Whenever you buy land for your house, you need to note the different physical characteristics of land because they affect the price of the land you intend to buy.
In the real estate market, there are three physical characteristics of land: Immobility, Indestructibility, and Non-homogeneity.
This article will give you a better understanding of the physical characteristics of land within the context of real estate and why they are important to someone wishing to buy land.
The Three Physical Characteristics of Land
Let’s begin with the first characteristic of land. The term immobility land in the real estate markets means that land cannot be moved from a particular spot to another location.
Improvements and construction can be made on it, but the land itself can’t be moved, and no action can physically move it.
This is why the location of a piece of land has a large impact on its price and demand. Property taxes can also differ depending on where a particular piece of land is located.
An example of this is the price of fuel. Fuel purchased in a city will cost more than fuel bought on the outskirts of an area or neighborhood.
Someone can choose where he or she gets his or her fuel. The fuel itself remains the same, but the price differs depending on where you get it.
That is the inverse of the land’s value. Unlike fuel, land cannot be moved.
Because of this immobility, the land’s surroundings, such as houses and buildings, influence the demand, values, and prices of plots.
Another characteristic of land is its indestructibility or permanence. In the real estate market, it’s one nature of land which states it cannot be destroyed.
In other words, the value and appearance of land can change depending on the changing conditions around it. But as far as the house is concerned, its size, shape, and durability remain the same.
For this reason, property insurance does not cover land but rather, covers the improvements made on it.
If a house gets destroyed, the value of the land it sits on remains the same because it cannot be destroyed. That being said, there are some instances when land does move.
The last characteristic is non-homogeneity. The term non-homogeneity in the real estate market, also known by the terms heterogeneity or uniqueness, means that every parcel of land is unique.
Even when two locations might look the same, the fact of the matter is they are still unique from one another.
Their location, the type of buildings or houses built on them, and their improvements may differ. They also vary in terms of size and shape.
For example, if two parcels of property located side by side may look the same, one of the parcels is closer to the freeway than the other.
Based on this, the plot closer to the freeway has less value than the parcel located farther from the freeway, even if the ownership is the same.
Their difference in location is a good illustration of the uniqueness or heterogeneity of each parcel.
The physical characteristics of land in real estate are important lessons to understand how different parcels are valued, appraised, and how certain factors and improvements affect them.
While there are other attributes, such as the economic characteristics of land, understanding the physical characteristics can help you in your decision-making process when purchasing land.