Why Does Soil Type Matter for Land Valuation?

Without improvements to comprise a large portion of real estate valuation, the particular components of an undeveloped plot of land becoming increasingly important contribution to overall value. Elements such as location, grading, utilities, and frontage can make a huge difference in a land valuation. The type of soil is another important component of land valuation.

The property’s soil classification is important because it has potentially huge implications to the cost and feasibility of future use and development. Issues related to soil classification are important because they determine the hydrology of the land. Hydrology relates to the drainage of the soil, so it can be incredibly important when determining the cost of development. If the soil does not allow for adequate drainage, additional measures may need to be implemented to properly account for runoff and erosion due to rainfall. Soil classification can also determine whether or not the land has the ability to hold the weight of a structure without slipping or cracking.

Appraisers Use Soil Type When Calculating Land Valuation>

Appraisers commonly use data about soil type as part of the land valuation process. Anyone interested in purchasing or leasing a plot of land for development will also have an interest in the soil characteristics. For example if you were approached by a wind energy company, they’d be interested in knowing whether their turbines would sink into your soil or not! While a particular soil type may not preclude the land from a specific land use, remediation costs to prepare the land for development may not make it financially feasible.

The Six Most Common Soil Types

Soil in every part of the country takes one of six major forms. Soil classification is based upon the size and texture of the particles in the soil as well as the mineral and nutrient type.  Based on those characteristics, soil may be defined using one of these terms:


Loamy soil is about 40% sand, 40% silt, and 20% clay. The texture of this soil is especially good at retaining water and nutrients. Therefore, loamy soil is excellent for vegetation and plants. It is also excellent soil for supporting a construction foundation.


Sandy soil quickly drains water after rain, so they provide good drainage in areas with high amounts of rainfall. In dry areas, however, the soil is poor for vegetation and plants because of its inability to retain water and low nutrient levels.  Compacted sand is fairly good for foundations, but it is possible for particles to lose their friction when wet and create large gaps under the foundation


Peaty soil is made of water-logged, partially decomposed plant matter, moss, and other acidic plants. It can take up to 10,000 years for this material to become peaty soil in a poorly drained wetlands area.  Peat is excellent for vegetation and water filtration, but it is not ideal for construction. When dry, peat can actually become a fire hazard. It is also easily compressible when dry and thus not suited for supporting the weight of a large structure.


Silt is composed of very small particles that cause it to feel smooth to the touch. When wet, silt is very slippery and tends to retain water quite well. Silty soil can result in drainage problems, and its tendency to expand when wet can cause it to push upon a foundation. As a result, silty soil is not ideal for construction.


Chalky soil tends to be light brown in color and may contain larger pieces of calcium carbonate or limestone. Because of its highly alkaline chemistry, the soil is not appropriate for a large population of vegetation. Areas with chalky soil possessing a high proportion of limestone or calcium carbonate are also susceptible to sinkholes.


Clay has the smallest grain size of any of the soil types. Its small grain size allows it to store water very well, but that also means clay expands when wet and shrinks when dry. This tendency causes clay to be very pliable and easily moved and manipulated. This cycle of constant expansion and contraction can wear down the foundation of a construction and cause it to develop cracks. In addition, clay soil is not particularly good for growing plants and vegetation.

Free Ways for Landowners to Determine Soil Type During the Land Valuation Process

Landowners who want to find out more information about the type of soil they have and its potential impact on property value and development do not necessarily need to hire a geologist or environmental consultant. The National Resources Conservation Service of the U.S. Department of Agriculture maintains a website allowing users to create maps of land they own or are thinking about purchasing. Users can define a particular area of interest and access detailed soil descriptions for the location. They can also use a tool called the Soil Data Explorer to save soil and crop suitability data. In addition, the website allows users to create maps and order a free, printable analysis of the soil in a select location.

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