Can anyone share their thoughts on value of land in King County?

Question

There are all these run-down houses in the King County area. Many of them are in a great location. However, most of them want $1M for it but the only valuable thing on them is the land.

Would anyone like to have a discussion on this? So we can all agree to the value of property in the outskirts of Seattle/Bellevue/Bothell/Lynnwood area?

Much appreciated!

All the best,

Alex

Michael Haas · Answer

@Aleksandr Shmidt land can be tough to value accurately. Here's the process HouseHack Seattle goes through to evaluate land deals:

1. Zoning: What is the lot size, zoning, and ADU/DADU potential? How many units can be built on the property?

2. Topography & ECA: Is the lot steep, lots of trees, a river, wetlands, or other environmentally critical areas that will either increase the cost of development or make development impossible?

3. Access: What does the infrastructure look like (street access, water, power, sewer, etc). Can heavy machinery get in and out of the lot for building

4. HOA's / Title / Legislation: Are there any concerns here?

5. Comps: What would we build on the lot, and what is that type of home selling for IN A .5 MILE RADIUS OF THE SUBJECT PROPERTY. In King County neighborhoods and school districts dramatically influence the value, so if its more than a half mile away it may not be a great comp, and will need some adjustment.

6. Value the Land: This is a complex calculation that comes from the experience of multiple new construction and entitlement projects, but if you're getting started or wholesaling you can target spending 30% of the ARV of all completed structures on purchasing the land. That will give you a rough estimate of the value of the land to an investor/developer.

Hope this helps! Reach out to me anytime with questions or to connect.

Sherief Elbassuoni · Answer

Primarely because what can be built on the lot, and the After Repair value.

In King County, We do not have a ton of place for horizonatal expansion compared to other counties.

In some cities of King county, deman is also pretty high because of good schools.

Marnie Oshan · Answer

Hi Kathryn

Every home site is different and each city has their own ordinances, but basically, the value of what can be built on the site, and how much it will cost, will determine the land value. There are a lot of nuances that go into land values, but that's the big picture view. Feel free to send me a message if you have specific questions or have a specific property you are inquiring about. I'd be happy to go a little deeper on this topic.

Marnie Oshan · Answer

This is a very thorough valuation method and the one that any experienced builder would use when determining what they would pay for land. I work almost exclusively in new construction in Seattle and this pretty much the list of qualifiers that are run through by the developers and lenders we work with when looking at acquiring land.

Aleksandr Shmidt · Answer

Thanks Ran

This helps a lot as well. What would be the right way to evaluate a piece of land once I have found one? thanks

All the best,

Alex

Kathryn Pierce · Answer

Could you share more about this? Like tree cover or slopes and how that affects land value? Thanks!

Aleksandr Shmidt · Answer

anything is helpful! thank you for your input, I'm new to this and my friends are doing well down south in Portland, OR. However they don't want to get into our market here. Because of not knowing it well. So I'm trying to get as much insight as I can to get going!

Thanks again Michael

Ran Iarovich · Answer

As an agent, I'd be happy to help you with an evaluation piece of land if you have one in mind. Send me it through private message.

Best

Ran

Aleksandr Shmidt · Answer

Thank you, Marnie

This helps me understand tremendously thank you! If when I find the right piece of land or property with a house that needs to be demolished on it. And it's too much for me to personally do. How can I find investors with more capital than me that I can wholesale to?

All the best,

Alex

Ran Iarovich · Answer

There is more of a concentration of wealth in the middle of King County as you have probably noticed. The farther north or south that you go the less value that you get and the more affordable the land is. The reason land prices are so high in the middle of King County is because of their potential. If you can build a 3,000 sqft house in Bellevue and double your returns through appreciation in 3-5 years then the bet is well worth it. Adding on to this, liberal zoning laws in King County (such as HB111) have created an environment of insane potential for the savvy investor.

Can anyone share their thoughts on value of land in King County?

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