Land Locked Woods Value

[strum456]

I am thinking of making an offer on a 100 acre parcel of landlocked woods that boarders our farm. The property is rocky and hilly. The only level, possibly tillable section of it (maybe 10 acres) was stripped. So, nothing really grows in that area. I would use the property mainly for atving, snowmobiling and hunting. The lot is wooded, but I don't think there is much, if any value in the trees at this time, except as a long term investment. The land was heavily logged about 30 years ago. There are no market size trees that I could find.
My question is about the value of this property. According to Westmoreland County tax data, the assessed value is a little over $4,000. Assessed value does not equal market value in this area. As I understand it, the assessed value should be multiplied by the "common level ratio" to determine approximate market value.

Here is a link to the CLR site for PA: Realty Transfer Tax

In Westmoreland County, the CLR is 4.41. If I multiply that by the assessed value of $4000, I get $17,640. My first thought is that doesn't seem like much for 100 acres. But, the parcel is land locked, hilly, rocky and remote. I am interested only because this land boarders our farm, so it is not land locked for us.

Is 17 to 18k a reasonable offer, or am I missing something?

Mineral rights would be another topic for discussion. The current owner has tried unsuccessfully for many years to get gas companies to drill on this land. They have had leases, but no drilling ever occurred to my knowledge. How much would the mineral rights be worth?

 

[/pine]

If the land "borders" your property and you owned it...it would no longer be landlocked and you could possibly re-sell it with access as an option...

I would contact an attorney with local knowledge about the mineral rights...

 

[strum456]

I am not really interested in re-selling the land to make a profit. I just want the land for my use and for the use of future generations. The land is still remote, if I did grant access through my farm. From the road, it would be a long way back to the property in question. I've never measured it, but it's probably 600 yards of field and about 200 yards of woods.

 

[dave1949]

Typically, assessments are all over the place and not very consistent. I am not sure taking the assessed value and multiplying it by that factor has a true relationship to the market.

In some places the sale prices of real estate transfers are published and public. Maybe that is true in your area. The tax assessment on properties are public here, so maybe you could look at the assessment on non-land-locked parcels compared to this one, and make a judgement.

Another method is to look ta MLS (multiple listing service) listings on the internet to try to find comparable properties in your area and their asking price. The listing date is often included, so you will know if a property has been on the market a long time--which usually indicates it is over-priced for what it is.

You won't find exact matches, but it gives you an idea. You are probably familiar enough with the area to know why some parcels are priced they way they are.

If you are lucky, you buy it, someone comes to drill and cuts ATV trails for you. :laughing:

 

[Western]

That's sounds "to cheap", I dont think you could by "desert" in the states for that little, even "land locked". What boarders the other sides?

I would call a local realtor and just plain ask them, they should be current on MLS's, possible "comps" and local market trends and should be able to give you a "ballpark" idea.
I have also been told that "mineral leases" run the gammit from 10 years to 100 years, whatever the contract was, they may drill or may not. Just hope they done "strip mine":laughing:
Good luck, nice way to enlarge your acreage and all in one piece!

 

[Tim13]

You can also consult with an agricultural appraiser. They will be able to review land prices in your area based on type of land and type of soil to give you a good idea of the value per acre.

 

[Ken45101]

On something like this, a "fair value" is whatever a willing seller will accept from a willing buyer. "Market value" is meaningless.

You may well find that the current owner has an inflated image of what the land is worth. OTOH, he might be happy to get rid of it at any price.

Appraisers for land like this are terribly inaccurate when they can't come up with decent comps. Yours might be the only offer for the next 100 years. OTOH, there may be some recorded access easement for the land and it could be worth more.

You might check the county records to see what was paid for it the last time it sold. That will give you an idea what the current owner might think it's worth.

Other than that, make an offer of what you think it's worth to you and see what happens.

 

[strum456]

I would call a local realtor and just plain ask them, they should be current on MLS's, possible "comps" and local market trends and should be able to give you a "ballpark" idea.

I talked to a realtor. That is what lead me to using the assessed value and the common level ratio multiplier. He actually has his own number - instead of 4.41, he said it is usually around 6 from his experience. That would be 4000 x 6= 24k.

The realtor explained that the problem with properties like this is that aren't any comps. It is only worth what someone is willing to pay. He also mentioned that financing is extremely difficult to obtain for something like this. That alone may limit me to what I can pay cash.

Someone asked what is surrounding the property on other sides. Woods, an old strip mine, our farm, and another farm.

 

[forgeblast]

I would also go to landex.com if you know the owners name you can check to see what the gas lease says, and then make an offer based on that. If it was an older lease the terms might not be that favorable.
It might run you more then you think to buy the property, the owner might just wait it out and the royalties would be a couple of thousand a month if a gas pad goes in.

 

[dave1949]

$24K is roughly $250/acre. Around here that would be the bottom end for seasonally accessible only by goat trail land three miles past the back of beyond. :laughing:

The lease situation probably has more to do with the price than anything else.

Other than that, like Ken says, offer the least of what it is worth to you and see what shakes out. If the land is really rocky and hilly, and has poor timber now anyways, even in the future it would be a high cost parcel to harvest, which will cut into any income you would get from that.