How do easements impact property value?

Easements impact property value primarily by placing restrictions on how the property can be used. When an easement is granted, it allows a third party to use part of the property for a specific purpose, such as access or utility installation. This can limit the property owner's rights and how they can utilize their land, potentially making the property less desirable to some buyers.

For instance, if a property has an easement for a utility line, the owner may not be able to build structures on that part of the land, which could diminish the overall functionality or appeal of the property. As a result, the perceived value may decrease due to these limitations, especially if the easement affects prime land or restricts significant development opportunities.

Understanding how easements can limit property use is crucial in real estate, as it allows appraisers to accurately assess their impact on property values.