How Do I Know What Vacant Land Is Really Worth?

Figuring out what a house is worth can be complicated.

Figuring out what vacant land is worth can sometimes feel like everybody threw numbers into a hat.

You may find two five-acre parcels in the California High Desert listed for dramatically different prices.

One is $12,000.

Another is $45,000.

Another seller wants $90,000.

Then you find a ten-acre parcel for less than all three.

What exactly is going on?

The first thing to understand is:

Vacant land isn't worth a certain amount simply because it contains a certain number of acres.

Location, access, water, utilities, zoning, terrain, development potential and dozens of other characteristics can affect what buyers are willing to pay.

So if you're trying to determine what High Desert land is really worth, you have to compare more than acreage.

Start With What Similar Land Has Actually Sold For

Asking prices are interesting.

Sold prices are evidence.

If I'm evaluating a vacant parcel, I want to see what reasonably comparable properties have actually sold for.

Not simply what other owners hope their land is worth.

A seller can list five acres for $150,000.

That doesn't make the five acres worth $150,000.

It means somebody is asking $150,000.

Those are two entirely different pieces of information.

What Makes a Vacant Land Sale Comparable?

This is where land gets interesting.

Two properties don't become good comparables simply because they're both five acres.

I'd want to compare characteristics such as:

• Location
• Lot size and configuration
• Zoning and permitted uses
• Water availability
• Electricity
• Legal access
• Physical road access
• Terrain and usable acreage
• Flood and drainage conditions
• Easements
• Existing improvements
• Views and surroundings
• Development potential

The more similar the properties are in the characteristics buyers actually care about, the more useful the comparison becomes.

Price Per Acre Can Be Misleading

Price per acre is useful.

It's just not the answer.

Suppose a five-acre parcel sells for $25,000.

That's $5,000 per acre.

Does that mean a nearby one-acre parcel is worth $5,000?

Probably not.

Smaller residential lots can sometimes sell for considerably more per acre than larger properties.

And larger acreage often sells at a lower price per acre.

That's normal.

Land doesn't necessarily increase in value proportionally with size.

Five acres also isn't automatically worth five times as much as one acre.

Five Acres Isn't a Property Description

We've talked about this throughout my High Desert land guides because it's one of the easiest mistakes buyers make.

Five acres tells me how big the property is.

It doesn't tell me whether I want it.

Five acres could have:

A paid water meter.

Electricity at the property.

Paved access.

Flat usable terrain.

Beautiful views.

Or it could have:

No water.

No nearby power.

Questionable access.

Steep terrain.

A wash running through it.

Both properties are still five acres.

They're not necessarily remotely comparable in value.

Location Still Matters

You've heard it forever:

Location, location, location.

Vacant land doesn't get an exemption.

A parcel close to shopping, services, Highway 62 or a desirable community may appeal to more buyers than a property considerably farther into the desert.

But remote land has its own market too.

Some buyers specifically want distance from town and neighbors.

That's why value isn't simply:

Closer to town = better.

It's about demand for that particular type of property.

Joshua Tree, Yucca Valley and 29 Palms Aren't One Land Market

Even within the Morongo Basin, buyers can have different expectations and motivations.

Joshua Tree has strong name recognition and proximity to Joshua Tree National Park.

Yucca Valley generally offers more established services and development.

Twentynine Palms can offer opportunities for inexpensive acreage and more remote desert property.

And within each community, there are submarkets.

Five acres near central Joshua Tree isn't automatically comparable to five remote acres several miles away simply because both listings say “Joshua Tree.”

Look at the actual parcel.

Water Can Affect Land Value Substantially

If you're comparing two otherwise similar properties and one already has a paid water meter while the other has no established water service, that's meaningful.

Water infrastructure costs money.

It can also remove uncertainty.

But even here, don't simply add the cost of a water meter dollar-for-dollar to the land value.

Real estate markets don't always work that neatly.

The question is:

How much more are buyers actually paying for properties with that advantage?

That's what comparable sales can help reveal.

Electricity Can Affect Value Too

A parcel with electricity directly at or near the property may appeal to more buyers than a remote parcel where extending conventional power could be difficult or expensive.

But the value difference depends on the buyer pool.

Someone planning an off-grid solar system may care much less.

Someone planning a conventional home may care considerably more.

Again, value reflects what buyers in that particular market are willing to pay.

Access Can Make or Break a Property

A parcel with paved frontage is a different product from land requiring several miles of dirt-road driving.

And a reasonably maintained dirt road is different from deep sand or a rough trail.

Then there's legal access.

A property that appears accessible physically may have title or easement questions.

Those issues can reduce the number of buyers willing or able to purchase the property.

**Remote can be desirable.

Inaccessible is something else.**

Usable Acreage Matters More Than Bragging-Rights Acreage

Five acres of relatively flat usable land may offer far more development flexibility than five acres of steep hillside.

A buyer shouldn't simply ask:

“How many acres am I getting?”

Ask:

“How much of this property actually works for what I want to do?”

Terrain, drainage, setbacks, easements, protected vegetation and other constraints can affect usable area.

More acreage isn't necessarily more useful acreage.

Zoning Affects Value

What can legally be done with a property matters.

Residential land isn't necessarily comparable to commercial land.

A parcel that allows a particular use isn't automatically comparable to one where that use isn't permitted.

Even among residential properties, zoning standards can affect lot size, setbacks, animal keeping and other development possibilities.

And remember that jurisdiction matters.

Yucca Valley has its own development regulations.

The City of Twentynine Palms has its own regulations.

Unincorporated areas such as Joshua Tree generally fall under San Bernardino County.

For 29 Palms land in particular, determine whether the parcel is actually within the City or in unincorporated County territory.

Don't use the mailing address to determine the rules. Use the APN.

Buildability Affects What Buyers Will Pay

A legal parcel isn't automatically an easy parcel to build on.

If one property has straightforward access, water, electricity and usable terrain while another requires substantial investigation and infrastructure work, buyers may price that uncertainty into their offers.

This is why cheap land can remain cheap for a very long time.

The market may already understand something about the property that isn't obvious in the listing.

Whenever I see a parcel priced dramatically below seemingly similar properties, my reaction isn't:

“Wow! What a bargain!”

It's:

“Okay. Why?”

Sometimes there is a perfectly good answer.

Sometimes you really did find a bargain.

Sometimes you found a very inexpensive place to own dirt.

Existing Improvements Can Add Value

Vacant doesn't always mean completely unimproved.

A parcel may have:

• A paid water meter
• Previous electrical service
• A permitted driveway
• Fencing
• A building pad
• Previous structures
• Septic improvements
• Survey work
• Other useful infrastructure

Those improvements can potentially add value if they're usable for the buyer's intended project.

But verify them.

An abandoned septic system isn't automatically valuable.

Neither is an old utility connection that can no longer be used.

Existing improvement and useful improvement aren't necessarily the same thing.

Views Can Affect Value

Views are harder to quantify.

But yes, buyers will sometimes pay more for an exceptional setting.

Mountain views.

Open desert.

Rock formations.

Joshua trees.

Privacy.

Dark skies.

A particularly beautiful building site.

Not every component of real estate value can be reduced to the price of a water meter or cost of extending electricity.

Emotional appeal is part of real estate.

Vacant land is no exception.

What About Land Near Joshua Tree National Park?

Proximity to Joshua Tree National Park can increase buyer interest.

But don't automatically add a “National Park premium” to every parcel with Joshua Tree in the mailing address.

Ask:

How close is it really?

How long is the actual drive to an entrance?

Does it have views?

How is the access?

What infrastructure exists?

What makes this particular property desirable?

Don't buy the marketing description.

And don't use the marketing description to establish value.

Is the Assessor's Value the Market Value?

Not necessarily.

The assessed value shown in public records is primarily for property-tax purposes.

In California, Proposition 13 means a property's taxable value can be tied to when ownership changed and then subject to limited annual increases.

A longtime owner's assessed value may therefore have very little to do with what the property would sell for today.

Don't look at an assessor's value of $8,000 and automatically conclude:

“They're asking $30,000! That's ridiculous!”

Those numbers may be measuring two different things.

What About Online Automated Values?

Be careful.

Automated valuation systems have much more data available for typical houses in established neighborhoods.

Vacant land can be harder.

A computer may know:

Five acres.

Same ZIP code.

Similar distance.

But does it know that one parcel has a paid water meter?

Does it understand the difference between an easy dirt road and one where you're reconsidering your life choices halfway down it?

Does it know where the usable building area is?

Does it understand that one property has great legal access and another may have an easement issue?

Maybe some of that information is available.

Maybe it isn't.

Use automated values as information—not as unquestionable truth.

What About What the Seller Paid?

Interesting.

Not necessarily relevant to today's value.

Maybe the seller bought the property 25 years ago.

Maybe they inherited it.

Maybe they purchased it at a tax sale.

Maybe they overpaid.

Maybe they got an incredible deal.

What the seller paid doesn't determine what today's buyer should pay.

Today's market does.

What About What the Neighbor Is Asking?

Again:

Asking isn't selling.

If three nearby owners are asking $60,000 and similar land is actually selling for $30,000, I care considerably more about the closed sales.

Active listings do matter because they're your competition.

But they don't prove value.

They show what buyers can currently choose from.

How Long Has the Land Been for Sale?

Market time can tell us something too.

If comparable properties routinely sit for a year or longer before selling, that's information about demand.

If desirable parcels sell quickly while certain types of land repeatedly expire unsold, that's information too.

Price isn't the only market signal.

Buyer behavior matters.

Why Is Vacant Land Sometimes Harder to Price Than a House?

Imagine a subdivision containing 200 nearly identical houses.

Same builder.

Similar square footage.

Similar lots.

Several have sold recently.

That's a relatively straightforward comparison.

Now imagine 200 desert parcels.

One has water.

One has a well.

One has power.

One is off-grid.

One has paved frontage.

One requires two miles of dirt road.

One is flat.

One is hillside.

One has panoramic views.

One has an easement across it.

One is half an acre.

One is twenty acres.

Welcome to vacant-land valuation. 

Highest and Best Use Matters

In professional appraisal, land value is also connected to what's known as the property's highest and best use.

In simple terms:

What use is legally permissible, physically possible, financially feasible and supported by the market?

That doesn't mean every buyer will use the property that way.

But development potential can affect what the market is willing to pay.

A property with realistic residential development potential may have a different value from land with significant limitations.

The Market Doesn't Care What You Need to Get

This applies to sellers.

Maybe you paid $40,000.

Maybe you spent $8,000 on improvements.

Maybe you'd like to net $75,000.

I understand.

But those numbers don't establish market value.

Buyers compare your property with their alternatives.

The land is worth what the market will support—not what any of us would particularly like it to be worth.

The Cheapest Parcel Isn't Necessarily the Best Value

Price and value aren't the same thing.

A $12,000 parcel may be cheap.

A $35,000 parcel with better access, useful infrastructure and a more desirable location may be the better value.

Or the $12,000 parcel may be exactly what an off-grid buyer wants.

There isn't one answer.

That's why we have to understand the buyer's goal.

How I Would Compare Two High Desert Parcels

If you showed me two properties and asked which was the better value, I wouldn't start by dividing the price by the acreage.

I'd start with the actual properties.

Where are they?

How do you reach them?

What's the water situation?

Where is the electricity?

What's the zoning?

What jurisdiction controls them?

What's the terrain?

Are there easements?

What has actually sold nearby?

And then:

What do you want to DO with the land?

Because a parcel can be fairly priced and still be completely wrong for you.

So How Do I Know What Vacant Land Is Really Worth?

Start with recent sales of genuinely comparable vacant land.

Then look at the differences.

Not just acreage.

Look at:

Location. Water. Power. Access. Zoning. Terrain. Improvements. Title. Views. Development potential. And buyer demand.

That's how you begin to understand why one five-acre parcel sells for $15,000 while another sells for $50,000.

There's usually a reason.

Your job is to figure out what it is.

Thinking About Buying or Selling High Desert Land?

I work with vacant land throughout Twentynine Palms, Joshua Tree, Yucca Valley and the surrounding Morongo Basin.

If you're looking at a parcel and wondering whether the asking price makes sense, send me the APN.

If you're thinking about selling and wondering what your land may be worth, I can look at the property and the relevant market activity.

Because with vacant land, simply knowing the acreage isn't enough.

**Five acres tells us how much dirt you're buying.

It doesn't tell us what the dirt is worth.**

Contact Dawn Anderson, Broker — Sell29.com

Dawn Anderson is a California real estate broker serving buyers and sellers in the High Desert. This information is provided for general educational purposes and is not legal, planning, zoning, surveying, engineering, environmental, water, wastewater, utility, investment or permitting advice. San Bernardino County zoning and development standards can change, and map suffixes, overlays, community plans, environmental regulations and parcel-specific conditions may modify general standards. Buyers should independently verify the complete zoning designation, permitted uses and proposed project with San Bernardino County and appropriately qualified professionals before purchasing or developing property.