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Acreage Value
- Thread starter Mercury
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fifteen
Senior Member
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- Nov 15, 2008
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- Certified Residential Appraiser
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- Washington
To be honest with you, I have to conclude there's not very many good appraisers on this board and the claimed experience and status of some of the most vociferous should be called into question. Their professionalism certainly does need to be.
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fifteen
Senior Member
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He paid the going price for 25 acres as that's all he needed. If the market says 25 acres is most desireable and the 40 acre holder wants to sell, then he must compete with 25 acre lot prices. Let the market tell you, don't speculate.
CANative
Elite Member
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- Retired Appraiser
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- California
Using the scenario I just posted, if the subject was 38 acres and otherwise similar it would be safe to conclude an opinion of value of $47,500 ($1,250 per acre x 38). If the subject was 43 acres you could apply $1,250 to the 43 and conclude $54,000 (rounded).
If the subject was 75 acres or 12 acres, you need a new set of comps.
It's poor appraisal practice to compare sales of signficantly larger or smaller size parcels.
If the subject was 75 acres or 12 acres, you need a new set of comps.
It's poor appraisal practice to compare sales of signficantly larger or smaller size parcels.
Ken B
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Richard is correct, but with regard to the property characteristics around which this subject pertains, HABU in the condition "as is" regards the nature of the additional acreage. HABU analysis will reveal if the acreage is surplus or excess.
If surplus, the law of decreasing returns would normally dictate that each acre greater than that which is typical for the neighborhood or necessary to support the primary improvements will have less value than the acre preceding it. This is logical as the additional acreage has increasing limited utility but increasing overall holding expense.
On the other hand, if excess, the additional acreage could have greater utility as it could be capable of supporting additional development. For example, if minimum lot sizes were 5 acres and the land was capable of supporting development, in the case of the subject property it is possible that the property could be subdivided and put to a more intensive use. With greater utility, the land has greater value per acre than if there was no subdivision potential.
In the case of the subject, it is reported that there are no other parcels of similar size in the area. Why not? That question has not been answered. Is it legally possible to subdivide? Perhaps. Would the land support additional development? Perhaps. Are there any factors significantly affecting the cost of development? Don't know. What is the most productive use and what is the timing of that use? Don't know.
As was initially set forth by some of us at the beginning of this thread, there are simply too many unknowns about the property to make blanket statements about regarding potential contributory value of each acre greater than that needed to support the primary improvements. Metamorphic, to my knowledge, was the only contributor to this thread that actually presented a reasonable and logical method to value the additional acreage.
The proposition that land in excess of that needed to support the primary improvements has no value is preposterous and laughable. Would it have less value than the minimal site area necessary for the improvements? One would certainly think. But how much less is an unknown that no one here can ascertain based upon the information provided. Those that would throw out blanket assumptions and generalities, even if proven in their specific market segment, are doing a disservice to the receiver of that information. Especially when that information is grossly nonfactual.
If surplus, the law of decreasing returns would normally dictate that each acre greater than that which is typical for the neighborhood or necessary to support the primary improvements will have less value than the acre preceding it. This is logical as the additional acreage has increasing limited utility but increasing overall holding expense.
On the other hand, if excess, the additional acreage could have greater utility as it could be capable of supporting additional development. For example, if minimum lot sizes were 5 acres and the land was capable of supporting development, in the case of the subject property it is possible that the property could be subdivided and put to a more intensive use. With greater utility, the land has greater value per acre than if there was no subdivision potential.
In the case of the subject, it is reported that there are no other parcels of similar size in the area. Why not? That question has not been answered. Is it legally possible to subdivide? Perhaps. Would the land support additional development? Perhaps. Are there any factors significantly affecting the cost of development? Don't know. What is the most productive use and what is the timing of that use? Don't know.
As was initially set forth by some of us at the beginning of this thread, there are simply too many unknowns about the property to make blanket statements about regarding potential contributory value of each acre greater than that needed to support the primary improvements. Metamorphic, to my knowledge, was the only contributor to this thread that actually presented a reasonable and logical method to value the additional acreage.
The proposition that land in excess of that needed to support the primary improvements has no value is preposterous and laughable. Would it have less value than the minimal site area necessary for the improvements? One would certainly think. But how much less is an unknown that no one here can ascertain based upon the information provided. Those that would throw out blanket assumptions and generalities, even if proven in their specific market segment, are doing a disservice to the receiver of that information. Especially when that information is grossly nonfactual.
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Stone
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fifteen
Senior Member
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- Nov 15, 2008
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- Certified Residential Appraiser
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- Washington
Is this thread about others or is it about helping the OP author with his problem? I don't see how your narrative helped him at all. All it did was call any of my suggestions into question. That helps who??!!
Stone. He agreed. You got a problem with that? We were putting our heads together to solve a problem till the thread got hijacked with those with an agenda to discredit.
Dave gave me an infraction for telling a joke. Congrats guys if your intent is getting me kicked off here. Good day
I look forward to the solution the OP author has derived with so many non-consequential dogmas brought up that didn't address his question. I hope he can successfully weed through the spam to extract what he needs to do his job if he's still working on it. I'll bet it'll be a while before he brings another question up on this forum - congratulations guys.
Stone. He agreed. You got a problem with that? We were putting our heads together to solve a problem till the thread got hijacked with those with an agenda to discredit.
Dave gave me an infraction for telling a joke. Congrats guys if your intent is getting me kicked off here. Good day
I look forward to the solution the OP author has derived with so many non-consequential dogmas brought up that didn't address his question. I hope he can successfully weed through the spam to extract what he needs to do his job if he's still working on it. I'll bet it'll be a while before he brings another question up on this forum - congratulations guys.
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Ken B
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- Feb 18, 2004
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- Certified General Appraiser
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- Florida
If my post "called your suggestions into question", you may want to consider the signficance of the fact that my post was based upon basic valuation theory.
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