It seems if it is treated as a single property, it is to be valued as same. If there is some hoop that must be jumped through (say a survey or a division of the tax parcel) then you do not have an "as is" report. "As is" you have one deeded property and should use comparables that are two properties. Having 2 addresses is not uncommon in rural areas. My property has 2 addresses since I had to have one for each water tap which are over ½ mile apart. So my farm water tap uses a second address.
The HBU would (in the future) be to divide into two parcels likely. But the "AS IS" value is what exists here, now, today...not to speculate about some future use that is the result of a future event (subdivision).
If someone can buy the two, split them for $7,500, and make a 25% return on the total purchase price, chances are that someone is going to do that.
The present worth of the property is based on the future benefits: if investing $400k now and getting $492,500 in a year (let's say) is likely, then that's going to happen. Because the value of the property "as is" is based on its value with the lot split factored in. That isn't hypothetical. That's real and as-is.
The problem is it is rarely as clear-cut as I describe it. A decision to invoke the "value as a lot split" methodology needs to be well supported, and not just "well, maybe, and if all the stars align, blah, blah, blah"; ergo, the need to do a credible H&BU.
I just did an appraisal 2-weeks ago. A local developer purchased a home that was listed on MLS for upper $700k's late last year. The MLS listed it as having development potential; it was an estate sale, and the heirs wanted to liquidate; there was definitely non-market motivations of the sellers.
This property does have subdivision potential, and I was able to confirm that after visiting the planning department and fire department. If you look at the sites around this property, you can see that most of the sites have been subdivided over the last 30-years. The improvement, as-is, was near the end of its economic life (although it had continued useful life; it wasn't a total tear down, just functionally obsolete in a number of ways); but it could have functioned as a rental.
H&BU, as-is, was to split the lot and build at least one new home at the rear, and keep a wall of the existing improvement and build a 3,000 home there. My opinion of market value was mid-$900k's. And, there was a possibility that rather than 2-lots, this property cold have been divided into 3-lots; possible, but not enough data at the time of my assignment for me to say "probable" with confidence (although I discussed that additional 3rd lot potential in detail and presented my rationale for not making the 3-lot split my conclusion).
The value of the property, as is (not split) was mid-$900k. Nothing hypothetical about it. The present value based on the future benefits, which were tangible and not ephemeral.
One of the biggest mistakes I've seen in others' work in these cases is that they mis-price what the lot split is worth (usually over-value it) because many value the excess land similar to a finished lot when it isn't (in a lot of cases, it is more similar to raw land and is not a site-ready-to-build).
But the discussion you and I are having (and, potentially the disagreement) should make one thing evident to everyone: These assignments are not simple. They are complex. The further one goes down the excess land or lot-split conclusion, the more analysis and research is needed. And, the decision to conclude excess/lot-split action needs to be compelling, not just a "49% no excess land, 51% excess land, therefore excess land". In the real world, when informed market participants make these decisions, they want to make sure that the ability to split and the resulting value after the split is compelling because they are going to put up real money, and most savvy investors in these types of situations expect to make a large portion of their profit on the buy-side of the site(s).
Like the buyer/developer in my case did.
