If you are shopping for homes for sale, don't be surprised if you bump into a home that is listed at a premium price because it sits on a bigger lot than neighboring homes. Before negotiating the purchase of such a property, you need to know how valuable the extra space is. Here are some of the factors that determine the value of such a property:
Size of the Lot
The size of the extra space is usually one of the primary factors determining its value. This makes sense since you can do more with a bigger land than a smaller one. However, don't expect a difference of a few feet to have a significant effect on the price of properties within the same neighborhood.
The Location of The Empty Space
The exact location of the empty space within the compound is one of the factors that determines its value. This is because the location of the lot determines what you can do on the lot or the improvements you can do on it. For example, an empty lot in front of the house is not as valuable as an empty lot in the back yard; it's more convenient to put up extra structures in the back yard than the front yard.
How the Lot Can Be Used
Just because there is an empty space in a compound it doesn't mean that you can use it any way you like. Things like zoning laws and easements may restrict the types of improvements you can do on the lot. Even the local homeowners' association may have a say on the use of the land. The more restrictions there are on the land the lower its value falls.
Whether the Lot Can Be Carved Out of the Property
Another thing you will need to consider is whether the extra space can be subdivided into a separate property or its situated in such a way that it must be part and parcel of the home compound. In fact, it's not just the location that determines whether the lot can be curved out of the property; even local laws may have a say in the matter. The value of the extra space will increase significantly, however, if it can be curved out.
As you can see, lots of factors determine the value of extra space in a home compound. Therefore, consider the above factors before paying a premium price for a house just because it sits on a bigger compound than neighboring houses. A real estate agent can help you with the valuation.