Depends entirely upon the local market and demand and location. If it's in Palo Alto, expect to pay in the millions.

No, it's rural and something comparable I could calculate for lot size. I just wasn't sure if just having a structure there automatically makes it worth more? I don't think the market is there so much as I know of two much larger lots that are about four times the size for double the price and have been for sale for years now.

I am negotiating at FMV and unfortunately for the seller, she was totally fleeced 8 years ago but I can't let that make me pay more.

When building being able to call something a remodel is usually better then a new build (Permit wise). That’s why many structures aren’t taken completely away, a wall or corner will remain and the house is considered a remodel. Depending on your own local codes, of course.

If the building was condemned, I would ask the seller to either remove it or reduced the price by the amount to remove the building and a 5-10% fee, and require money in escrow to deal with environmental issues should they arise.

If the building has not been condemned, maybe the seller has placed a value on the building.

I recommend you hire a buyers real estate agent. FMV may caused you to be fleeced.

Thanks for the input. We have just been dealing with the agent on the seller's behalf. We should find someone for us. This isn't a "dream cottage" situation just a true cottage that is safe and place to kayak and swim hence us even considering such a small lot. Plus the remodel (proper term,thanks maddielee) is something that is up our alley.

The building isn't condemned but it need of major repairs. It has been severely neglected.

Agree with littlebug. Same in my area. Cost of demo and removal if a factor.

Definitely get an agent that is working for your interests and not the interests of the seller.

Consider getting an appraisal for the property. This may help when negotiating with the seller that was 'burned' on the front end by paying too much for the property. You are right though - that isn't your problem to solve. An appraisal may go a long way toward making the seller understand s/he is doing the best they can under today's market influences. Sometimes the best solution is to cut your losses (seller to cut her losses) rather than to continue to hang on.

Also remember that there is probably Septic and electric on a lot that already had a house on it.

Yes, there is toilet septic but not grey water septic. No well. It will be up to us to install and/or upgrade.

what figure does the taxing authority have as far as the value of the land and also of the structure?

$37,000 for the land

$53,000 for the structure

I find the structure surprising because it's a mess. Inside has sloping floors (needs levelling and probably new joists as there is bounce) and roof has sagging.

$90K how much do YOU think the property is worth? and if you DO purchase it will you be protesting the taxed valuation?

Offer whatever you like but the seller may have a different idea about the value. It takes a willing seller and an able buyer to make a deal.

I used the neighbour as a comparable (better lot and new structure) and empty lot comparables. The province (I am buying in) has an excellent website that lets you know what the lot dimensions are, purchase price and assessed value of land and structure.

We did put in an offer. It's odd that I feel so bad because the seller paid so much more that what we offered. But we are also offering $20,000 over the highest bill to date. Yes, true sushipup1, it really doesn't matter what just I think. What is good is past a price (my FMV), I have no more interest so there is no "emptiness" about potentially not getting it.

It sounds as if it's a tear down with limited infrastructure. Land value less the cost to demolish and haul off.

If it's salvageable, then land value only.

But remember that the land value has nothing to do with those tax values you posted. Most of the time, the tax value is quite a bit lower than market value.

Also, I have had many buyers tell themselves that a particular home was a "teardown", only because they did not understand construction or understand that most items can be repaired easily.

Yes, it was pretty much a complete rebuild - only partial frame would stay. Regardless, the property was taken off the market due to too low offers. Maybe the seller will list again in the spring. My interest has faded on this property.