Posted by Drew(Va) on October 12, 2007 at 21:03:09:
I was thinking of a lease that has a term or for the life of the owner, the place does have an associate I guess I could approach them in addition. Property is in Red Mill. I guess I’ll have to have them tell me what they are willing to pay and either say yes or no. I’ll also approach the homeowners association to see if they give a better price, and avoid conflict.
Plz Cmnt- How much you pay in this Land Situation? - Posted by Drew(VA)
Posted by Drew(VA) on October 11, 2007 at 14:13:50:
What would you pay for this land in this situation?
I am the lucky owner of a “worthless” yardstick shaped land locked lot. It’s 20 feet by 500 feet long. The great thing about it is it’s being occuppied by 5 people. I presume they believe it’s their land, or just figured no one would ever know. Its in the middle of a subdivision of $350,000 homes (our median price is $225,000), the lot is like a donut hole if you think about it, surrounded by homes, no way to really get to it, or even use it. But I’m thinking I can lease it to the homeowners who currently have sheds on it, and an inground pool touching it. The 2,000 sq foot of land is between 1/8 and 1/4 of the size of the actual lot. (8,000 sq ft lot, now 10,000 with my extra slice.) All 5 lots land is assessed for $130,000. My lot, $500. No one has paid the property taxes on it for the last 3 years until I bought it and paid the taxes.
So what would you pay, as a homeowner, a year to lease the land to avoid losing your shed or moving it, and moving your fence line in 20 feet?
What would you pay, as a homeowner, for the whole lot if I subdivided the part they thought was theirs?
How much you pay in this Land Situation? - Posted by Natalie-VA
Posted by Natalie-VA on October 12, 2007 at 12:03:25:
Hi Drew,
Sounds like fun! If I were one of the homeowners, I would not lease the land. I would either buy it from you or tell you to sue me to move my shed. I wouldn’t pay more than a couple of thousand dollars for the 20 foot extension to my lot. That’s only if I had money lying around.
I think the most important thing here is going to be how you approach them. Let us know how it turns out.
–Natalie
Ground lease? - Posted by Mary (CA)
Posted by Mary (CA) on October 12, 2007 at 11:34:35:
Wouldn’t this be a land lease? Very creative, btw.
My notes (gathered from a variety of sources)on pricing ground leases, says that you determine the required rate of return on the market value of the land.
If you can figure out the value of your lot (probably discounted for being landlocked), then say you want a 7% return - then 7% of the value would be the lease amount NOW. You might try for a NNN - and require users to insure for liability and pay all your taxes. Then it would be a pure cashflow situation for you. Don’t forget to allow for rent increases, tax increases, etc. (you might check out some of the HI websites, as a lot of HI properties are still on land leases).
As for adverse possession, if taxes hadn’t been paid, it wouldn’t be possible in the normal scheme of things, unless your state rules don’t require taxes to be paid for AP, so you may be ok there. However, you can’t say that someone only has 3 years of use - they can tack on the prior owners’ use too to get to the required years. You’re lucky if it’s 15. Here in CA, it’s only 5 years.
You should, however, expect the homeowners to be rather hostile to your “Dear Homeowner, I own the strip of land you’re using for your swimming pool. The current rent will be $X plus taxes, payable monthly at $x/month with COLA increases each year ad infinitum. Please remit your rental payments, payable to [you] to P. O. Box 1234, your town, state by the 1st of each month.”
Have you looked into whether you are entitled to an easement for the property? A local real estate attorney can tell you whether your state law provides for this.
In a lot of situations, if the property was ever owned in conjunction with property with road access, you’d be entitled to easement. Think billboard rental, cell phone towers, etc. (yes, the homeowners will absolutely hate you.)
Mary
How much you pay in this Land Situation? - Posted by Ed in Idaho
Posted by Ed in Idaho on October 11, 2007 at 21:52:37:
Depends on your morals. How about building a 6’ high neon pink fence right down the middle of the property. How much would it be worth then? how about storing old school buses on the property. I myself would not do these things, but they have been done before.
Anyway I myself would try not to be too greedy, but I would definitely try to make a profit. $130000 / 8000 sq ft is $16.25 per sq ft X 2000 = $32,500. Don’t know what you paid for the property but I bet it wasn’t much. Depends on your morals and what a good profit to you would be and if you could get the owners to agree to that price, if they even need your land at all. The wrench here is that your asking somebody besides the homeowners themselves. Ask 10 different people you will get 10 different answers.
Do the Google trick with the archives because I know there are people on here who look for these types of properties. Find them young jedi, and may the force be with you!
Re: Plz Cmnt- How much you pay in this - Posted by Frank Chin
Posted by Frank Chin on October 11, 2007 at 16:12:51:
Drew:
Assume you checked out the applicable “adverse possession” issues invloved.
Frank Chin
Owner finance the land! - Posted by Drew(Va)
Posted by Drew(Va) on October 12, 2007 at 12:52:17:
I could pay to subdivide the land, and owner finance it to them with a downpayment. Or just an easement for 1 year for 500 bucks or something.
And about their shed, I was thinking I’d just walk the fence line, drop into the property and put a new lock on the shed. Tad Da! It’s mine now suckers. The problem is the leverage I have, it’s not much, if they don’t move the shed, it’s not like I can call the police for trespassing. Plus an easement probably wouldn’t hold up in court, the land isn’t livable, so they wouldn’t necessarily favor me in this situation.
I’ll update everyone, I’m just scared to tell them it’ll be $100 a month and they say no way. It only cost me $100 for the lot…
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Re: Plz Cmnt- How much you pay in this - Posted by Drew(Va)
Posted by Drew(Va) on October 11, 2007 at 16:42:44:
“The court stated that to establish title by adverse possession in Virginia, a claimant must prove â??actual, hostile exclusive, visible and continuous possession, under a claim of right, for the statutory period of 15 years.” In this case although the claimant met all the other requirements, it was unclear whether or not they (or their predecessors in title) had received permission for their initial use of the property."
Only 2 person would qualify had they ever gotten actual permission to use the land, which went from a “right of way” to actual deeded property. All the other owners have owned for less than 3 years.
So presuming no one has permission from the originial owner, which, once sold may or may not transfer, how much would you pay for it Frank? I just need a ballpark, and I don’t know where to start.
Re: Owner finance the land! - Posted by Natalie-VA
Posted by Natalie-VA on October 12, 2007 at 16:04:52:
Oh! Sorry, it didn’t occur to me that you had to pay to subdivide it first. Duh. I agree that you don’t have much leverage, so the approach is going to be important. How about a long term lease of 100 years, or maybe for the time they own the property…then it reverts back to you? Is there a homeowner’s association that might buy it and then do the subdividing work and sell it to them?
I don’t know…just some ideas. I wonder if you’re talking about Foxfire. No need to disclose if you don’t want to. I’ve noticed some strange fence locations that don’t match up and what I assumed were easements when I was walking around.
–Natalie