What's the advantage of working with a land agent when purchasing land? We walk you through the special expertise - and connections - land agents offer.
Anne Barnett, owner and president of Southern Property Services Inc. in Gainesville, Florida, describes the benefits derived from an expert when purchasing property. The veteran land agent has worked in real estate for 28 years and has been a part of the independent broker network that works with Raydient Places + Properties, the company that manages Rethink:Rural, for the past seven years.
“There are many differences in regard to marketing land and marketing homes or commercial property,” says Barnett. “One difference is the actual showing of the property. It is important to get your buyers on the land. Knowing what you are looking at from aerial maps is of major importance. [Land agents] have four-wheel drive vehicles and can both drive the land and walk it. Most ‘traditional’ residential Realtors do not do either.”
What else can land agents do?
- Land agents understand regulations that pertain to zoning, such as the various floodplain classifications and the difference between wetlands and the 100-year floodplain.
- Land agents know ways to resolve issues, such as limited access; survey issues, such as encroachment title defects; and mineral rights and royalties problems.
- They can help obtain land loan financing.
- They can work closely with foresters to estimate the value of the timber on a property.
Land agents consider what Barnett calls the “Highest and Best Use” of the property to determine an appropriate price, she explains.
“Certain components create the potential use and subsequent values for vacant land,” she says.
- zoning/land use;
- physical site characteristics; and
- market data.
“A land Realtor is aware of these components and their impact on a property and will do research so that she understands what can be done with the property.”
She adds, “In my view, it isn’t ‘location, location, location’ as the old adage says. It is ‘zoning, location and site characteristics.’”
Why Zoning and Land Use Matter
“You can have a beautiful, well-located property but, because of its zoning or land-use classification, you find that it’s not adaptable for the intended use,” Barnett explains. “Regulations pertaining to zoning -- such as the density that permits development, subdivision regulations, and the floodplain -- can affect use of the property and permitting. As a land agent, it is our job to delve into that aspect of a property we are either listing or presenting to a buyer.”
That includes contacting the zoning department and talking with knowledgeable people there.
Barnett, who has developed entire subdivisions, says, because residential Realtors aren't aware of the process, they don’t know how to take that extra step for their clients, and most buyers don’t know the right questions to ask on their own. For example, she says, even a sizeable tract of land might be zoned for only one house. The property owner might be disappointed if he had larger housing plans.
“Maybe he wanted his kids to build and live there, too,” she says. That’s the type of discovery a land agent is trained to make.
How Site Characteristics Impact a Property’s Value
”As land agents, we know the use of a property can be significantly impacted by wetlands or the floodplain,” she notes. “We use several sources to locate the information – Water Management Districts and Zoning Departments are the most helpful.”
Access is also crucial toward a property’s use. “If the access is limited, it is likely that the potential use will be limited,” Barnett says. “A survey is a good tool to determine what kind of access a property has. Landlocked property can sell, but it is very important to let the buyer know what his options are.”
For more information about access, read our article about different types of access and how to obtain access on landlocked property, here.
Other considerations for land agents and their clients: Does the property have a road? Utilities? Trees that are harvestable? All of these can add or detract from the value of the property, Barnett says. Beauty, too, plays a role. While hard to quantify, physical attributes such as a lake, “affect the desirability of a property,” she says.
How Land Agents Use Market Data
A land agent can analyze the “Highest and Best Use” of the property to the prospective owner’s advantage.
“For instance, a tract of land may have been planted in pine with the intention of harvesting it in the future,” Barnett says. “It’s easy to think of it as a ‘timber’ or ‘hunting’ property. However, if the research shows that the property has a higher-density zoning and good access, it may be considered a development tract at a higher price, as opposed to a timber tract at a lower price.”
To determine such potentially profitable findings, land agents “have to get a sense of what the market is looking for,” Barnett explains. They also must do their homework, not just accepting a property description but asking questions and getting details.
"If you are appraising property, it is important that you verify all the data collected with parties to the transaction -- buyers, sellers, Realtors -- so that you know your facts are correct,” she says.
How to Find a Good Land Agent
The same websites that advertise property sales also have ads for agents who specialize in land.
“Ask how long they have been working with land, what they have sold over the years – farmland, commercial property, residential property?” she says. “Find out if land is their specialty, and if they walk the property with their buyers. Ask them if they have land-oriented specialists that they work with – surveyors, attorneys that understand the legal issues of land, lenders that lend on land, land-clearing companies, environmental professionals, etc.”
Look for land agents that know major landowners in the area near the property being considered for purchase.
“There are many issues that can be resolved with the help of area property owners,” Barnett says. “We have experienced encroachment issues, access issues, and title issues that have been remedied with the help of a neighbor. Also, for an agent in a certain area, name recognition and expertise recognition would be very important and helpful.”