If you want to have a legitimate understanding of the real estate industry, then you are going to want to be well versed in the ways that land use is defined.
When researching properties, you are likely to find a number of different terms associated with land parcels available on the market. Before you acquire your parcel, you are going to want to ensure that the land use definition is in alignment with your real estate goals.
Land use definitions can be seen in the following classifications: residential, commercial, transportation, agricultural, and recreational. These definitions will determine how the land can be used and they will also dictate certain development limitations and restrictions.
Getting into the real estate industry comes with a lot of opportunities and a lot of responsibility. Land investments are one of the safest and most reliable ways to earn income in the United States, but in order to come out ahead in the real estate game, you need to play your cards right. Being well versed in land use definitions is going to be one of the most fundamental aspects of understanding property listings, as these are the classifications that will dictate what you can and can’t develop on the land parcel. A failure to understand the terms and conditions of land use definitions can result in serious issues in any development, which could potentially jeopardize your entire building project - or lead to legal complications. To help you understand this further, we are going to take you through our guide to understanding land use definitions to ensure that your real estate acquisitions run smoothly.
After extensively researching land use definitions, I have gathered enough knowledge and information to create a guide for understanding them. My experience has taught me that the best way to understand land use definitions is to be thorough with the analysis of the property you are assessing so that you are fully aware of its classification and limitations.
Table of Contents
Land Use Definitions Guide
Before you commit to any property listing that you are evaluating, you must ensure that you are fully aware of how the land parcel is formally defined by your state or local government. The Federal Government, on the other hand, typically - does not have the right to regulate how state and local lands can be used. Land regulations are more commonly associated with zoning rights, which determine how the government is allowed to establish the conditions of your land use.
The primary reason that land use definitions exist is to create an organized system of land parcels that are efficient, practical, and organized. We do this to enable better urban planning so that cities and townships are structured in a way that makes sense for residents, which is why you tend to see homes located in neighborhoods and businesses in city centers. Although land use definitions, can at times result in development limitations, they were ultimately designed for the right reasons.
If you are looking to develop a property or acquire a land parcel for a specific purpose, land use definitions can actually work greatly in your favor. To utilize land use definitions to suit your real estate interests, you should first try to establish a specific type of property classification that you are keen to acquire. This will help you narrow down your search when browsing property listings so that you are not wasting your time on parcels that are not aligned with your real estate goals. Keep reading to learn more about land use definitions and their various classifications.
Residential Land Use
One of the most common land use definitions in the real estate industry is residential land. A property that is classified as residential land can typically only be used as a private residence.
Residential land use definitions were established to make private households and neighborhoods more organized. For the most part, people want to live in private homes that are situated in locations that are ideal for living. Nobody wants to buy a home next to a noisy factory or industrial site, which is why creating designated areas that are solely used for residential use can be greatly advantageous for people.
In addition, residential land use also makes property acquisitions much more convenient for aspiring private homeowners and tenants, as well as real estate investors. If you are looking for a private residence, you are probably not going to want to waste your time evaluating property listings that are not ideal for living, which is why residential land use definitions can be very useful in this case.
However, residential land use can vary at times. This will primarily be based on where the real estate is located, which can be categorized as either urban residential land use or rural residential land use. With that being said, you should always confirm how these terms affect the property’s limitations for land use, as this can vary depending on the location of the parcel.
Urban Residential Land
A property that is classified as ‘Urban Residential Land Use’ will likely be a piece of real estate that is either located within a city or in the outskirts of one.
Urban residential land use was determined to create a logical and practical layout for city planning and urban developments. Private residences that are located in urban environments will likely be associated with the following kinds of property listings:
- Private Household
- Apartment Complex
- Mobile Home Park
These kinds of properties tend to have more restrictions attached to them, as urban residential lands tend to be heavily regulated by state and local governments. You will find that your local building authority will place restrictions on the dimensions of your urban residence which will dictate how large the development can be, its distance from a street or sidewalk, as well as the kind of agricultural use that can be pursued.
Real estate classified as Urban Residential Land will generally be valued higher than properties listed as Rural Residential Land. The reason for this is that these kinds of properties tend to have more attractive location qualities to buyers.
Rural Residential Land
Rural residential land is any private residence that is located in a rural environment. These land parcels will typically be located well outside of urban areas and may even be in a completely isolated area.
These pieces of real estate are established to ensure that the property is designated primarily for a private residence. However, rural residential land can often have restrictions that are less strenuous than urban residential land.
A land parcel defined as Rural Residential Land can have significantly looser restrictions for development limitations. These properties are not overly regulated by state and local governments and you will find that the dimensions of your home, as well as its physical location on the property, are not as important.
Commercial Land Use
Any property that you see listed as Commercial Land will be established specifically for businesses and industrial operations.
Commercial land use definitions were created to determine specific areas where business developments can be pursued. Much like with residential land use definitions, commercial land use enables better urban planning so that cities can structure commercial businesses to be located in designated areas for practicality. Here are some examples of commercial land use:
- Shopping Malls
For the most part, you will find that these commercial businesses will be situated within urban environments. However, certain commercial businesses are more commonly located outside of urban areas in rural environments. These would usually be large-scale commercial businesses that are attached to the industrial complex.
Large industrial operations can be quite invasive to urban areas, which can interfere with the quality of life of private residents, which is why state and local governments will commonly dictate the terms and conditions of a commercial business based on its location. If you are pursuing a real estate acquisition for a commercial business, it is vital that you confirm the limitations (if any) of the parcel that you are considering, so that you are within your full developmental rights.
Transportation Land Use
Any land that is established as Transportation Land, will usually not be available to the general public for acquisition - except for under very specific circumstances. However, transportation land can influence the terms and conditions of other types of land use - especially for large-scale commercial developments.
Transportation land is anything that is designed to enable or assist transport for the general public. With that being said, transportation land is rarely (if ever) on private land. Transportation land is primarily established by the government. These can be seen in the following categories:
- Bus stops
Essentially, anything land that enables transport can be considered transportation land.
If you come across a land parcel that is classified as Agricultural Land, it will be established specifically for farming purposes.
It is very rare to find a property that is listed as Agricultural Land within an urban environment. The most common places where you see agricultural land are out in the countryside. These are pieces of real estate that have been designated for the following purposes:
- Crop Harvesting
- Cattle & Livestock
The government has created this land use definition to create a certain amount of space that is reserved for food production. In order to preserve the health of our topsoil and prevent real estate developers from taking advantage of cheap land parcels, agricultural land classifications were created.
This property definition is generally not as strict as other land classifications, as farmers are often granted the right to build a private residence on this kind of parcel. Some agricultural land may, however, vary in specific agricultural use.
For example, areas that have rich soil and a suitable climate for crops may be restricted specifically for growing food. Whereas areas that have poor soil and a less favorable climate may be more lenient with these kinds of regulations and can be used for a variety of different uses such as raising livestock.
In certain cases, agricultural land may fall into a grey area. The government tries to encourage agricultural land by leasing publicly owned land to farmers for an extended period of time such as on BLM land. If public land was leased to farmers, for the duration of the contract, the land would technically be considered agricultural land and it can be used for the agreed agricultural purposes.
Any property that is defined as Recreational Land is generally open to the public and will likely be owned by the government. These kinds of lands were established to create a space for public recreation and can be seen in the following categories:
- National Parks
- State Parks
- Public Parks
- Nature Reserves
If a land parcel is listed as one of these classifications then it will probably not be available for private acquisition. However, there are some cases where recreation land is owned by a private individual.
Certain private landowners have designated parts of their property to be open to the public for recreational use. Although the land may be open to the public under specific guidelines, it would still be considered private property. A common occurrence for this is when a property has been converted into conservation land through an easement by a land trust or private individual.
About THE AUTHOR
Brittany has been in the land business since 2020 when the world was starting to shut down. Since then, we’ve sold to dozens of people from ATV weekend warriors to camping enthusiasts to retired truck drivers. Our inventory spans mostly in the western United States. We’ve been trained by experience, land acquisition courses, and hundreds of hours meeting with county assessors and clerks, zoning officials, realtors, and land investors. We’ve answered hundreds of questions from people regarding the buying and use of land.Read More About Brittany Melling