How Much Should I Charge for an Easement?

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“I am trying to determined how much to charge for easements that one of my neighbors wants across our property.  Is it a percentage of what the property would sell for, or do you have the property appraised and then determine by that?  This is for the purpose of developing his property and he is requesting three separate easements across our property.”

[NOTE: Articles and answers on DearEsq., while written and published by lawyers, do not constitute legal advice, and no attorney-client relationship is formed by your reading of this information. You should always consult with an attorney for any legal situations.]

Unfortunately, there is no simple answer. The value is usually not simply based on a percentage of the value of the property – which makes sense, because your neighbor isn’t buying the property, just the use of it. For example, if the easement is a driveway, you can use it, too. If the easement is for a utility line, you may hardly notice that it’s there (except when it comes time to dig a trench to replace the line).

It’s a negotiation, and it usually depends on how much it’s worth to the two parties involved. Are these easements necessary for the development of your neighbor’s property? If so, they could be very valuable, indeed. But your neighbor isn’t going to pay more for a driveway easement (for example) than it would cost to route the driveway somewhere else.

On the flip side, how much will this harm you? Having an easement on your property, aside from meaning that your neighbor gets to use it, also limits how you can develop your own property. You should check with the city or county to see if the restrictions are greater than you think. For example, some municipalities restrict how large
your house can be as a percentage of the total area of your land, and they may deduct the area of an easement. So even if your house is nowhere near the easement, it could be affected.

I’ve seen easements go from next to nothing (just the cost of drafting and recording) up to tens of thousands of dollars and more. Where your situation falls in that range will depend on how much it’s worth to your neighbor, and to you.

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Author: Anne P. Mitchell, Esq.

Anne P. Mitchell, Esq. is a noted family law expert, Internet law expert, and Professor of Law at Lincoln Law School of San Jose. She is the author of "Surviving Divorce: the Single Father's Guide" and "The Email Deliverability Handbook"

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