How Much Is Your Land Worth? Why the Comps Might Mislead You 

By John Finegan | Broker

You own a piece of land and think it would make a great development site. So, what’s it worth?  

Clients ask me this all the time, and the honest answer is never simple. Zoning, construction costs, the broader economy, what’s in the soil, and, in the end, a bit of a poker game with the buyer all play a part. 

The usual shortcut is to look at comparable sales, or “comps,” meaning what similar land nearby recently sold for. Comps are a fine starting point. But in today’s market, many of them describe a world that no longer exists. 

Land Value Is What’s Left Over 

It helps to think of land value as a simple formula: 

What you can build and what that build is worth, minus the cost to build it, equals what the land is worth. 

Land value is whatever is left over. If zoning allows more to be built, land value goes up. If construction gets more expensive, it goes down. If the site turns out to be less usable than it initially seemed, it goes down. When any piece of the formula changes, the answer changes too, and that’s why old comps can be misleading. 

The Rules Have Changed 

Take Portland. Several large land sales from the past five years are now becoming major housing developments. But nearly all of them happened before ReCode, the 2025 overhaul of the city’s zoning code. ReCode increased what can be built across the city and added a height map that made some parcels considerably more valuable.  

A sale before ReCode and a sale after it are fundamentally different deals. Land trades infrequently, and many deals take more than a year to close. That means there aren’t enough post-ReCode sales to rely on yet, and even some deals that closed after the change were priced before it. 

Portland’s inclusionary zoning adds another layer of complexity. Housing projects with 10 or more units must make a share of those units affordable or pay a fee instead. When the policy began in 2015, it required 10% of units to be affordable to households earning 100% of the median income or pay a fee of $100,000 per unit you don’t built (so, in effect, $10,000 per unit across the development). In 2020 the requirement rose to 25% of units affordable to households earning 80% of the median income, and today the fee works out to about $186,088 per unit you don’t build (so, in effect, $46,522 per unit across the development). A sale from 2018 and one from 2022 reflect very different costs for a developer. 

And it’s not just Portland. Earlier this year, Falmouth replaced its BP zone along Route 1 north of Bucknam Road with a new R1N zone that allows more uses and greater density. If you’re valuing land in that corridor, comps from before the rezone are essentially unusable. 

Costs and Values Keep Moving 

In recent years, both sides of the formula have been volatile. Since 2021, interest rates have doubled, tariffs on imported materials have come and gone, inflation has run roughly 23%, and skilled labor has been scarce. A land sale from 2022 reflects a completely different economy than one today. 

The value of what gets built has moved too. An apartment building with units renting at $2,000 a month is a very different asset than one at $2,500. Condos projected to sell for $1 million instead of $1.3 million produce a very different bottom line. Rising housing prices are hard on buyers and renters, but they push land values up and can be the key differentiator as to whether or not a development is built. 

Will the Land Cooperate? 

Then there’s the wildcard: is the site actually buildable? Plenty of land looks great on paper: good zoning, highway access, and a strong school district. Then due diligence begins: wetland studies, soil testing, an environmental assessment, a title search, etc. Suppose the buyer finds a neighbor’s easement across the property that makes development impossible. The “what can be built” side of the formula disappears. 

That’s why I encourage sellers to complete these investigations before listing them. Every serious buyer will do them anyway, and a site with known answers is a less risky purchase, and more valuable, than one a buyer must take on blind. 

The Bottom Line 

So, what is land worth? It depends. Anyone who gives you a quick per-acre number without looking at zoning history, regulatory timing, construction costs, end values, and the site itself is guessing, not valuing. Comps still matter, but they need to be adjusted, questioned, and sometimes thrown out. The most reliable number comes from working through the formula piece by piece, and that is where local knowledge beats a spreadsheet.