Why should an appraiser confirm the zoning of each land comparable rather than assume it matches the subject?
Correct Answer
D) Permitted use and density drive what land is worth
Zoning can affect permitted use, density and development capacity, so verify each sale’s relevant zoning and permissions. Also consider physical and financial feasibility. A difference requires analysis; it neither automatically invalidates a sale nor disappears because both parcels are vacant.
Why This Is the Correct Answer
Zoning can affect permitted use, density and development capacity, so verify each sale’s relevant zoning and permissions. Also consider physical and financial feasibility. A difference requires analysis; it neither automatically invalidates a sale nor disappears because both parcels are vacant.
More Land/Site Questions
How should an appraiser account for a site's access to public sewer compared with competing sites that require septic systems?
Which fact, if supported by competitive-market evidence, most directly supports a unit-price premium for an otherwise comparable site?
A rectangular site's frontage is doubled while its depth is halved, keeping area constant. What is the likely value effect in a retail district?
A downtown site's zoning height limit is reduced from six stories to three. Buyers in this market had been paying for six-story development potential. What effect on land value is most supportable?
A zoning change increases permitted density from four to eight units per acre. What is the likely effect on site value?
Using the allocation method, market evidence supports a typical land-to-total-property-value ratio of 28% for similar improved properties in the subject’s location. An improved comparable sold for $825,000. What land (site) contribution is indicated by applying that ratio?
An appraiser is valuing a vacant site near a landfill. A similar vacant site that is not affected by the landfill sold for $480,000. Paired land sales indicate that proximity to the landfill lowers site prices by $70,000. No other adjustments apply. What is the indicated value of the subject site?
An appraiser is extracting site value from a $600,000 cash sale. The seller's records show an original construction cost of $250,000 and a depreciated book value of $110,000. The appraiser estimates current replacement cost new at $400,000 and accrued depreciation from all causes at $100,000. What is the indicated site value?
Three parcels assembled under single ownership (standard appraisal guidance assemblage) support separate as-is values of $290,000, $340,000, and $250,000. After assemblage for a higher-utility use, the combined site is valued at $1,050,000. Assemblage costs (demolition, legal, holding, and related) total $55,000. What is the indicated net plottage (plottage increment after assemblage costs)?
A comparable commercial site with 65 front feet sold for a cash-equivalent price of $585,000. Per standard appraisal guidance, sale price per front foot is a vacant-land unit of comparison when frontage is a primary value determinant. The subject site has 72 front feet and is otherwise similar. What indicated land value does the front-foot unit support before other adjustments?
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Previous Question
In a hypothetical subdivision cash-flow model, a supported remediation payment of $350,000 occurs exactly six months after the valuation date. Using a 14% effective annual discount rate with compound fractional-year discounting, what is that payment’s present value, rounded to the nearest $100? This asks only for the payment’s present value, not the property’s total environmental value effect.
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Under the land residual technique, stabilized NOI is $210,000. The building is worth $1,800,000 and is capitalized at 8%. The land capitalization rate is 6%. What is the indicated land value?