Blog: R.E. Tales
(Hey, they're not all pretty...)
Abstract of Title
New York is called “an abstract state”. This does not mean our attentions are diverted, but rather that we typically convey title through the use of an Abstract of Title to establish what is called the “Chain of Title” (history of ownership). More common in the US now is the use of Title Insurance and a lot of the big firms that deal all over the US, make the incorrect assumption that Title Insurance is what we want here as well, so that’s what we get, whether we actually want it or not. Personally, I disagree with this, not that they listen to what I say. Either can be used to convey good title, but the insurance ends when I sell the property. With an abstract, all that needs to be done is have it updated then given to the next owner.
Once I get a Purchase Contract signed, the next step (assuming it is a cash sale) is to send the abstract out for updating. This means the seller has to deliver it to his attorney. If he can find it that is. So many can’t, and a frantic search ensues. After all, they haven’t looked at it or even seen it since they bought the place they are now selling. They will triumphantly produce the Deed. But we can get copies of that easily from County Clerk where they have been filed. Abstracts are not filed in New York and, until recently, not even copied. Some firms now provide digital copies, a huge improvement by my way of thinking. If your county files are converted to digital then the main reason abstracts are not filed disappears (lack of space - they get bulky). Some states have gone ahead have these routinely filed at the County Clerk’s. But not New York. You are responsible for it.
So you are in the middle of your frantic search and you realize you may not recognize it even if you found it. It may not say “Abstract of Title” on it. What does it look like? Most are on legal paper (8.5x14”) and have covers of colored somewhat heavier paper, stapled at the top. All but certainly, it will be fairly thick. I have seen them way over 100 pages. On the front is probably a tax map of the land. Inside will be all sorts of legal documents pertaining to the property: old deeds, wills, easements, various maps, deeds of neighboring properties which once may have been part of yours, foreclosure documents, mail receipts, mortgages, marriages and divorces information, tax searches, memorandums, copies of judgements, purchase contracts from the past, lis pendens (notice of a pending legal action), and certification of the abstract. If you can stand to wade through all this, it gives a legal history of the premises. Not everything mentioned above will be in each abstract - and there may be other documents someone once thought important to add.
Suppose you cannot find it at home, what now? Find out which attorney represented you when you purchased the property. He may have it in his files. Or check with the bank if you had a mortgage. Sometimes they have them. I have an abstract here of a place I sold 20 years ago. It had been at my lawyer’s who has since retired. When he gave me all my files, I found it in there. I called the current owner and told him I had it, but it should be in his records, not mine. He thanked me and probably promptly forgot about it. If he ever decides to sell, he is going to be frantic. Unless he remembers I have it, it will cost him an un-needed bundle and some lost time to recreate it.
Now how did it come to be in my files? I am not sure but when I sold ti, I carried his mortgage. That would explain how it came to be there, even though I was not in the habit of holding onto the abstract in such cases. There ware quite a few over the years, but this one, for some reason, was the only one my lawyer had retained. Or it could have simply been mis-filed. There are abstracts of property I own that are missing. I wonder where they ended up in? I keep such things in my safe and no where else.
Another lawyer had a flood in his office and lost all his older files. Not only his but the ones his father had before him, 2 generations worth. When all those folks need their abstracts, there will probably be a hundred grand spent creating them. Typically we go back 40 years in our abstract searches, so some of the abstracts, say those from 50 years ago, will be interesting perhaps, but not terribly useful.
After the abstract is updated, it is sent to the buyer’s attorney, who reads through it to give his opinion as to who he feels the legal owner is. If he feels someone else may have a legal interest in the property, then he’ll let the sellers attorney know about it and then they will have to do whatever is necessary to rectify this. We had one case recently where the title over time had passed through 4 different lawyers in various sales, each of whom was satisfied that the title was good. Not one ever challenged it. Then it got to the 5th lawyer who found something he didn’t like. It seems way back when there were like 17 heirs and when it was sold; one was feuding with the others and failed to sign off. As luck would have it, he was still alive. And still mad. This all happened so long ago that the Statute of Limitations had long passed, meaning he couldn’t have done anything about it if he had wanted (you have so many years to enforce your rights and if you fail to do this, you lose any rights you thought you had). He’d long ago lost his rights to complain. and, to be fair to him, he wasn’t complaining, not making any waves for subsequent owners. But he wasn’t signing anything either. The buyer’s lawyer would not let the closing take place until another lawyer, the owner of a title company, agreed to insure the title. Everyone knew there was no problem that had any chance of being informed, but the buyer’s lawyer didn’t want his client in any difficulty in case another lawyer surfaced who did not understand that the sorehead’s rights had long been extinguished.
ROW = Right of Way, the legal right of one party to enter lands of another in order to access their own land. It is a form of easement. And is typically used when a parcel is landlocked, as it saves you having to own a helicopter or a huge pogo stick to get to your land. But it is also used in other circumstances.
One I am working with now is a great example, a 118 acre tract with lots of road frontage on a paved year-round road. Only a creek parallels the road, too closely. To build between it and the road. You have easy access - if you don’t mind wading. And on the other side it’s steep. There used to be a Town road through the property, coming downhill to the paved road. It is now legally abandoned in that area and the bridge is long gone. There is a seasonal road in the back that goes right to the property. It used to lead down to the bridge, but it also veers off along the side. Except the last bit of this road before our 118 acres begins is now also private land and though it looks good, the Town no longer maintains it. You cannot tell on the land where it ends legally, but definitely the owner of the 118 acres does not have the right to use it without permission. It’s a “so near, yet so far” case.
With the road frontage there, you will not get any help from the State. You have ample access, just not by car. But take heart, we discovered a survey map and on it is, yes, a Right of Way, one that lead up a nice driveway off the paved road and then a short distance off it on in to the property. It is 20’ wide, not really enough by modern terms, but it’s perfectly legal and ample to drive a car in and even pass another. You just can’t turn a fire engine around on it, which is what some Towns want in new ROWs. Along with the right to pass here is normally the right to improve ti to whatever standard you may feel it warrants. This assumes your improvement does not interfere with the landowner's use. You can come and go whenever you want, but you can’t park in it in case the actual owner needs to use it. He has the right to use it too; after all, it’s his land. He just can’t keep you from also using it.
I went to the County records and checked and, yes, it is clearly established in all the deeds, the owner’s and his neighbor’s. Most often a ROW that you have will not show in your own deed, only in your neighbor’s. So when I am asked to research ROW’s that’s where I first look, in the adjoining landowner’s deeds. Why is it this way? Because the ROW affects what the neighbor can do or not do with his land. It does not affect your land as it is not your land the ROW is on. But it sure makes a difference to you, having it. In this particular case, the neighbors have different attitudes about it. The husband readily acknowledges the existence of the ROW and said the buyer could do with it as he wished, only don’t trespass even an inch. OK, fair enough. He’s got that right. The wife takes a different approach: use it and we’ll find a lawyer. I cannot see how she could win, but if she sued, the new owner would have to pay to defend himself. And of course all this concerns him a great deal. And I can see it using marital strife next door. We’ll see how that plays out. Hopefully cooler heads will prevail.
I said it was clearly established. By this, I mean it’s existence. The wording on its location is on the vague side. Yes, it clearly shows on the survey map, but no surveyed coordinates or distances are shown. The map refers to a barbed wire fence, one which we can’t locate. Maybe with the snow gone, it will reappear. Wouldn’t that be nice? Or maybe someone removed it. The survey is not so old that it is likely to have rusted and rotted away. There is another potential solution. Approach the neighbor, ask him where he thinks it goes, maybe offer to move it somewhat if he prefers that. He should appreciate the courtesy of that offer. The two owners can do anything they both agree to. If they both want to move the ROW, they can.Then formalize it legally.
There are also a surprising number of ROWs that are not in any official papers. There may have been a legally-binding document drawn up that was never filed. Or, the right to use another’s land may have been handled informally between two friendly neighbor for many years. When a property is being sold or transferred, a sharp lawyer will make sure this gets formalized to avoid future difficulty. After all, the next neighbor might not be so friendly. There are times, analogous to Adverse Possession, whereby a landowner can get an “Easement by Prescription”. In such a case, one party may have historically been using a certain way in. It does not have to be only for access; other possibilities I have seen include getting water from a well on another’s land, gathering firewood, and even hunting there. Do it long enough and eventually someone acquires a legal right to do what he has been doing right along, especially if the actual landowner does not exert his legal rights or does nothing to stop him during this period.
There is place for sale right now with a nice driveway, except no one can park on it. It is also a ROW for another party, who lives further back in. But he has his own separate drive and his own road frontage, but for some reason he also has a ROW up the driveway. And he uses both ways in, probably to assert his rights. And he’s nice about it. He even keeps it cleared of snow and nicely graveled. So they drive in, park on the lawn, and everyone stays happy.
There is also something called an “Easement by Necessity”. A landlocked parcel to which there was no ROW would be a good example. Some years back, the State came out with a ruling or law that allowed owners of land-locked property to force access where none existed before. At the time this passed, I asked several attorneys how it worked - and not a one of them knew. But I could tell the attorneys sure wished they wouldn’t ever have to deal with such a case. Since in the 30 years since a situation like this has not come up with me, so I still don’t know. In the case with the 118 acres that was first mentioned, this would not be appropriate to employ because the owner has complete legal access from anywhere along the paved road. The word “access”is defined broadly and does not mean “vehicle access”. This would be ridiculous for people who own islands.
We once had a man ask us to list his woodland. This was located in the back of his property; fields were in front of it. He wanted to keep those. I pointed out that unless one of his neighbors wanted to buy it, a new owner would not have the legal right to visit what he bought. Without an easement or ROW, the land was worthless and that’s exactly how someone else would value it. He considered this and came back to us later on with a legal ROW that he had an attorney draw up. It followed the boundary, which was a good idea as it was now clearly defined. But it was only 15’ wide and there were several right angle turns along the property lines. Hey, a car cannot turn a right angle in 15’. But he didn’t want to give any more width. Then I noticed that one boundary crossed a small lake. So even if you got your car to that point, unless it was amphibious, it still couldn’t reach the woodlot. We declined the listing. That’s not salable, except to someone whose land adjoins.
Easements and ROWs may have expiration dates, though usually they don’t expire. When they don’t, they are called Appurtenant, they run with the land. To get rid of one of these, there are two things you can do. One is to simply buy the property from whoever who has the ROW through your land. If the owner can be persuaded to sell, that is. Owning both, you can now get it off the deeds. Or you could pay the owner enough to make it worth his while to relinquish the ROW. Note that there are counties where this last suggestion won’t work as they no longer allow new parcels to be landlocked, to exist without access. But there are instances where a party enjoys more than one ROW; then it could work.
I once had the opportunity to buy 80 acres at a bargain price. Nice land too. Checking out the maps, I noticed it completely surrounded another parcel of land. Visual inspection of the smaller parcel showed that someone was actively doing something there with bulldozers and rocks. Later I heard a fellow had bought it and planned to build a very nice home there. He already had in a quite nice drive I did more checking on legal documents and could not find any mention of a ROW. How did he think he could get there? Then we found two buyers, one for each side of the drive. So I wrote to this fellow, offering him a ROW if he’d survey the drive so I could use it for a legal description for my buyers. After 2 or 3 weeks, he called me and said it had been surveyed already but he didn’t need any ROW from me. “Are you sure?”, I asked. “Once it’s sold, I can’t get you in.” He was sure. So I shrugged my shoulders. If he wanted it that way and was happy, then so was I.
A few days before the closing, he called me again. “Ahm, about that right of way… can I still get it?” Well, now all the papers were drawn up and I’d have to pay to get them changed. I replied, “Yes - if he paid for the changes and got them done immediately.” He was only too glad to pay. Later on, I learned that when he bought his land, his lawyer was supposed to take care of the ROW, but had neglected to do it and now it was way too late. We owned it, not the old owner. Were we that kind of people we could have sold it to him for an outrageous sum. He was over a barrel and had no choice. We had him by the short hairs. But we weren’t that kind of people; I want folks to speak well of me and say they’d always been treated fairly. If I hadn’t brought this to his attention, he would have never known he didn’t have the ROW he thought he had. And then the new owners would have him by the short hairs and he’d either have a very expensive home or they would have had extremely cheap land to add if they wished.
There are folks who do not now what this means. And a lot more do not know all that it implies. A parcel of land which is landlocked does not have any road frontage or, sometimes, any frontage on a waterway big enough for boats. This means you cannot see foot on your land without trespassing or without permission of the adjoining landowner of land that you must go through to reach your own.
Or…. Or you may have a Right of Way or an Easement so you are not trespassing or going in and out (“ingress" and “egress” is how they say it). These are legal documents or are part of legal documents that state your rights to use someone else’s land. These can also exist on land which has road frontage. The owner of that land cannot stop you from using his land, provided that you are using it as proscribed in the documents.
There are many ways this is done and many forms a ROW or easement can take. You may be able to use it to get yourself in and out, but not other. Or, for example, using it for getting felled timber out may not be permitted. Or you may be able to use it to get machinery to and from a field for crops but not use it to get in to hunt. Or you cannot use it between midnight and 6 AM. Whatever. But most often, use is not restricted like this. I mention these examples to demonstrate what can happen.
Years ago, people were pretty off-hand about these things. They knew each other. “Sure Tom, you can go in and out. Any time you like”. “Well, let’s go in this way this time. Earl won’t mind.” Maybe good ole Earl won’t mind but his heirs might. Or the person he sold his place to might. If it’s been written down somewhere and signed, you have more legal legs to stand on. Some of these documents were never filed with the County and as such are not part of the record. But they may be legal. If you can find them. If it was filed, it still may not be in your deed. Why not? The ROW is a restriction upon your neighbors deed, not yours, so it needs to be there for anyone contemplating an interest in his property in the future. A good lawyer back when would also have it placed in your deed as well. But it needs to be somewhere retrievable if it is to be legal.
Now, suppose there is no easement, no Right of Way? What do you do now?
You approach your neighbor and, very politely, ask him for a Right of Way. If he does not agree, offer him money, enough to change his mind. If he is still intransigent, approach another neighbor if you can. Then do the same thing. Remember honey catches more flies than vinegar.
If that doesn’t work, you can offer to buy his property, or perhaps just buy what you need. Or, sell him yours and be done with it. Remember, he hold all the cards. He knows your property isn’t worth much if he doesn’t play ball.
I once owned 80 acres that we split in two pieces to all to two parties. The dividing line was a driveway to a third property which was otherwise completely encircled by our land. When I researched the deeds, I discovered the tax maps were right. That property was landlocked. A survey had shown a road to get into it going through out land, but there was no easement or ROW. The owner hadn’t owned it long, so I had our lawyer check to see if I’d made a mistake in my interpretation. No, I was right. So I wrote to this person saying we owned the land completely surrounding him and we were about to sell it. In the interests of being a good neighbor, did he want us to give him a ROW down the survey line?
His answer surprised me. “No”, he said. “I’m fine the way I am”. I repeated my offer and got the same answer. OK. Maybe he has a helicopter. If he’s happy, I am. We went back to preparing documents for the closing. Just before the day arrived, I got a call from this fellow. He was eating humble pie. Thinking over what he’d said to me, he called his lawyer and, sure enough, the lawyer had screwed up and forgot to file the planned Right of Way. It was way too late to do so now. He was going to need that helicopter. The way I solved his dilemma was to ask my buyers if they were OK with allowing him to have the ROW he thought he had. The agreed (good neighbors!) and I asked him if he would take care of the extra legal expenses that we now had to incur., He was delighted to do that and probably had been sweating that we’d ask for many thousands of dollars to allow him to use his own land. He’d already started excavation for his new home.
If you don’t get a someone like on the other end, what do you do, other than give up? You get a good lawyer - not a mediocre run-of-the-mill variety. Years ago, I was told by several people the New York State now allowed landlocked property owner to force a Right of Way if they could not get one any other way. Wanting to know as I figured at some point this would be something I needed to deal with, I asked, over time, three real estate lawyer how it was done. None knew and all were skeptical. Not a good start.
It seems there are two ways this can be done and not all will work in all circumstances. You can get a ROW by Prescription. Analagous to Adverse Possession, this works if you have used the neighbor’s property to get to yours in a ”hostile, open and notorious way” for a number of years. By “hostile” we mean you made him no payments and did not have permission; you don’t have to be feuding with him. The other way is by Necessity. Here, you need to establish that the land would not be useable without it and that one had to be implied when it was firs landlocked. You’d have to prove it never had frontage or was once part of a larger tract which did. If a previous owner had neglected to grab or record the easement of ROW, you would need a court order to enforce it. It’s easier if the owner of the land you need to go through was once the owner of the land you want to buy or own now. This is the kind of stuff you bring in lawyers for.
Getting access does not necessarily mean you can drive in. Access by walking or by boat may be considered legally sufficient. I had a client who for some reason sell off his woodland. It was hard to get to as a large beaver pond separated his open land from his woodlot, He’d made sort of a earth bridge to accomplish his logging. . So - bright idea - he said he’d give the new owner a legal Right of Way In. What did he come up with? It was 15’ wide, following the northern boundary of his land as it twisted and turned. This was not the way he used himself.. There were two right angle bends along the boundary. Think about this. How can you make a right angle turn in a vehicle in only 15’? Worse yet, you’d need a amphibious vehicle to get across the pond. It was several feet deep at that point. We declined the listing.
We saw and ad for a large woodlot in the Southern Adirondacks. $100/acre at a time when go land was around $1000/acre, How could you go wrong? As I guessed, the land has just been heavily logged. It would be 20 years or more before another cutting could be taken. But it was not a bad piece of land, not at all swampy as I’d feared. But it was landlocked. There was an obvious road in and we were told by the agent who owned it and where they lived. We knocked on the door. It turned out to be a woman who my wife, a nurse, had helped during the death of her husband. Of course she’d let us walk in. She didn’t recommend driving with our 2 wheel drive low clearance vehicle. We don’t mind a walk and took one, knowing we wouldn’t buy it no matte what we found. The lady said she’d let us go in and anybody else she lied, But she wouldn’t sign any documents giving anyone a the right to drive in. It was important for her to retain that control. Well, that’s fine until one of us dies or sells. Then all bets are off. No thank you. This is the stuff that long drawn-out and costly lawsuits are made of and we didn’t want any land bad enough to step into that mud puddle.
I routinely attend county auctions of tax-foreclosed land whenever I can find the time. Landlocked parcels are popular in these sales. No surprise: a naive buyer gets this wonderful parcel at a bargain-price only to find out it he can’t get in. After a few years, he gets tired of paying taxes as if he could use it, so he stops paying. The county take possession ion it in due time and it goes to auction, only to have th process repeated. In Schoharie County, they have a policy of not allowing landlocked land sold unless there is an easement or ROW - or the successful bidder owns adjoining land. They then require the parcels be combined so the County doesn’t get into this again in the future. Smart of them. And it’s slowly eliminating such parcels.
Now, suppose you get yourself a ROW, there are other questions that need to be addressed. Who pays for maintenance? The old owner won’t want to pay for you to get to your land, but he might want you to pay him if for part of the way in you use his driveway. In general, if you want it nice, you now have the right to spend as much as you want on the ROW, provided you do no harm to the owner through whose land you are traveling. In other words don’t put a road across a wet area without putting in culverts to avoid flooding his land. If you rut up his own driveways, then be prepared to promptly repair them. Twice I have owned land on a private road. I had the legal right to use the road, no problem. On one, a person who owned land past mine demanded I pay a share of the maintenance to his land. On the other someone repaired the road, plowed the snow and took care of its I never found out who, nor in the 15 years I was the owner was I ever asked to contribute. And in neither case did I ever find documentation of my obligations, or even if there were any. Someone screwed up; it should have been addressed when the development was first done.
You could be in the position of not needing a ROW, then finding out you do. For example if your land was accessed by a little-used town road, and the Town later abandoned the road. What do you do? Or suppose your access was taken by Eminent Domain (the government has the right to take personal property when it is perceived important to the general public)? Or maybe a stream changed course. When that does, ownership changes can happen if the stream was considered the boundary. The answer to this, if there is one, is spelled “G-O-O-D L-A-W-Y-E-R”. And don’t ask me.
My training and expertise does not qualify me to judge timber yields or value, which goes up and down seasonally as markets rise and fall and as demand for certain species changes, so potential timber value, if any, is not something I can expertly advise people on. That disclosure over with, I’ll go on…
Do not ignore timber value. Years ago, one of my clients had a 350 acre woodlot and he took out two species, ash and cherry, and only those above 18” diameter at “breast height”. That’s a pretty big tree. Do you know what he received? $350000. That’s right, $1000/acre, which is more than he could have sold it for at that time, land and trees together. And his land was worth nearly as much after the harvest than it was before. Why? Buyers usually do not pay much attention to such things and since the woodlot was left looking nice, a typical buyer would be happy with it. There were still plenty of big trees left to admire, since only the two species had been taken.
On the opposite side of things there was a 100 acre woodlot outside St. Johnsville we had for sale - -until the owner decided to log it. He got a very different kind of logger. Loggers and foresters are not the same thing, keep that in mind. When the logger was done, it looked like God had been through it with a weed whacker. There were 30” deep skidded ruts all over. Slash was everywhere, hip deep in places. Once perfectly healthy trees, the few that were not taken, were scarred and bent by the skidders, disfigured and damaged beyond what time could restore. The place was a nightmare. And it would take 50 years before it began looking normal. Brush and briers were beginning to spring up. Since nearly every tree was taken, there was now enough light coming in to allow them to sprout.
You see, loggers are the professionals with the absolutely worst reputation, worse even than politicians, worse even than preachers and real estate agents. And for good reason. They have been known to ”not notice’ when, chainsaws in hand, they crossed over the line into a neighbor’s forest. They may have agreed to give you half of what they took, apparently honestly putting felled trees into two piles of equal size. Only one has the more valuable trees and your pile holds the culls. Or they may have just said that there was not nearly as much timber there as you thought, so your return was disappointing. Was this guy being honest? Or was he selling more and telling you about only part of it? Were you there, watching every load that went out? Don’t get me wrong, there are scrupulously honest ones too. But how do you know which is before you, talking slickly? If you don’t employ a forester to work for you at least ask for references and talk to the references at length. Find out how he left the property when he left? Was the slash all removed? Burned? Left in neat piles? Or left just wherever it fell? Were the skidder ruts filled in? How do they know they got a fair return?
If it is felt that real timber value exists on a place, my suggestion is to employ a professional forester to do an evaluation. In many cases, timber value has surprisingly little effect upon the price any given property may sell for. If you have owned a place for years and have not done any logging, it may be well worth the expense of having the timber resources professionally evaluated. A professional forester can evaluate not only the value of standing timber but also the health of the stands and make recommendations for improvements. If employed to find a harvester for timber, he will put it out for bids - but only among those firms he knows are reliable, honest, and will leave the forest clean afterward. And he will monitor the harvest to make sure only those trees he designates will be taken. He knows what value is there and will make sure you get your fair share. And he’ll make sure you are not left with a mess and a severely devalued property.
Let’s take the above paragraph apart some. If you have owned it for years and have never logged it, that does not guarantee you will have real value. If it was in woods when you bought it, then very likely. If it was brush, then maybe not. I went through a woodlot that was full of white pine, probably our more desirable species of softwood lumber. Trees were big around at the base, but then usually split into several vertical branches a few feet up from the ground. Those were not nearly so large. What happened? Daughter #2, the internet guru, did some research and determined this was due to a disease. I have since seen it in several stands, now that ai have learned to look for it. A forester might tell you to take them all down, chip them, and plant another species - then wait 25 years. Or he might know a pellet or plywood company that can use such timber.
I once hired a forester to separately appraise a property that I was appraising, then moved him to a woodlot I owned that I felt had potential for timber. Boy, did I learn a lot that day! The first thing I learned was that I didn’t know nearly enough. He’d look at one tree, one I felt was of dubious worth, and say, “That is worth $300”, then point out another that looked the same to me and say it wasn’t worth anything due to some disease. Then he’d show me how to recognize the symptoms. He’s show me one there that worth hundreds 2 months ago, but with the changing market for that species, he’d now advise me to let it grow. In general, it’s the hardwood species which ebb and flow in demand and price. He also suggested that I just cut down certain trees and let them rot, the idea being that they were just competition (for sunlight, for minerals, for space) for more desirable trees. Since that involved work and time and since I wanted to sell the place, I did not do these things. I hired him to help me decide how much I could get for the woodlot when sold. And I passed along his recommendations to the new owner once I found one.
Once I made a sealed bid on a property I wanted to buy. There was a field, an old home, some other buildings and lots of woodland. Bob, a friend was the successful bidder. Later on, he placed the woodland for sale with me. I had not even gone in it before, being chiefly interested in the buildings and open land. Gosh, the place was like a park! Big trees, no undergrowth, grass between the trees, a peaceful and beautiful space. Then he told me, “You know, I took out enough timber here to cover my entire bid.” Boy, had I screwed up by failing to recognize what value there was in that woodlot! His logger had done an exceptional job of leaving things neat and clean. I looked about and, yes by gosh , there were recently cut stumps. But they did not jump out at me like they would in a property left in a lesser condition. The now-harvested woodlot sold readily, too.
Buyers see a recent cutting with white-faced stumps all about and slash lying in your way everywhere and their minds begin to yell, “Rape”. So if you are going to take a cutting, plan to do so some years before you want to sell it. Then take the time to let the slash rot to nothing (or sell it for firewood) and let the stumps get covered with moss. Get the ruts filled in if the logger did not do that for you. Or be really smart like Bob was. He makes his living doing things such as this.
A decade or two ago, I spoke frequently with a family who wanted land. They were folks who had obviously never had much money, but were poised to come into quite a bit as their rent-controlled apartment was going to be razed and they were the sole holdouts. They’d been holding out for years and were the only ones left in the entire building. “A long shot”, I thought, but it turned out they ended up relatively wealthy, at least relative to where they’d started from. Mostly, my relationship was frequent phone calls and emails, very friendly ones I must say. Then they finally scheduled a visit, one which proved a disaster for me, as they arrived 30 hours late, driving up from New York City (3 hours away). It became obvious from that one showing that they had no clue about what good land is, or even on what they wanted. We drove around a neglected field and one of them got all excited over seeing a seedling pine tree (they were all over). They asked if they could have it and, upon receiving an affirmative answer, pulled it up, leaving some of the roots in the ground. Then they sat it in the back of the car where it could get full sunshine and dry out good and thoroughly on the 30 (?) hour trip back. They wanted to plant it in a window box. “That pine is doomed”, I thought, just like the day had been for me.
They never did buy from me or anyone else in the firm, though they looked with the others as well. No loyalty, despite years of friendly exchanges. Some years later, I got a message from the son, Roberto, who had always been my contact. They’d bought not one but two pieces of land and one was only a mile away from me! Not only was there a lack of loyalty, but it was a kick in the pants. My solace was that both pieces were kind of crappy land, though one held some potential. If things did not turn out well, we could not be blamed.
At long intervals, I would get a friendly note or a call from Roberto, often telling me about events in his family’s life. And he liked to hear about my family as well, though he’d never met any of them. Some folks are like that and I am alway glad to keep up the relationship. Most just want to use me and then forget me when they have no more need for my services, so it is refreshing when one wants to keep the relationship going. Some years passed and the exchanges started again. Now, he wanted to sell one of his pieces of land. We talked, and the price he quoted that he wanted was several times what the market would bear. I told him so, but Roberto insisted that was what he wanted. I wished him good luck.
Three more years passed before the next contact. He wanted to sell them both now, and of course for the same ridiculous price. He’d been half-heartedly advertising them, but had gotten nowhere, which was hardly surprising. Buyers are not fools. This began a very long email exchange. When I give long explanations, I like to make them in writing so the recipient can go back over and ponder what I have said. Through the course of the correspondence, I gave many, many long explanations on what market conditions were, why he could not expect to get anywhere near what he’d hoped for. Now, in response to my arguments, he was willing to come down - but to a figure only 3 times what each was worth. That was an improvement, I suppose, not that it would make much difference.
I was pretty frank and said, in as every way I could think of, that people would not pay anywhere near what he wanted. If he had to get that, then he had better expect to wait some years for the market to approach those figures. How long? I didn’t know, who does? A decade maybe? Perhaps longer. I even told him the best reason for me to even take the listing was to make other property look better.
Roberto’s response: well, they’d owned it all these years and paid taxes all that time, didn’t they have a right to get back their investment? ….Well, no. No one ever has a “right” to make money or even to keep from losing it. This is the United States and we embrace capitalism. No guarantees. As an aside, adding the years of taxes to their purchase price (which was not cheap, they definitely did not get any bargains when they bought, which was also at the height of a price spike), and they would still be asking for a 2-300% profit. It didn’t sink in, none of it. I was convincing only myself.
I told him that buyers don’t care what his investment is or if he made or lost money; they only care if what they buy is worth it to them. And they are definitely going to check prices on similar properties before they buy, especially in these days when all you need to do that is an internet connection. I mentioned that once in a great while a buyer, thinking he was astute, will look up what someone paid for the land they are selling. It’s public information and available to anyone who knows how to look for it. And these “astute” buyers may then complain if someone is making too much money. My response to them is that they should always focus on what anything is worth to them, not what someone else paid for it. Immediately after saying that, I follow through with this: “If the seller was losing money on it, would you up your price?” Naturally, none of them would ever do that and they then realize the foolishness of their line of reason. Or they should. Some won’t.
This sort of reasoning does not work on Roberto. I told him that every property on the market is in competition with each other and the cheapest ones sell first, nearly every time. So, if you are over-priced, the best you can hope is that the competition gets sold off and then your turn comes. But that only works if nothing new comes on the market, so it’s not of much use. He replies like a stuck record, that he deserves a return on his investment (>200%?). He has a teflon mind: my explanations and reasoning just refuse to stick.
I explain to hm why his land is not that good. One piece is flat and wet and a huge high line cuts it into. the other has a very shallow soil, especially at one end. Heck, at that end, there is no soil, zero. He says that is why he likes them - they are flat. The land was run-down decade ago when he bought it and one piece has not even been farmed since. The bushes are only more prevalent and higher now. Then he tells me of the great barn that there is on that piece. I explain that this barn is nearly 50 years old now and the town values it at only $2000. Which gives me an idea - look up assessed valuations, which I do. And lo and behold, it turns out that the Town figures (at fair market value, current prices) they are worth even less than the figures I have quoted him, which in turn are a fraction of what he wants. I let Roberto put that in his pipe and smoke it for a while.
He called back, making the same arguments. But now he is willing to capitulate some; won’t someone just make him an offer? I reply that other than professionals and certain ethnic groups, people just don’t do that. If the asking price is not close to what they want to pay, they will not bother to make an offer. (True, very true.) I finally agreed to take someone by one of them in the next couple of days, which I did. The buyer, who was ethnic, told me to not even stop but did ask a single question: why was the seller asking so much money?
A few days later, Roberto asked me what the buyer thought about the land. I told him, talking to deaf ears. Hey, Roberto, wanting something does not make it so. The market does not care what you want. Nor do buyers. So he finally agreed to ask a bit less, only 2 1/4 times its worth on a good day. The current dialog has been going on almost daily for a month now. Last night, I was up to midnight preparing listings to get signed. Let’s see if he signs them. I ‘ll bet that he will want to add my commission on top of the price he wants.
Roberto is a motivated seller too. They are in danger of losing their home to the bank. Their taxes are behind and the County could be taking any of their three properties and that has got their bank worried about their investment in the home (which is not for sale, not now). But I am not worried about them losing their home as they have lots of experience staving off institutions. They know all the tricks.
What Affects Land Values?
What gives land (not buildings) its value to people? Here’s what is most commonly valued, based upon the order I think of things. You may order them differently - and should.
WHAT ADDS VALUE ?
1) A mixture of open and wooded land
3) Water (steams, rivers, farm ponds, lakes – generally, the bigger, the better)
4) Green open fields, or fields growing impressive crops
5) Privacy and quiet (which are not the same thing)
6) An area where folks want to live
a) Condition of nearby properties
b) Low taxes, good schools, distance from jobs
c) Proximity to amenities
d) Who the neighbors are (relatives, friends, values, and mores….)
7) Timber value (many fail to consider this – a few do; everyone should)
8) Variety in the topography and landscape
9) Quality of soils, levels of fertility
10) Organic certification (some could care less – I look at this as a selling point more than something that adds dollar value, meaning it attracts, but only a few would pay extra for it)
11) Recreation potential (off road vehicles users and hunters regularly buy land, cyclists and fishermen don’t)
12) Easy to visualize boundaries
13) Sunset potential, along with a general feeling of brightness
WHAT HURTS LAND VALUE ?
1) Woods that have been recently heavily cut, especially those showing big ruts with slash lying around (buyers think “rape”)
2) Neighbors that are too close (most of my buyers come to escape urban and suburban landscapes)
3) Large power lines and, to a much lesser degree, pipelines (this aversion was much worse many years ago, but it still persists)
4) Lack of access to electric power and, to a lesser degree, internet, natural gas, cell phone service…)
5) High taxes (high taxes hurt far more than low taxes help)
6) Wetlands and, less often, steep land
7) Lack of eye appeal (duh)
8) Inability to see most of the property from a single vantage point (truly hidden places are fine to advertise but are harder to sell)
9) Rights someone else has over your land (mineral rights, Right of Ways, water or hunting rights, deed restrictions, tenancies…)
10) Lack of easy vehicular access – nobody wants to build up driveways over wet land, to erect bridges, or to bulldoze away knolls that are too steep
11) Famously poor or disliked schools
12) Brush – it says you do not care enough about your land to keep it clean or maybe it wasn’t worth improving – and it also tells folks that if they want it to look clean, it’s going to cost them in both effort and money.
13) Being surrounded by nearby higher land (they call it “being in a hole”)
14) Weird shapes to the land boundaries (believe it or not, some folks have a thing for straight lines and rectangles)
Naturally enough, each of these does not affect every buyer the same. Each sets their own values, none embrace or reject all those which I have described above. So, I speak in generalities. Take neighbors that are too close for example: I have actually lost a couple of sales because the wife or someone wanted nearby neighbors and didn’t feel they had enough of them at a particular place. But for every one of these which I lost, there were 50 who rejected a property because the neighbors were too close. One man’s meat, another man’s poison.
9/6/21 A Race Like No Other
Sam was getting older and the hunting properties he’d cherished were turning into a burden, so it was time to liquidate some of them. One in particular was a problem; neither of us knew how to price it. He’d ask me to get it sold, I’d ask him how much he wanted. And so it went for a couple of years. Finally this spring he made it clear he wanted it gone. So once again I wracked my mind to figure out the highest price that would be obtainable.
I do appraisals. Why was this so hard? Well, you see this was no typical property. 30 acres of woodland, but that’s where comparable stopped. Nearly every inch was steep. Power was 1/4 mile away, and the Right of Way in, while a once-paved abandoned Town road, was quite steep, not in good repair, and the final culvert was washed out, leaving a steep 6’ deep gully, 20’ wide. From top to bottom was a 300’ vertical rise. Though structurally sound, the cabin who been heavily vandalized and never had water, septic or public power. It hurt me to witness the increasing vandalism over the years as I like to think our area is free from such acts. It almost is.
But then there were attributes that added to the value, namely a series of waterfalls and swimming holes. Some of the falls were along 2 small side streams, but the one that got serious attention was in a creek which formed the western boundary. The main falls was over 100’ high and had a large plunge pool at the bottom. And was far prettier than your average 100’ falls. Because the water before the falls flowed some distance over flat rock, its water was unusually warm. During storms, it might be 3’ deep, falling 50’ wide. In drier times, a peaceful sight. In the winter, one can climb behind the falls and look through crystalline ice to the outside. Below the falls were a series of smaller falls and more swimming holes. Isolated yet so close to town, it enjoyed excellent cell reception. It looked like a State park in the raw; in fact the Town once considered taking it for a park. There is nothing like it that had ever come for sale.
So, knowing we had to start somewhere, I priced it at roughly $3000 an acre, reasoning that once in a while some land brings that much here. We could always come down if necessary. It turns out what I’d established was not the asking price, it was the starting price. This hit the market just as COVID-inspired sales began to skyrocket and prices all over the US began their steep rise. On my first ads, we had no clue of what was about to happen.
But we figured it out pretty quickly. The phone rang off the wall. Me and my salesman Pete could not keep up with the showings. I had to create a database to keep track of the offers. One day, I showed it to 10 parties, walking 6 miles and climbing over 3000 vertical feet in the process. The entrance along the road began to look like a parking lot. We did this for 2 weeks to give enough folks a chance to see it and to make their offers, then we would accept the one Sam liked best. That happened to be one of the very first parties to visit; they’d offered, cash, well over 50% higher than the starting price. Short and sweet, huh?
Well, it proved to be neither. It seems the buyers wanted a survey. No problem: we had not one but two of them. I need to interrupt and do some explaining. Back in the mid-80s, when Sam bought it, Edwin, the owner, said he had a survey, but at the closing had to admit he couldn’t find it.. No problem, Sam ordered a new survey.
That’s where the problems began. When the new one was completed, we learned there were 20 acres, not 30, and the missing land was the part that connected with the right of way and contained the foundation upon which Sam wanted to build a cabin. You have to understand, this was a very cheap sale. Lawyers don’t like to waste too much time on cheap sales where not much money is at stake for either party. And since neither Edwin or Sam were hurting for money, so they diid not push too hard for a resolution.
Finally, Edwin found his survey. It looked radically different from the new survey. His surveyor had died a number of years prior., so we couldn’t go to him for any answers. Things went along, with tensions between Sam and Edwin tightening slowly but surely. Edwin did not like to have his word doubted, but could not prove that he was right. The new survey was unassailable.
Finally I tried to intervene. Going through the old deeds, I went back over the years, deed after deed, until 1920, when one of them appeared to be more accurate than the ones that had followed it. I copied down the description and tried to draw a map. I couldn’t, so took the figures to a engineer who ran them off on a computer program. It didn't close (meaning the starting and ending points were not the same, there was an error somewhere), but it came close enough to still encourage me. Playing with my copy machine, I changed the scale of this line drawing until it matched the 400 feet to the inch scale of my aerial photos. Then, I made a overlay on clear plastic and took it to Edwin’s lawyer. We taped the aerial to the window and then the over lay on top of it. Instantly the lawyer recognized what the problem was. He knew how to settle it.
It seems when Edwin had sold his farm a few years ago, the buyers had ended up with more than the farm. Mistakenly, they also got the missing part of the waterfall property. To be fair to the new owners, they never knew this, and had never considered that they “owned” this land. But now that they knew it was legally theirs, they didn’t want to let it go. This riled Edwin, as you might expect. For years, he had let them use his bulldozer whenever they wanted. He let them take hay, for free, from a field that he continued to own. Edwin held the mortgage on the farm and each year, he gave them back their last payment, saying they might as well have it as the IRS. And if they didn’t play ball and give it back, all this was going to end. Since it was steep, wooded land, land they had no use for and never thought they owned, they saw the logic in Edwin’s threats and gave in and the dilemma between Edwin and Sam was settled.
Back to the present. It seems the original survey had been housed with Edwin’s lawyer’s records. But a few years ago, the creek in town had flooded, wiping out many decades of records the firm had stored in their basement. The tax maps and deed descriptions were correct, but we could not prove it with surveys. A desperate search was made for another copy of the the original survey. We found a surveyor in another county who had in a roundabout way ended up with the original surveyors records, a pile 2’ or so thick. He did not find what we wanted and was too busy to make a concerted search.
What all this meant was the the new buyers had originally asked for a new survey but Sam said, “I gave them everything I had. The title is clear and the description accurate. If they want a third survey, let them do it.” But they wouldn’t. And this led to a 6 month-long stalemate, during which each party began to plead with me to get the other moving forward. I tied, but good nowhere.
Meanwhile, behind the scenes, buyers continued to call - despite me clearly marking it “UNDER CONTRACT”. They either hoped it would fall through or did not know what those words meant. Regardless, they kept calling. At times it was my most active property, if measured by inquiries received. My database grew to nearly 250 separate parties, some of which who had made backup offers, more than doubling the starting price. As time wore on, the pace of the inquiries increased. Some were savvy enough to realize that if it had gone this long without closing, there was a problems and they hoped to take advantage of this. Others were clutching at straws because there were so few other properties left on the market. And none of those had waterfalls. With each inquiry I carefully answered their questions and explained that it might or might not every reach the open market where they could seriously consider it. But I would let them know if it did.
By this time, my inventory was 20% of what was normal. I half-joked with people: “Yes, I am making a ton of money this year, but may find myself out of business next year.” A bit funny but way too likely. It is a seller’s market, something we have not witnessed in the 40 years I have been in real estate;
So finally Sam’s lawyer gave the other side a “time of the essence” letter, meaning “either close right now or withdraw”. This letter closely followed an offer from one of my new callers to buy them out (he offered them a very large incentive to withdraw in his favor - but they did not even consider this). That was evidence they really wanted the place and after a couple of days, Sam’s lawyer called to tell me a closing was scheduled.
Then he called to tell me of a new wrinkle. It seems Sam had formed an LLC for his various properties in New York and New England, a plan designed to make it easy on his heirs. We knew this but had just found out that Sam’s downstate attorney, who had done all that work, had never filed the deed in the LLC’s name. It was still in the old name as far as the State and County knew, which is what all the title documents and searches were based upon. Now, they had to repeat the process under the new LLC name. Since it was recent, the process would not be so time-consuming as it was before, but they were not ready to close as they’d supposed when they had drawn the line in the sand with the time of the essence letter.
So, when will it close? Hopefully, later this week. But we’ve heard that before. And then I have to inform 250 people to look elsewhere for their waterfall.
This is something I have learned the hard way: keep your practice local. Well, relatively local. Every so often I run across a property that is definitely not local. Maybe the owner has met me , likes the way I do things, and begs me to take the listing on their property even though it isn’t nearby. Maybe it’s a friend who lives out of the area. Maybe the price is so low I think I won’t have to make too many long drives to get it sold. Though I should not admit it, I can be easily swayed by opportunity. I learn the lesson again and again.
My first year at this, I listed 2 properties located 3 hours to the Northeast and another which was 4 hours to the northwest. I remember the trip well as when I got to Saratoga, my exhaust manifold broke and I sounded like a race car driver for the next two days, amazed no police hauled me in and impounded the car. Hardly anyone called on the places and I only showed the two once. At least I did not tie them up in an exclusive contract, so no owners got made at me for such poor performance.
Also early in my career, we took on a salesman from the central and lower Hudson Valley. He went right out and got several good listings. Well, they were good for everything but price. Compared to property in this area, they were double in price. Compared to properties around them, those prices weren't bad, so it seemed to Mort, my broker, that we ought to be able to nip off a few of these. They were obviously nice farms. Only no one called. And this went on for a very long time. I drew the conclusions, probably perfectly correct at the time, but less so today, that most of our buyers then didn’t care where they lived. They cared about the land, the buildings and the price. And the price on these places scared them off. In the very few opportunities I had to speak with folks who called on them, I’d explain they were in a very different area, where prices were far higher. But the milk price there was only slightly higher than ours and they could not see it working, not when they could get a similar place here for half the amount. Those farms just did not look good in comparison with the others we offered. Folks here were underselling them.
Finally, I got a call on one. The fellow wanted a particular place and I quickly returned his call Was this my opportunity for a big commission? Talking to the buyer, I got brought back to earth quick enough. He sounded young and naive. Then I found out he had almost no money. “Then, why did you select such an expensive farm?” I asked, genuinely perplexed. “Oh, I thought I’d might as well start at the top”, he said. This was taking naivete to a new level.
He had not given a thought on how he could pay for the farm. It was the most expensive we offered then and he’d assumed it was the best, for that reason alone. He’d never thought how it could be financed. No bank is going to loan 100% and they are not going to loan to someone who is wringing wet behind the ears.
I had a friend from Hawaii list his place with us informally. We’d made arrangements for a local broker to do the showing and to keep us legal as we were not licensed in Hawaii. I had no idea how that was going to work out, but we did get calls. No showings of course. But it sold right away. Then one of my customers asked me if we could help them sell their place in northern Maine. If it would sell, they could buy down here. I explained that this was way too far for us to show and we made arrangements that we would get a straight advertising fee upon sale, not a commission. I asked lots of questions of them and received lots of photos so I could field calls intelligently. We had a few calls and one showing, which went poorly. Then by mutual consent we gave it up.
Years later, I got a listing call from the Castletons, who had very large farm near the Canadian border. I talked with them for a good while and decided I’d take it on. It was interesting and I wanted to see if I could pull it off. I went up there, visited everything, took copious notes and tons of photos. Then they gave me a price. This was a truly beautiful place, impeccably kept, and very large, but they were overpriced by a factor of 2. My mistake was not establishing the price before I went up; by coming there I’d kind of committed myself to the effort. Try as I might, I could not make them believe that just because their name was Castleton (they were respected locally, as they deserved), it did not make the farm worth more to anyone else. Sighing to myself, I figured this one would be for the long haul as they were people who had to learn by experience, not from advice I could give them. Since it was so big, we got a pleasant number of calls and many of them resulted in showings, eight hours of driving each time I made the trek. It took another 4 hours to show the property. But the buyers were not dumb and they kept their hands in the pockets with their checkbooks carefully hidden. The Casteltons eventually lowered the price - over a year later - but not by much, Then, with more time, they lowered it again. Then the bank foreclosed and a neighbor bought it for cents onto dollar. A firesale price. Their pride cost them dearly; I could have saved some of their equity had they been willing to listen to reason.
At the same time, I listed 2 smaller farms in the next county west. We were to do the advertising, vet the customers, provide information to them, set up showings for the owner to do. We’d also do the contrast and keep the legal work moving forward. It didn’t take long for the owners to get tired of showing their farm and not getting a sale. They’d have to rearrange their personal schedule to accommodate the customers, wait for them to arrive and deal with a few who never arrived yet never told anyone they’d changed their minds. I actually got a buyer for one farm and then - you can’t makes this up - the guy decided to buy a home the owner’s mother wanted to sell. A house in town, not a farm. So he never got his place sold and I never got a commission. But the buyer got a house. Whoopee.
A year later, I learned of a property that sounded to too good to be true and made arrangements to visit it, over next to Lake Champlain. Well, it wasn’t as nice as I’d been led to believe but even so, it was a great buy. The land was nice enough but there were suspiciously few farmers in the area. I wasn't sure what to make of that. Pressure from vacationers? We listed it - only to learn two weeks later that they listed it exclusively with a local agent. How could they forget this? It made us look terrible, it’s a total breach of protocol. The other agent was really nice and offered us a Co-Exclusive on it. We found a cash buyer right away, someone I’d worked extensively with a few years prior. He’d seen an ad, called me, then drove up from Florida to see it. The sellers hemmed and hawed, then sold it to someone else, someone they knew. We didn’t make a cent - I don’t know about the other broker. I learned a year later that their deal did not work out (it involved some sort of rent), but by then, I’d had enough of that place and thought I’d never see that town again.
That lasted a few months, then Paul Brion called. We’d been talking about property over this way for a while. He asked me to list his place. Like a fool, I went up to visit and decided I could sell it. He owned 100 acres, but cropped 1000, all of it totally rent free. Paul is a good farmer - you could tell it was land he used just by looking at it. Better crops than any neighbor’s. He had good markets for his feed and was making a lot of money. That brought customers in and I showed it quite a few times. Then Paul recognized he’d never made more money anywhere else and decided to stay. Disappointed, I couldn’t blame him, he really was best off to stay.
Then Jake Calhoun called, wanting a place. We found him one and he asked us to sell his property for him. Only he was in St. Lawrence County. I went up to look at it. He’d made a local reputation for the quality of his beef and he wanted more of a farm, and in a more affluent area (which St. Lawrence County most decidedly is not). The “farm” was barely worthy of the name, a lot of woods and just a bit of wet and rocky pasture. But a nice home, frontage on a great river, and a reasonable price. He would do the showing and we’d do everything else. He also listed another property with us - a freestall, a bit run-down, on 14 acres, on a major highway, with ho home. Who is going to want something like that? To my amazement we found a cash buyer for that right away and the sale went like clockwork. But no one would call on the farm and Jake finally gave up on us a couple of years later. I think he’s still there. It’s just the wrong area for our customers.
When a place is closer, we save a ton of travel time and gas. We know the local market, who to recommend for services (lawyers, inspectors, banks, contractors, feed dealers….) and we know the ins and outs of life here. We can answer customer’s questions and help them after the fact. We know what the good buys are here and can make useful recommendations to both clients and customers. We can authoritatively field concerns about weather, jobs, schools, zoning, shopping, hospitals, all that sort of stuff. We know who the good lawyers are and who to avoid. Buyers can come to us and see several places in a day, not just one. When you work out of the area, none of this is the case.
There were several others I could mention. I’ve told you about every single sale I made out of the area, all one of them, the lucky one for Jake. Go too far from home and you just handicap yourself and don’t help anyone else. On the other hand, my everyday local area is 5000 square miles….
What gives land (not buildings) its value to people? Here’s what is most commonly valued, based upon the order I think of things. You may order them differently - and should.
WHAT ADDS VALUE ?
1) A mixture of open and wooded land
3) Water (steams, rivers, farm ponds, lakes – generally, the bigger, the better)
4) Green open fields, or fields growing impressive crops
5) Privacy and quiet (which are not the same thing)
Some are merely amusing, some can be an immense help. All are interesting.
After 40 years, I've learned a lot, & acquired unforgettable experiences. Follow these long enough and you'll eventually get the whole book. (Names probably changed, for obvious reasons.)