How Much Is A Utility Easement Worth?

Do you own land in a residential or rural area? If you do, there’s a chance that a utility easement runs through your property. While the land still belongs to you, utility companies might have special rights to a specific patch of land on your property.

A utility easement is often worth less than the physical space it takes up on your land. This is because a utility easement doesn’t mean you’re selling a piece of land. It means you’re selling the rights to that piece of land.

However, the value of a utility easement depends on how much it will impact your ability to use your land. Determining how much a utility easement is worth is an imperfect science. There are land appraisers who specialize in valuing easements. However, there is no one universal appraisal method.

Utility easements can either be temporary or permanent. Temporary utility easements are common but have little to no effect on property value. Permanent utility easements are more difficult to appraise. This is because their value factors into the total property value.

In regards to how their built, utility easements can be overhead, surface, or subsurface. Overhead easements can include telephone or electrical lines. Surface easements might entail drainage or sewage systems. Subsurface easements can include communication or sewage lines.

However, it is important to note that many utility easements will take the form of two or even three of these types. For example, an overhead electrical line might require a pole to be installed on your property. The type of utility easement on your property impacts the land usage, and ultimately, the value of your property.

Valuing the worth of a utility easement is difficult given what is actually being sold. When a utility easement is being appraised, it is not the physical land that is being evaluated. Rather, it is the rights to that land that are being exchanged.

As a result, easement valuation is based not on the benefit to the utility company, but the detriment to the landowner. Given the complicated legal nature of easements, it is important to consult a professional appraiser when buying, selling, or transferring land.

The Federal Method, sometimes referred to as the “Before and After” Method, is a simple calculation. It assesses the value of the total property before the easement is in place, and the value of the total property after.

Based on the Federal Method, the value of the utility easement is the difference between these two numbers. For example, a property could be worth $100,000 before an easement is acquired. After the easement is acquired, it could be worth $95,000. The easement would then be valued at $5,000.

Before building anything below or above ground, it’s important to know if you have any easements on your property. You may be taking on a large project like building a house. Or, you could be taking on a smaller project like constructing a dry well. Either way, understanding your property rights can save you a lot of time and money down the road.

For example, you might build a deck over a subsurface telephone line. However, if the telephone company wants to access it, they may have the right to destroy your deck to do so. Checking whether or not you have a utility easement running through your property could be as simple as looking at the title or deed.

At the time of purchase, you can also task your real estate agent with uncovering that information.