outliers, a pattern will usually form. Again, great assignment, charge an appropriate fee, enjoy!