Real estate terms can be confusing, with assumptions that everyone understands their meaning. However, this is not always the case. While some terms may sound straightforward, there can be hidden complexities behind them. Understanding land use is crucial for land buyers, sellers, and owners. This guide provides definitions, highlights the importance of land use, and discusses common types of property.
What is land usage?
According to the U.S. Environmental Protection Agency, 'land use' describes the human use of land. It’s the intent people apply to the land available to them. More specifically, 'land use' is the characterization of actions people apply to land for various purposes. This is often dictated by the natural resources the land provides and historical use along with whether the land is public or private.
Why is land usage important?
When buying land, it's crucial to ensure that you can use it for your intended purpose. The "perfect" property may not be suitable once you determine its land use. Whether you want to build a house or engage in agriculture, make sure that the properties of interest are zoned and designated accordingly.
What is vacant land?
Vacant land is real estate without significant structures. It's also known as unimproved or undeveloped land. It has the potential to be a versatile asset that appreciates in value because it can be improved or developed. Some vacant lots are buildable, depending on topography and zoning laws. Vacant land may have improvements like utilities or driveways and still be considered vacant.
What is undeveloped land?
Undeveloped land refers to real estate without any improvements such as buildings, driveways, or public utilities. It remains in its natural state, untouched by significant human intervention. Due to limited supply and increasing demand, undeveloped land has appreciated in value over time across the country.
What is real estate?
'Real estate' refers to real property consisting of land and the improvements on it, along with its natural resources. The improvements may be natural or unnatural. These improvements include homes, office buildings, apartments, garages, and other structures, but also trees, minerals, and crops.
What are the different types of real estate for land?
Throughout history, people have utilized land for many different purposes, each with its own distinct intent. Today, the major types of land use encompass a wide range of activities, including agricultural practices for cultivating crops and rearing livestock, commercial endeavors for business and trade, recreational activities for leisure and enjoyment, residential purposes for dwelling and habitation, and transport infrastructure for facilitating the movement of people and goods. These various forms of land use collectively shape the landscape.
Agricultural land use
Producing crops and raising livestock is one of the oldest forms of land use. Agricultural land is land devoted to the controlled use of any form of life to produce food for people and is often referred to as cropland or farmland. With more than 900 million acres of land, agricultural land makes up approximately 40% of the total land area in the United States, as reported by the USDA's Census of Agriculture. This vast expanse of land is divided into two major categories: cultivable land and pasture land.
Cultivable land, also known as cropland, is dedicated to the production of various crops such as corn, soybeans, and wheat. It serves as the foundation for the agricultural industry, providing the essential resources for food production and sustaining the nation's economy.
On the other hand, pasture land is primarily used for cattle grazing. It offers rich grasses and vegetation, creating an ideal environment for livestock such as cattle, sheep, and horses to graze and thrive. This not only supports the livestock industry but also contributes to the production of high-quality meat and dairy products.
Recreational land use
Recreational land is property used for personal enjoyment. The point is to have fun and provide relaxation in the outdoors. This could be privately owned land or property owned by a government entity. It could include anything from city parks and open spaces to national parks and large tracts of hunting land. Some examples of recreational land use include ranching and hunting, along with camping and fishing.
Commercial land use
Commercial land refers to property designated for business activity or commerce, aimed at generating income. It plays a vital role in city land use planning and contributes to the overall health of the local economy.
Commercially designated land is appraised differently, with varying values. Even if not zoned as commercial, it can still be valuable if in the path of economic growth. For example, commercial property is often leased for rental income. Commercial land use includes retail stores, restaurants, hotels, and warehouses.
Residential land use
Residential land refers to property that already has a residence or is suitable for building one. It is typically zoned for primary housing and is sought after by individuals who wish to build their own homes. Residential land values fluctuate based on location and various factors. For example, residential beachfront land is often much pricier compared to similar-sized lots located a few miles inland.
It is important to mention that there are often restrictions associated with residential land use. Zoning restrictions for residential land use vary from one city or state to another. These restrictions can include the types of materials that can be used to build, the overall size and height of the residence, and the type of animals allowed (if any are permitted).
Mixed land use
Mixed land use refers to the combination of different types of land uses on a single property. While it can include various types, the most prevalent form involves a blend of commercial and residential land use. For example, a property with mixed uses could include a ranch that has both a home and farmland.
Transport land use
Transport land is real estate that is designated to the moving or transportation of people and goods from one place to another. The majority of transport land, which is owned by government entities like the city, requires extensive land use planning. This involves careful coordination and may even necessitate the involvement of land use consultants. Their expertise is invaluable for maintaining, upgrading, or even developing new transportation land to ensure efficient and effective transportation systems for the community. Transport land use includes airports, roads, subways, and trains.
Urban land use
Urban land use can be defined as land used for retailing, management, manufacturing, residences, or industrial activities. These activities aim to benefit the local economy and community to ultimately increase the development in a certain location. Urban land use plays a crucial role in not only enhancing the quality of the area but also safeguarding the environment and its precious natural resources. It is imperative to acknowledge that significant changes in land use can have far-reaching effects on water resources, delicate ecosystems, and the land as a whole.
How to Determine the Best Use Case for Land
There are many qualities that contribute to how land can be used. Zoning, easements, climate, topography, and biology are a few. Fortunately, there’s land for sale out there for whatever you’d like to do. Understanding land use policies and property types are a piece of the puzzle to help set you up for success in your search.
LandGate's property report can provide landowners and realtors that are selling land with data to help determine its suitability for different potential use cases. This data can be used to market their property effectively for the most value.