Normally, when you see a property listing, you see one set price. When you buy the property, the price you pay becomes the property's market value. So, if you pay $500,000 for a home, your property is worth $500,000. Although you just see one price, in the real estate world your property is divided into two values: the improvement value and the land value.
The property improvement value is the value of the sticks and bricks. The sticks and bricks could be anything allowable by building code, ranging from 5 Star Hotels all the way down to a storage shed or a half-complete foundation. The land value is based on the development potential of a site, which can be determined by different factors. The most important factor is the location of the land, but zoning regulations and presence of hazards such as being in a flood plain are important too.
When you see the property's listing price, it can be difficult to split the property into a land value and an improvement value without having a lot of knowledge in real estate development. That being said, there is an entity that does this job for you, and you can access their data for free! Most county real estate appraisers separate properties into land and improvement values. Although it can be difficult to obtain and sort through this data, Site Identify has combined county and city data into one platform that makes it really easy to find development sites.
The official Site Identify blog
David Morin (co-founder)