How to Compare Prices of land by Acre. If you’re searching for a parcel of land, and you prefer something over an acre, you’ll require to know how to compare prices and properties consistently. There is a lot that goes into the process.
How Much Land Do You Need?
You desire to build your dream home or another structure, and you need to understand how much space you require. We’re going to go with building a home in this example since there is a lot of data to go off of.
If you were building a house in 2013, the average lot size was 0.35 acres.
And don’t forget that the lot size does have its valuation. For instance, if you build a 2,000-square-foot home on a 3,500-square-foot lot, its price would be much lower than if you build the same home on a 15,456-square lot.
Why?
The lot will be more profitable since a person will have a backyard or a place to plant a garden, on the other hand, a smaller lot won’t provide this possibility. If you desire to build a small farm or a farm used to sell products as a business, you would require a larger lot. Information from the USDA provides the following figures as the average:
1-Small farms 230 acres
2-Large farms 1,420 acres
3- Very large farms 2,085 acres
Please consider that 90% of the country’s farms are small. Commercial opportunities are very difficult to evaluate in terms of size since a commercial entity can be virtually anything. You can have a small apartment or a large shopping mall that takes up 100 acres of land.
Finding Average Land Prices by Acre
The average land price by acre will change significantly from one city to the next, and even one portion of a city to the next. If you move towards a city center, the price of land will increase in virtually every corner in the United States. The USDA provides land values, and most of the information provided deals with primarily farm and pasture land. However, these figures give us a great indication of what to expect at the minimum for land values, and the breakdown is done categorically by state and type of land to make it nice and neat to view.
Please consider the following important data points:
The value of all buildings and land on farms averaged $3,000 per acre, up 2.4% from 2014.
Pastureland averages $1,300 per acre.
Cropland averages $4,100 per acre.
The best data point to utilize in this case would be the $3,000 per acre because it accounts for land with buildings. However, the price in New Jersey is close to $12,500 per acre of land. Therefore, comparing averages is difficult.
When you look at a city itself, you may find that near the city’s downtown area, the price per acre is $10,000, while a mile down the road, prices are $4,000 an acre. Data lists are not compiled for most cities because of the high difference between prices. In most cases, there are several variables to consider on the city level for any data to be useful when purchasing land.
A suitable way to properly determine the average value would be to investigate a certain city and deduce your average per acre.
Determining Average Costs Per Acre
Calculating the average cost per acre can be done mathematically. You can use the following data:
1 acre of land = 43,560 square foot
.75 acres of land = 32,670 square foot
.5 acres of land = 21,780 square foot
.25 acres of land = 10,890 square foot
If you find some lots that are 0.12 acres, you would require to do the following to calculate how much the land is per acre:
43,560 * .12 = 5227 (square feet)
43,560 / 5227 = 8.33
Utilizing this equation (0.12 comes from the acreage amount), we can then multiply the price of the land (say $1,000 for a 0.12-acre lot) by 8.33. This ($1,000 * 8.33) would mean that this lot is priced at $8,330 per acre. While this may seem complex, it allows you to determine how a piece of land is priced in terms of an acre. Furthermore, if the property is listed in only square feet, you need to divide it by 43,560.
If you prefer to search for land that has over one acre, you would look for properties that have lots of 43,560 square feet or more.
Comparing Prices of land by Acre
Comparing prices by acre is unconventional. Consider two 0.5-acre lots. Each of them can sell for thousands of dollars. The difference is the location, type, and buildings on the property. So, all of these issues will play a factor in the cost of the property. Also, simple things such as water access will make the land more valuable.
When you want to select two lots of land with similar acreage, Consider the below factors
1-Utility access
2-Water hookup
3-Proper irrigation
4-Land clearing
5-Paved roads
All of the above mentioned factors affect the price of building on the land. If both properties were identical, the location would be the most crucial price factor, and purchasing the cheaper lot is better.
Once dealing with farmland or cropland, the quality of the land should be considered.
One reason to diminish land price is the low quality of soil since in this case, the soil would require a lot of investment to bring it up to a suitable quality level. The higher quality of the soil results in more demand and price per acre simply because it will produce a higher level of crop.
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