As you venture into the world of land buying and owning, you’ll want to get familiar with common land use definitions and language.
In this blog, we’ll talk you through land use and what you may need to know.
Let’s jump right into it.
Why does land use matter to you?
Land use is how a property is characterized based on what it can be used for and what is built on it.
Almost every jurisdiction in the US regulates the use and development of land within its boundaries.
As a land-owner or buyer, you must understand the allowable uses of your property or you may be disappointed to learn you cannot use the land the way you would like.
One important thing to note as you buy and sell land is that land use is NOT zoning.
Zoning is how the government regulates land and is codified in local zoning laws or ordinances.
Land use is a more nebulous term.
It can refer to the way that people (landowners) adapt the land they own to suit their needs through arrangements, development, or activities.
Or it can refer to the way that a jurisdiction controls and directs real estate development within its boundaries.
As you can see, the two terms are highly connected because how the government regulates land can impact how individuals use the land.
Top five land use definitions you should know
For now, let’s focus on the land use regulations that are typically part of a zoning ordinance.
Zoning ordinances divide all properties into different land use categories (such as residential or commercial).
Each category will have a set of allowable uses or ways in which a property owner can develop or utilize their land.
How does this affect you?
At a high level, it means that you are not able to develop your property in any manner you see fit.
For example, property in a residential district cannot usually be developed for commercial uses.
To help you understand how this all works, we have listed the five most common land use categories that you will see in zoning ordinances below.
We’ll break them down one by one to show you the different activities you may use land for after purchasing it.
1. Agricultural
Agricultural land is used for growing and harvesting crops as well as raising livestock.
In most cases, agricultural zoning districts also allow for standard residential uses (such as building a single-family home).
Agricultural land tends to be fairly flexible, and most parcels of rural vacant land will fall under this category.
Agricultural lands include a variety of different types of property like farms, ranches, homesteads, and hobby farms.
For clarity, here’s a breakdown of each of these agricultural uses.
Farm
A farm is land used for growing crops and rearing animals for profit.
There are different types of farms including crop farms, fish farms, dairy farms, poultry farms, and meat farms.
In all of these scenarios, farmers take the products they make on the land – whether they’re vegetables or animal products – and sell them for economic gain.
This is their livelihood and how they survive.
Ranch
A ranch is a place where livestock is raised and grazed to produce meat and other products.
Typically, ranchers raise large animals in range conditions and the most common example is a cattle ranch (although you will find other animals on ranches as well).
Ranchers will herd livestock and help them graze so they grow larger for slaughter.
They will then sell them for economic gain.
So, like farmers, ranchers typically rely on their ranch for their livelihood.
Homesteads
Homestead refers to a house and its surrounding land, which is typically owned by a family.
If you’re looking to purchase an agricultural property for the purpose of living off the land, you’re likely interested in homesteading.
What differentiates a homesteader from a small farmer is typically the philosophy.
Most homesteaders are looking to create a completely self-sustaining life by living off only what they produce.
Hobby farms
Hobby farms are also agricultural land.
However, they are usually used primarily for pleasure or recreation rather than a means of making a living.
Still, the individuals who own hobby farms or ranches do use the land for an agricultural purpose, even if they are not motivated by profit.
2. Commercial
This is a category of land that you likely engage with on a daily basis.
It is defined as land designated for businesses, warehouses, shops, and other infrastructure related to commerce.
Commercial land is usually included in city planning because it is essential to the economy of a community.
If you’re interested in investing in commercial real estate, you’ll need to pay careful attention to zoning regulations.
This is because you often can only use a property for commercial purposes if your land is located within a commercial land use district.
While there is usually a process in place to request a zoning designation change (called a variance), more often than not you’ll have to work with existing zoning regulations for any land you want to invest in.
Having said this, land use is sometimes defined as “mixed-use.”
Mixed-use properties can have a combination of commercial and residential uses.
For example, if a residential property has a small business on the premises, then it would be defined as mixed-use.
In this case, the small business would have to have numerous customers visiting the property in order to have this land use definition.
So anyone working from a home office would not qualify.
Different zoning designations have different ways of handling mixed-use buildings, but it is sometimes possible for a mixed-use building with commercial uses to be located in a district other than a commercial district.
3. Recreational
Recreational land is used for recreational purposes such as…
Athletic fields
Gymnasiums
Playgrounds
Public parks
Green spaces
Public beaches
Swimming pools
Camping sites
Motocross tracks
Fishing
ATVing
Recreational land is often owned by a city or government entity (think of national parks), but it can be owned by private citizens as well.
Cities will add recreational land into their blueprints so that those in the community have a place to spend time.
This is commonly referred to as “green space” or “open space.”
Some cities have been even more intentional about adding green space back to their landscape or buying back old, abandoned pieces of land rather than allowing developers to come in and redevelop them.
Private citizens can also contribute to the recreational land of a community.
They may create sports fields, camping sites, or hunting land and then charge a fee for use.
They may also choose to keep their recreational lands entirely private for personal enjoyment.
In general, recreational lands are important to a community and attract permanent residents and visitors alike.
If you’re looking to purchase recreational land, you should always keep other zoning regulations and restrictions in mind.
It is especially important to check all zoning regulations if you’re seeking to hunt or build on recreational land since not all recreational land use districts will permit this.
4. Residential
One of the most common of all land use definitions is residential land.
As the name suggests, residential land is land where homes are built.
These may be single-family homes, manufactured (mobile) homes, or apartments.
When looking at residential properties, there are a few factors that are important for land buyers.
Proximity to local amenities
Local schools
Crime rate
Accessibility to the property
Often, the types of animals and structures permitted on these properties will be restricted as well.
While dogs and cats are typically okay, pigs, horses, or other livestock are not.
If you’re looking to build any type of structure other than a home on residential land, you often need to have additional permits.
There may also be restrictions on the size of the building and how far it must be from all property lines.
For more on building, you can watch our video below on how to buy land and build a house.
5. Transport
The final of our land use definitions is transport land.
This is land utilized for the structures that enable people to get from one destination to the other.
So, think about land used for roads, airports, train stations, and subway stations.
Transport land is highly important to the community because people need to get around in order to live, shop and enjoy their neighborhood!
Transportation land is often owned, planned for, maintained, and upgraded by the city, although it can also be owned by other entities, such as the county, state or federal government or a homeowner’s association (in the case of private roads).
Final thoughts
These zoning land use definitions are crucial to know when investing.
If you ever played SimCity as a child, you know land use parameters often exist in order to make land livable for all.
Land use impacts long-term activity patterns, zoning patterns, government regulations, land availability, public utilities, and telecommunication infrastructure.
It tells us about what governments prioritize and about human trends and movements in that given period of history.
Land use will continue to change and evolve over time.
As a landowner or developer, it’s up to you to maintain your knowledge.
Additional Resources
Don't forget to explore our unbeatable $1 Down Land Listings + Vacation Giveaway!
Would you like to receive weekly emails with our latest blog/properties?
Disclaimer: we are not lawyers, accountants or financial advisors and the information in this article is for informational purposes only. This article is based on our own research and experience and we do our best to keep it accurate and up-to-date, but it may contain errors. Please be sure to consult a legal or financial professional before making any investment decisions.
Prior to starting Gokce Capital, Erika received a Bachelor of Architecture from the University of Southern California and a graduate degree in Urban Policy from Columbia University. She worked as both an architectural designer and engineer in New York before joining the New York City Department of Housing Preservation and Development.
Erika currently lives in the New York Metropolitan area with her spouse, daughter and cat. She is originally from Chicago and still considers herself a midwesterner at heart.
Erika also loves to read, write and travel (fun fact, she has visited all 50 states and more than 30 countries!). Her new book, Land Investing Mistakes: 11 True Stories You Need To Know Before Buying Land, is now available on Amazon.
I have a question. I purchased 7 acres in 2013 . Barn a shed and another pole building plus house . My house caught fire in 2019 . My wife and 1 grandchild and I live here. Insurance company was great and we had a modular home set up . The property was agricultural. Now they have changed it to residential and raised our taxes 4000 dollars a year . House payment goes up 488 dollars a month . I went to dispute this and was rudly told thats the way it is . We will have to sell or loose our home . What do I do or who to talk to over these people . I have 2 horses that will have to find a home . This is the saddest thing .
Hello Ray, I’m very sorry to hear about your situation. I would recommend researching what the assessment appeal process is in your area and then submit a formal appeal to have your assessed value lowered. You can also speak with a local real estate agent as they often know how the process works and can often advice.