Methods for determining the value of land plots. Approve the attached methodological recommendations for determining the market value of land plots. Methodological recommendations for determining the market value of land plots

MINISTRY OF PROPERTY RELATIONS OF THE RUSSIAN FEDERATION
ORDER
dated March 6, 2002 No. 568-r
"ON THE APPROVAL OF METHODOLOGICAL RECOMMENDATIONS
BY DETERMINING THE MARKET VALUE OF LAND"
(as amended by the order of the Ministry of Property of the Russian Federation dated July 31, 2002 No. 2314-r)

In accordance with Decree of the Government of the Russian Federation dated July 6, 2001 No. 519 “On approval of assessment standards” (Collected Legislation of the Russian Federation, 2001, No. 29, Art. 3026):

Minister
F.R. GAZIZULLIN

Approved
by order
Ministry of Property of Russia
dated 03/06/2002 No. 568-r

I. General provisions

These methodological recommendations for determining the market value of land plots were developed by the Ministry of Property of Russia in accordance with Decree of the Government of the Russian Federation of July 6, 2001 No. 519 “On approval of valuation standards.”

Methodological recommendations can be used to evaluate land plots (valuation objects) that have not been withdrawn from circulation, which are formed (or can be formed) in accordance with the law (hereinafter referred to as “land plots”).

II. Methodological basis for assessing the market value of land plots

Market value is given to those land plots that are capable of satisfying the needs of the user (potential user) for a certain time (the principle of utility).

The market value of a land plot depends on supply and demand in the market and the nature of competition between sellers and buyers (the principle of supply and demand).

The market value of a land plot cannot exceed the most probable costs of acquiring an object of equivalent utility (substitution principle).

The market value of a land plot depends on the expected value, duration and probability of receiving income from the land plot over a certain period of time with its most efficient use, without taking into account income from other factors of production attracted to the land plot for business activities (hereinafter, for the purposes of these recommendations, land rent ) (expectation principle).

The market value of a land plot changes over time and is determined on a specific date (principle of change).

The market value of a land plot depends on changes in its intended purpose, permitted use, the rights of other persons to the land plot, and the division of property rights to the land plot.

The market value of a land plot depends on its location and the influence of external factors (the principle of external influence).

The market value of a land plot is determined based on its most effective use, that is, the most likely use of the land plot, which is physically possible, economically justified, meets legal requirements, is financially feasible and as a result of which the estimated value of the land plot will be maximum (the principle of the most effective use) . The most effective use of a land plot is determined taking into account its possible justified division into separate parts that differ in shape, type and nature of use. The best use may not be the current use of the land.

When determining the most effective use, the following are taken into account:

  • intended purpose and permitted use;
  • the prevailing land use methods in the immediate vicinity of the assessed land plot;
  • prospects for the development of the area in which the land plot is located;
  • expected changes in the land and other real estate market;
  • current use of the land.

It is recommended to assess the market value of land plots in accordance with the methodological principles given above.

The date of assessing the value of a land plot, as a rule, should not be later than the date of its last inspection by the appraiser.

When making an assessment, the appraiser is obliged to use information that ensures the reliability of the assessment report as a document containing information of evidentiary value. The volume of information used in the assessment, the choice of sources of information and the procedure for using information are determined by the appraiser. When determining the market value of land plots, information obtained during the state cadastral valuation can be used. (as amended by the order of the Ministry of Property of the Russian Federation dated July 31, 2002 N 2314-r) (see text in the previous edition)

The results of the assessment must be documented in a written assessment report.

The appraisal report may contain appendices, the composition of which is determined by the appraiser, taking into account the requirements stipulated by the terms of the appraisal agreement.

All materials in the assessment report must be aimed at justifying the market value of the land plot. The inclusion in the appraisal report of materials and information not related to the determination of market value should be avoided.

It is recommended to include in the report on the assessment of the market value of a land plot:

  • description of the land plot, including the intended purpose and permitted use of the land plot, the rights of other persons to the land plot, division of property rights to the land plot;
  • description of buildings, structures, structures, engineering infrastructure facilities located within the land plot, as well as the results of work and anthropogenic impacts that change the qualitative characteristics of the land plot (hereinafter referred to as land plot improvements);
  • photographs of the land and its improvements;
  • characterization of the state of the land and real estate market;
  • establishing the option for the most effective use of the land plot.

The final value of the market value of a land plot must be expressed in rubles as a single value, unless otherwise provided in the valuation agreement (for example, the valuation agreement may stipulate that the final value of the land plot is expressed as a range of values).

IV. Assessment methods

When conducting an assessment, the appraiser is obliged to use (or justify the refusal to use) cost, comparative and income approaches to assessment. The appraiser has the right to independently determine specific assessment methods within each assessment approach. This takes into account the volume and reliability of market information available for use of a particular method.

As a rule, when assessing the market value of land plots, the sales comparison method, the allocation method, the distribution method, the land rent capitalization method, the residual method, and the intended use method are used.

The comparative approach is based on the sales comparison method, the allocation method, and the distribution method. The income approach is based on the method of capitalization of ground rent, the residual method, and the method of intended use. Elements of the cost approach in terms of calculating the cost of reproduction or replacement of land improvements are used in the residual method and the allocation method.

The following is the content of the listed methods in relation to assessing the market value of land plots occupied by buildings, structures, structures or intended for their placement, as well as the features of assessing the market value of agricultural land.

If other methods are used in the assessment report, it is advisable to disclose their content and justify their use.

1. Sales comparison method

The method is used to evaluate land plots, both occupied by buildings, structures and (or) structures (hereinafter - developed land plots), and land plots not occupied by buildings, structures and (or) structures (hereinafter - undeveloped land plots). The condition for applying the method is the availability of information on the prices of transactions with land plots that are analogues of the property being valued. In the absence of information on the prices of transactions with land plots, it is allowed to use supply (demand) prices.

  • determination of the elements by which the evaluation object is compared with analogous objects (hereinafter referred to as the elements of comparison);
  • determination for each element of comparison of the nature and degree of differences between each analogue and the land plot being assessed;
  • determination for each of the comparison elements of price adjustments of analogues corresponding to the nature and degree of differences of each analogue from the assessed land plot;
  • adjustment for each element of price comparison of each analogue, smoothing out their differences from the assessed land plot;
  • calculation of the market value of a land plot through a reasonable generalization of adjusted prices of analogues.

The elements of comparison include the factors of value of the property being assessed (factors whose changes affect the market value of the property being assessed) and the characteristics of transactions with land plots that have developed in the market.

The most important cost factors tend to be:

  • location and environment;
  • intended purpose, permitted use, rights of other persons to the land plot;
  • physical characteristics (relief, area, configuration, etc.);
  • transport accessibility;
  • infrastructure (presence or proximity of utility networks and conditions for connecting to them, social infrastructure facilities, etc.).

The characteristics of land transactions include, among other things:

  • conditions for financing transactions with land plots (ratio of own and borrowed funds, conditions for the provision of borrowed funds);
  • terms of payment when making transactions with land plots (payment in cash, settlement by bills, offsets, barter, etc.);
  • circumstances of the transaction with land plots (whether the land plot was presented to the open market in the form of a public offer, affiliation of the buyer and seller, sale under bankruptcy conditions, etc.);
  • changes in prices for land plots for the period from the date of conclusion of a transaction with an analogue to the date of assessment.

The nature and degree of differences between the analogue and the assessed land plot are established in the context of the elements of comparison by direct comparison of each analogue with the object of assessment. In this case, it is assumed that the transaction with the object of assessment will be made based on the characteristics of transactions with land plots that have developed in the market.

Adjustments to the prices of analogues by comparison elements can be determined both for the price of a unit of measurement of the analogue (for example, a hectare, square meter) and for the price of the analogue as a whole. Price adjustments can be calculated in monetary or percentage terms.

The magnitude of price adjustments is typically determined in the following ways:

  • direct pairwise comparison of prices of analogues that differ from each other only in one element of comparison, and determination, based on the information thus obtained, of adjustments for this element of comparison;
  • direct pairwise comparison of the income of two analogues, differing from each other only in one element of comparison, and determining, by capitalizing the difference in income, adjustments for this element of comparison;
  • correlation-regression analysis of the connection between changes in the comparison element and changes in prices of analogues (prices of units of measurement of analogues) and determination of the equation for the relationship between the value of the comparison element and the market value of the land plot;
  • determining the costs associated with changing the characteristics of a comparison element in which the analogue differs from the object of evaluation;
  • expert justification for price adjustments of analogues.

As a result of determining and making adjustments, prices of analogues (units of measurement of analogues), as a rule, should be close to each other. In case of significant differences in the adjusted prices of analogues, it is advisable to choose other analogues; elements for which comparison is made; adjustment values.

2. Isolation method

Conditions for using the method:

The method involves the following sequence of actions:

  • calculation of the replacement cost or cost of reproduction of improvements to the assessed land plot;
  • calculating the market value of the assessed land plot by subtracting from the market value of a single real estate object, including the assessed land plot, the cost of replacement or the cost of reproducing improvements to the land plot.

The amount of costs for creating improvements to a land plot can be determined using aggregated and (or) elemental cost indicators.

Integrated cost indicators include both indicators characterizing the parameters of the object as a whole - square, cubic, linear meter, and indicators for complexes and types of work.

Elemental cost indicators include elemental prices and rates used in determining the amount of costs for creating improvements.

Aggregated and elemental cost indicators calculated at the price level fixed for a specific date (basic price level) can be recalculated into the price level as of the valuation date using a system of current and forecast indices of changes in construction costs.

Calculation of the amount of costs for creating improvements using elemental cost indicators can also be carried out using resource and resource-index methods. The resource (resource-index) method consists of calculating in current (forecast) prices and tariffs all resources (cost elements) necessary to create improvements.

When determining the amount of costs for creating improvements to a land plot, one should take into account the investor’s profit - the amount of the most likely reward for investing capital in creating improvements. The investor's profit can be calculated as the difference between the sale price and the costs of creating similar objects. The investor's profit can also be calculated as the return on capital for his most likely investment with a similar level of risk.

When determining replacement cost or reproduction cost, the amount of accumulated depreciation of improvements is taken into account.

Accumulated depreciation of improvements may be determined in total or in monetary terms as the sum of the physical, functional, and portion of economic depreciation attributable to the improvements.

Physical depreciation is the loss of value of improvements due to deterioration of their physical properties.

Functional wear and tear is the loss of value of improvements due to the inconsistency of the space-planning solution, building materials and engineering equipment of improvements, the quality of construction work performed or other characteristics of improvements with modern market requirements for this type of improvement.

Economic depreciation is the loss of value of a single property caused by the negative impact of factors external to it.

Physical and functional wear and tear can be removable or irreparable. Economic wear and tear is usually irreparable. In this case, wear and tear is removable if the cost of its elimination is less than the increase in the value of the property as a result of its elimination.

3. Distribution method

The method is used to evaluate built-up land plots.

Conditions for using the method:

  • availability of information on the prices of transactions with single real estate objects, similar to a single real estate object, which includes the land plot being assessed. In the absence of information on transaction prices, it is permissible to use supply (demand) prices;
  • availability of information on the most probable share of a land plot in the market value of a single property;
  • correspondence of land improvements to its most effective use.

The method involves the following sequence of actions:

  • determination of the elements by which a single real estate object, including the assessed land plot, is compared with analogous objects;
  • determination for each of the elements of comparison of the nature and degree of differences of each analogue from a single real estate object, including the assessed land plot;
  • determination for each of the comparison elements of price adjustments of analogues, corresponding to the nature and degree of differences of each analogue from a single real estate object, including the land plot being assessed;
  • adjustment for each of the elements of price comparison of each analogue, smoothing out their differences from a single real estate object, which includes the land plot being assessed;
  • calculation of the market value of a single property, including the assessed land plot, by means of a reasonable generalization of the adjusted prices of analogues;
  • calculation of the market value of the assessed land plot by multiplying the market value of a single real estate object, which includes the assessed land plot, by the most probable value of the share of the land plot in the market value of a single real estate object.

4. Method of capitalization of ground rent

The method is used to evaluate built-up and undeveloped land plots. The condition for applying the method is the possibility of obtaining land rent from the land plot being assessed.

The method involves the following sequence of actions:

  • calculation of land rent created by a land plot;
  • determining the value of the corresponding land rent capitalization coefficient;

Capitalization of ground rent is understood as the determination, on the date of the valuation, of all future values ​​of ground rent that are equal to each other or changing at the same rate for equal periods of time. The calculation is made by dividing the value of land rent for the first period after the date of assessment by the corresponding capitalization coefficient determined by the appraiser.

Within the framework of this method, the value of land rent can be calculated as income from leasing a land plot under the conditions prevailing in the land market.

The main ways to determine the capitalization ratio are:

  • dividing the value of land rent for similar land plots by their selling price;
  • an increase in the risk-free rate of return on capital by the amount of the premium for the risk associated with investing capital in the assessed land plot.

In this case, the risk-free rate of return on capital is understood as the rate of return for the least risky investment of capital (for example, the rate of return on deposits of banks of the highest category of reliability or the rate of return to maturity on government securities).

5. Remainder method

The method is used to evaluate built-up and undeveloped land plots. The condition for applying the method is the possibility of developing the assessed land plot with improvements that generate income.

The method involves the following sequence of actions:

  • calculation of net operating income attributable to improvements for a certain period of time as the product of the cost of reproduction or replacement of improvements by the corresponding capitalization ratio of income from improvements;
  • calculation of the amount of ground rent as the difference between the net operating income from a single property for a certain period of time and the net operating income attributable to improvements for the corresponding period of time;
  • calculation of the market value of a land plot by capitalizing land rent.

The method also allows the following sequence of actions:

  • calculation of the cost of reproduction or replacement of improvements corresponding to the most efficient use of the assessed land plot;
  • calculation of net operating income from a single property for a certain period of time based on market rental rates;
  • calculating the market value of a single property by capitalizing net operating income for a certain period of time;
  • calculating the market value of a land plot by subtracting the cost of reproduction or replacement of improvements from the market value of a single piece of real estate.

Net operating income is equal to the difference between actual gross income and operating expenses. In this case, only those operating expenses that, as a rule, are borne by the lessor are deducted from the actual gross income.

Actual gross income is equal to the difference between potential gross income and losses from idle premises and losses from non-payment of rent.

Potential gross income is equal to the income that can be received from renting out the entire area of ​​a single real estate property in the absence of losses from non-payment of rent. When assessing a land plot, rental rates for the use of a single property are calculated on the basis of market rental rates (the most probable rental rates at which the property being assessed can be leased on the open market in a competitive environment, when the parties to the transaction act reasonably, having all the necessary information, and the rental rate does not reflect any extraordinary circumstances).

For premises that are empty and used by the owner for his own needs, market rental rates are also used. Potential income includes other income derived from permanent improvements to the property but is not included in the rent.

The amount of operating expenses is determined based on market conditions for leasing single real estate objects. Operating expenses are divided into: constant - independent of the occupancy level of a single property, variable - dependent on the occupancy level of a single property and costs for replacing elements of improvements with a useful life less than the period of use of the improvements as a whole (hereinafter referred to as elements with a short useful life ). Operating expenses do not include depreciation charges on real estate and expenses for servicing debt obligations on real estate.

The cost of replacing improvement elements with a short lifespan is calculated by dividing the amount of costs for creating these improvement elements by the period of their use. In the process of performing these calculations, it is advisable to take into account the possibility of a percentage increase in funds to replace elements with a short service life.

Management expenses are included in operating expenses regardless of who manages the property - the owner or the manager.

When calculating the capitalization rate for land improvements, you should take into account the most likely rate of change in income from improvements and the most likely change in the cost of improvements (for example, when the cost of improvements decreases, take into account the return on capital invested in improvements).

6. Method of intended use

The method is used to evaluate built-up and undeveloped land plots.

The condition for applying the method is the possibility of using the land in a way that generates income.

The method involves the following sequence of actions:

  • determination of the amount and time structure of expenses necessary for the use of a land plot in accordance with its most effective use option (for example, the costs of creating improvements to a land plot or the costs of dividing a land plot into separate parts that differ in shape, type and nature of use);
  • determining the amount and time structure of income from the most efficient use of the land;
  • determining the amount and time structure of operating expenses necessary to generate income from the most efficient use of the land;
  • determining the value of the discount rate corresponding to the level of risk of investing capital in the assessed land plot;
  • calculating the value of a land plot by discounting all income and expenses associated with the use of the land plot.

In this case, discounting is understood as the process of bringing all future income and expenses to the date of assessment at a discount rate determined by the appraiser.

To bring all future income and expenses to the date of assessment, discount rates are used, obtained based on an analysis of the rates of return on capital of investments with similar risk levels.

The source of income can be the rental, economic use of a land plot or a single piece of real estate, or the sale of a land plot or a single piece of real estate in the most likely time frame at market value.

Calculation of income in the option of renting out real estate should include taking into account income from the sale of a single property at the end of the forecast period.

V. Features of assessing the market value of agricultural land

The assessment of agricultural land plots is carried out based on their permitted, sustainable and most effective use, taking into account the characteristics of the agricultural zoning of the territory.

To carry out an assessment within the boundaries of an agricultural land plot in accordance with its explication, the following are distinguished:

  • agricultural land (arable land, hayfields, pastures, fallow land and perennial plantings);
  • lands occupied by buildings, structures, structures used for production, storage and primary processing of agricultural products;
  • lands occupied by on-farm roads, communications, trees and shrubs intended to protect lands from the effects of negative (harmful) natural, anthropogenic and man-made phenomena, closed reservoirs.

The market value of an agricultural land plot is determined on the basis of the assessment of the agricultural land included in its composition and the land occupied by buildings, structures, structures used for the production, storage and primary processing of agricultural products. At the same time, the market value of the assessed land plot is determined taking into account the characteristics of the lands included in its composition, occupied by on-farm roads, communications, trees and shrubs, intended to ensure the protection of lands from the effects of adverse natural, anthropogenic and man-made phenomena, closed reservoirs that cannot be used for business activities.

Agricultural land and enclosed bodies of water that can be used for business activities (for example, fishing) are usually valued using the sales comparison method or the rent capitalization method.

Land occupied by buildings, structures, structures used for the production, storage and primary processing of agricultural products are assessed by methods of assessing built-up or intended for development of land plots. Land under outbuildings (sheds and other non-permanent buildings) located on agricultural land is assessed as agricultural land.

When assessing the market value of agricultural land using the sales comparison method and the land rent capitalization method, the fertility of the land plot, as well as the influence of environmental factors, should be taken into account as part of the cost factors. The main factors determining the fertility of a land plot, in particular, include: qualitative characteristics of the soil layer of the land plot (nutrient content, moisture supply, aeration, mechanical composition, structural composition, acidity, etc.), relief, microclimate.

When assessing the market value of agricultural land using the method of capitalization of land rent, there are features of calculating land rent associated with the adopted system for accounting for the fertility of a land plot.

Land rent is calculated as the difference between gross income and the costs of agricultural production, taking into account the profit of the entrepreneur. Gross income is calculated for a unit of land area as the product of the standard yield of an agricultural crop and its market price.

The standard yield of an agricultural crop is determined by the fertility of the land plot, measured in quality points.

The selection of the main and associated agricultural crops for which land rent is calculated is carried out from a set of crops typical or traditionally cultivated at the location of the land plot. At the same time, the criteria for choosing crops and their rotation are to ensure the greatest income and maintain soil fertility.

Material costs for the production of agricultural products are determined on the basis of technological maps that establish standard costs of seeds, fuels and lubricants, fertilizers, etc. in kind.

Costs in monetary terms are calculated based on market prices prevailing in the area where the land plot is located.

When calculating costs, the level of engineering development of the land plot is taken into account, including the density of the road network, the class of roads, proximity to transport routes, points of processing of agricultural raw materials and material and technical supply centers.

When calculating gross income from arable land, the possibility of obtaining several harvests during one season for vegetable products and medicinal plant products can be taken into account.

The deposit is assessed by the method of intended use, taking into account the economic feasibility of its transfer to another type (types) of agricultural land.

When calculating the gross income of hayfields and pastures, one should proceed from their standard yield. The standard yield of hayfields and pastures is determined by its conversion into centners of feed units (1 centner of feed units equals 1 centner of oats). In this case, the amount of gross income is determined on the basis of the market price of oats.

When calculating the gross income of perennial plantings, it is recommended to proceed from the frequency of their fruiting and the standard yield of fruit and berry products. This takes into account:

  • age of perennial plantings;
  • species-varietal composition of perennial plantings;
  • features of the spatial placement of perennial plantings within the boundaries of the land plot;
  • the possibility of generating income from additional products obtained from the rows of orchards and vineyards.

Market value is the price agreed upon by all parties to a transaction carried out in a competitive free market. This price is not influenced by significant circumstances, and the process of its installation is permitted on a mandatory and voluntary basis.

Market value assessment

With the help of establishing the market value of any property. In a broad sense, this process is an assessment of property rights, taking into account any existing restrictions. Carried out by relevant organizations, and the order of activity is determined Federal Law No. 135-FZ “On appraisal activities in the Russian Federation.”

Mandatory assessment is required in cases established by law, namely the alienation of real estate owned (in whole or in part) by the Russian Federation, any subject of the federation or a municipal institution.

According to the Civil Code, real estate is considered to be land plots, as well as objects the transfer of which is possible, but would cause irreparable damage to their intended purpose. For example:

  • buildings;
  • plots of land;
  • space objects, etc.
Factors that influence the determination of cost:
  • location;
  • date of construction (if available);
  • specifications;
  • infrastructure;
  • traffic movement, etc.
An assessment made by an independent expert helps to obtain reliable information about the property and set an appropriate price for it. Most often this is necessary when:
  • revaluation of assets;
  • issue of securities;
  • registration of a mortgage;
  • carrying out various types of transactions (purchase and sale, donation, etc.);
  • privatization, as well as many other situations.
The assessment is mainly made by:
  • Appraisal Bureau. Currently, there are many commercial firms that carry out a variety of valuation activities, but do not provide legal services. The main condition is the presence of such an office as part of a self-regulatory organization.
  • Real estate agency. Many large real estate agencies have expert appraisers on their staff. If a plot of land is being sold through a real estate agency, these employees will be able to help and conduct an assessment.
  • Law firm. Most of these firms, in addition to legal assistance, provide certain services related to examination and assessment.
  • Private appraiser. The law does not prohibit the provision of private appraisal activities. Such an expert uses identical assessment methods as employees of the above-mentioned companies. As in other cases, such an appraiser acts in accordance with the laws of the Russian Federation.

Assessment methods

The main methods of assessment are the following methods:
  • sales comparisons;
  • distribution;
  • discharge;
  • capitalization of land rent;
  • remainder for land;
  • possible use.
All of these methods follow certain formulas for calculating value, the processes that occur during the assessment, as well as the conditions under which one or another method should be used for the final assessment. It is impossible to describe them all due to the huge abundance of information regarding each method.

Calculation of market value

Let's consider an example of calculation for land real estate using extraction method, since this is the method most often used by professional appraisers.

The main indicator in this example is a plot of land and the building located within it (850 sq.m.). Let's assume that the site is under a building. Price per 1 sq.m. buildings is equal to 25,000 rubles.

To find out the market value using this method, you need to calculate it using this formula:

A1? A2 = B1, where

  • A1 – building area;
  • A2 – price for 1 unit. squares;
  • B1 – final cost.
We get:

850 ? 25 000 = 21 250 000.

Market research has shown that the cost of constructing the building is 32,500 rubles. The wear percentage, let's say, is 0.75%. Next you need to find out the market cost of building construction:

850 ? 25 000 ? 0,75 = 15 937 500.

At the end, you can find out the cost of the site itself. It amounts to:

21,250,000 – 15,937,500 = 5,312,500 rubles.

Cadastral and market value

The cadastral value is assigned by the Government of the Russian Federation. And the market one depends on a variety of factors, most of which are not taken into account at all during the cadastral valuation. This is the main difference between the two types of cost. Others differences the following may occur:
  • when compiling the cadastral value, season, demand and the general state of the market do not matter;
  • the cadastral value is assigned through material analysis, and the market value through competitiveness, various offers, etc.;
  • The cadastral value can sometimes be too high, due to factors such as the solvency of the population, the location of the property, etc. are not taken into account.

Sometimes it may happen that due to the presence of nearby infrastructure, the cost will be greatly inflated, although de facto these buildings do not affect the increase in cost.


The differences between these two types of value play a significant role in taxation (Article 65 of the Land Code of the Russian Federation). However, the inflated cadastral value is sometimes an unbearable burden for the population, since in most situations it greatly exceeds the market value. About methods for calculating cadastral value -.

Procedure for assessing market value

Market value assessment occurs in 5 stages:

1. The first step is conclusion of an agreement for carrying out assessment activities. Here the expert sets the necessary evaluation parameters:

  • purpose of the assessment;
  • legal side of the process;
  • category of land;
  • type of property;
  • easements;
  • assessment date;
  • drawing up an assessment agreement, etc.
2. Collection and analysis of received information. The appraiser collects data about the property, studies various characteristics of the site, and analyzes various factors that directly affect the value of the land:
  • buildings in surrounding areas;
  • presence of a green zone (condition, type, etc.);
  • general state of the environment;
  • negative impact of various factors;
  • data on costs and profits from the use of the site.
Also attached to the report is a map of the area where the site is located and its location, including photographs of the property.

3. Selecting the appropriate assessment method, performing the necessary calculations. Each method will result in a different cost of land. Subsequently, the appraiser will conduct a comparative analysis, thanks to which it will be possible to see the pros and cons of each method.


4. Assignment of final cost for a plot of land. It will be indicated in rubles (unless otherwise specified in the contract).

5. Compilation of a report. The final assessment results will be presented in writing. The assessment report is an evidentiary document intended for those interested in the results (as well as the customer himself). Inside the report there is a final conclusion and the final market value.

An example of a report on determining the market value of a land plot in .pdf format (Adobe Reader)

Agricultural land

For each type and category of land, different factors are taken into account when assessing. Let us consider the main points by which the market value of a plot of land is determined using the example of agricultural land.

The significance of such objects is determined by the possible purpose and fertility of the land. Important factors are: relief, soil characteristics, water component (if available). For evaluation, the approach that has the best economic effect is usually selected.

If there is arable land, it can be used for pasturing livestock or as arable land. In this case, the latter option is much more profitable in economic terms. Therefore, when assessing, it is necessary to proceed from it.


When determining soil fertility indicators, experts often use grading. This is the name of the assessment, which is calculated by comparing fertility under identical climatic and agronomic conditions. This process itself is extremely difficult, therefore, when assessing agricultural land, appraisers use ready-made valuation indicators.

After studying all aspects and determining how the land will be used, the expert creates a revenue model. It takes into account the costs and profits of the owner for a certain time period. The positive difference regarding income and expenses is discounted into current indicators, on the basis of which this price will be considered the market value.

Determining market value, in some situations, is a rather labor-intensive process, but very important. If the cadastral value puts you into tax debt, it would be a good idea to conduct an additional assessment of the market value and demand a recalculation in court. And if necessary, companies dealing with this issue will help you with the assessment itself.

How is the market value of a land plot determined? How much does one hundred square meters of land cost? Is it possible to find out the market value of land by cadastral number?

When selling any product or service, we charge what we consider to be a fair price. To do this, we find similar advertisements and compare them with ours. However, this is not always possible. Especially for atypical objects for sale, for example, for some land plots.

My name is Valery Chemakin. As a legal consultant, in this article I will talk about the market value of a land plot.

I will also talk about where and how to order an assessment of the market value of land.

1. What is the market value of a land plot and why you need to know it

In conditions of free commercial circulation of land, prices for plots are determined by the market. Most often, objects of the same type in a particular area cost approximately the same. This happens because the market is capable of self-regulation, despite the apparent chaos.

Based on what has been said, let us formulate a definition.

This is the price at which it can be sold within a reasonable time on the free market with mutual satisfaction with the results of the transaction on both sides.

Where can I find out the market value of a land plot? In most cases, the answer to this question is obvious. It is enough to open any website with advertisements and study the offers in the area where the land is located. However, if there is not a single similar plot for sale, you will have to resort to the help of appraisers.

If you need an official expert opinion, for example, for a court, an independent one is also carried out. Read our special article about the essence of this concept. Experts use various valuation methods to determine the market value of a site, depending on the purpose of the land.

For example, for an agricultural land plot, the formula uses the factor of potential profit from farming or commodity production. Calculating the market value of an industrial land plot also takes into account potential income, but from other economic activities.

2. How much does one hundred square meters of land cost - an overview of the main factors influencing the market value of a plot

Without going deeply into the procedure for assessing the market value of a land plot, I will note that there are dozens of factors influencing its formation.

Here are the main ones.

Factor 1. Site location

This is the most important factor, since it is it that has a decisive influence on price formation. The closer the land is to large cities, the more expensive it is.

Example

I recently sold a plot of 17 acres in a rural area with communications, but 200 km from the nearest large city for only 100 thousand rubles. Immediately after this, he acquired 20 acres of land within Tyumen, although without communications, but for 1.5 million rubles.

These are pennies compared to the price of land in the elite suburbs of Moscow. Even within the boundaries of the same cadastral region, the price of plots of the same area differs quite significantly, despite the similarity. This depends on individual circumstances, as outlined in the next subsection.

Factor 2. Soil condition and terrain

People purchase land plots not just to build a house, but for further active recreation. Therefore, the site should please a person with its appearance, proximity to a forest, river or lake, and soil fertility. Gullies, ditches and other undesirable landforms greatly reduce the cost, as does marshy or salty soil.

Factor 3. Presence of buildings on the site and their condition

The market value of land plots with a residential building is much higher. After all, it also includes the price of the building itself, even if it is an old dilapidated house that will have to be demolished. However, the condition of the buildings also matters. Obviously, a plot with a cottage is much more valuable than a plot with a barn.

Factor 4. Connectivity to communication networks

Municipalities often finance the construction of utility lines on sites for individual housing construction (IHC). Electricity, gas and water supply greatly increase the cost of land.

Example

The plot of land I purchased does not have communications or even access roads, so it costs 1.5 million rubles. Similar land in the nearest inhabited village costs at least 3 million rubles. This means I have a chance to make a good profit after installing the utility networks.

Factor 5. Probability of making a profit over a certain period from using the site

Land for agricultural purposes or for the construction of industrial facilities is intended for the production of material goods, which means they are capable of generating profit. Areas near federal highways are especially valuable. This potential income is also included in the market value of such plots.

3. Who is responsible for determining the market value of land - an overview of the main options for appraisers

For any legally significant actions, it is not enough to simply know the price of your plot. It is necessary to obtain an official opinion from professional appraisers, drawn up in accordance with the law on valuation activities.

Let's look at who sets the market value of a land plot, how it is determined and where to go for this.

Option 1. Specialized appraisal bureau

Today there are many commercial firms engaged in various types of appraisal activities. A prerequisite is that they must be members of self-regulatory organizations (SROs). These firms only perform appraisals, but do not provide other services, such as legal ones.

Option 2. Independent private appraiser

The law does not prohibit engaging in individual appraisal activities, so you can also find a private appraiser. He uses the same valuation principles in determining the market value of a plot of land as an employee of any company. A private appraiser is subject to the same law on valuation activities.

Option 3. Real estate agency

Any large real estate agency has appraisers on its staff. Therefore, if you decide to sell a plot of land through a real estate agency and do not know what price to set, they are at your service. This is very convenient, since their work will be paid from commissions.

Option 4. Law firm

Many law firms do not limit themselves to providing legal assistance to clients. They offer examination and valuation services. It is advisable to contact such offices when you need not only to find out the cost of the property, but also to receive legal assistance. For example, the court requires the division of property with your ex-spouse, but you do not agree with his assessment.

It is especially common to go to court to reduce the cadastral value in order to pay less tax. To do this, a challenge procedure is carried out after, but you’d better read about this in our special article.

4. How to find out the market value of a land plot - step-by-step instructions

If you don’t know how the market value of a land plot is calculated, but you just need it for reference, and not to perform legally significant actions, then use one trick. Now the state is trying to bring the cadastral value closer to the market value in order to collect more taxes. Information on cadastral value is available in the Rosreestr database.

Therefore, calculate online the approximate market value of a land plot using its cadastral number. To do this, visit the website of Rosreestr or any intermediary company and enter the number in a special search form. Instead of a cadastral number, it is allowed to enter an address, but only if it already officially exists.

When you need official paper about the market value of a land plot, for example, to register a lease, then contact professional appraisers. How to do this - read on.

Step 1. Select an appraisal company

Depending on the volume and complexity of the work, choose an independent appraiser or contact an appraisal company. To choose the right company, first make inquiries about all those available in your area.

Ask your acquaintances, friends and neighbors. Suddenly someone recently used the services of an appraiser. Read the forums. As a result, you need to choose the company that is optimal in terms of cost and quality of services provided.

Step 2. Determine a number of questions for the expert

Before concluding a contract, you need to decide on the questions you want to ask the expert. It is recommended to immediately settle all the nuances with him.

Questions to the expert:

  • will he visit the site or conduct an assessment based on documents;
  • what is included in the cost of services;
  • what method will he use to evaluate the site;
  • how long it will take him to work.

Don't forget to look at his example of assessing the market value of a land plot. Looking at it, you will understand how responsibly and accurately the appraiser works and whether the report form meets the requirements.

Step 3. Provide the necessary documentation

To carry out the work, the appraiser will need technical documentation for the site, as well as documents confirming your ownership.

If you don’t have something, you can always order what you’re missing on the Unified State Register 365 website. Just go to this portal and you’ll see what documents they prepare. There, in the search form, enter the cadastral number of the plot and receive information from the Unified State Register of Real Estate (USRN). It's free.

If you need an official cadastral certificate, an extract from the Unified State Register of Real Estate or technical documentation for the site - pay the money and they will deliver it all to you by courier. Official certificates and other documents have the seals of Rosreestr. If printing is not needed, then the cost of the service is much lower.

Step 4. Pay for the service and conclude an agreement

After all the documents are ready, enter into an agreement and pay for the service. Be sure to read the terms of the contract carefully. It must specify the appraiser's responsibility for problems arising through his fault due to an incorrect assessment of the market value of the land plot.

Step 5. Agree on the date and time of the assessment

Since most often in order to carry out a competent and correct assessment it is necessary to examine the site itself, agree in advance with the specialist on the time and date of this event. After all, only after it has been completed will he be able to proceed directly to the calculations. By the way, ask in advance whether his visit is included in the cost of the entire service. If not, then find out whether you need to pay right away or later.

Step 6. Wait for the specialist to arrive

On the appointed day and time, meet the specialist and take him to the site. Stay nearby during the inspection. There may be some clarifying questions regarding the individual characteristics of the site. This may be the quality of the soil, the degree of flooding in the spring, the presence of other hidden factors that you consider necessary to take into account.

Step 7

The report on the assessment of the market value of a land plot contains information about the owner of the property and the appraiser. An important component of the report is a description of the methodology and its legal basis.

For example, the use of the mass valuation method in determining the market value of land plots is permissible only in relation to standard land for construction within the boundaries of populated areas.

Completely different methods are used to establish the market value of forest land, agricultural land, land for industrial facilities, as well as any atypical land plots. Any report ends with a conclusion indicating the market value.

If you would like to consult on these or other legal issues in more detail, please visit the website of the Pravoved company. There you will find a convenient feedback form through which you can ask a lawyer a question.

State your problem briefly and clearly. As a result, you will receive a comprehensive answer with a specific algorithm of actions to solve the problem. The cost of such an online consultation is less than 1000 rubles.

5. Professional assistance in determining the market value of a land plot - review of the TOP-3 appraisal companies

When contacting an appraisal company, we must be confident in the professionalism of the specialists. Besides, we don't want to overpay.

Below I offer an overview of 3 well-known appraisal companies where ordering an assessment of the market value of a land plot will not cost much.

This company provides real estate valuations for banks. If you want to get a loan secured by your plot, and the cadastral value is too low, contact the Yurdis company. It works with most large Russian banks. They trust her, so be sure that your site will be assessed adequately and you will receive the loan you want.

Here you can order the one you want to use as collateral. The company's appraisers are ready to calculate the liquidation value of the property, which is 20% lower than the market value. It is needed for a quick sale. Such services cost only 4 thousand rubles, which is much lower than competitors.

The company provides all types of appraisal services. Land plots are assessed in three different ways, in agreement with the customer: with or without inspection of the object, by issuing an expert opinion on the value of the land without appraisal actions.

What are the advantages of Consult Pro Assessment:

№ AdvantageBenefit
1 Legal forceThe report will be accepted in any court, bank and government agency
2 Knowledge of Moscow market conditionsThey take into account the prestige of the area, building density, environmental factors
3 CredibilityAchieved through a thorough analysis of the market situation at a specific point in time
4 ConvenienceThe service can be ordered through the website, all customer wishes are taken into account
5 EfficiencyAll work is completed in the shortest possible time

On the company’s website it is proposed to create a personal account through which it is very convenient to monitor the implementation of land valuation services. It’s also easy to track your order history there. All reports fully comply with the law, which guarantees their acceptance by banks, courts and government agencies. Specialists carry out calculations using special programs, which reduces the likelihood of errors to a minimum.

The site even has an online calculator with which you can evaluate some objects for free. Appraisers work at any time and are ready to fulfill urgent orders even on weekends. The company offers special, more favorable terms of cooperation to regular customers.

I. General provisions These methodological recommendations for determining the market value of land plots were developed by the Ministry of Property of Russia in accordance with the Decree of the Government of the Russian Federation of July 6, 2001 No. 519 “On approval of valuation standards.” Methodological recommendations can be used to evaluate land plots (valuation objects) that have not been withdrawn from circulation, which have been formed (or can be formed) in accordance with the law. (hereinafter referred to as “land plots”) II. Methodological basis for assessing the market value of land plots Market value are those land plots that are able to satisfy the needs of the user (potential user) for a certain time (the principle of utility). The market value of a land plot depends on supply and demand in the market and the nature of competition between sellers and buyers (the principle of supply and demand). The market value of a land plot cannot exceed the most probable costs of acquiring an object of equivalent utility (substitution principle). The market value of a land plot depends on the expected value, duration and probability of receiving income from the land plot over a certain period of time with its most efficient use, without taking into account income from other factors of production attracted to the land plot for business activities (hereinafter, for the purposes of these recommendations, land rent ) (expectation principle). The market value of a land plot changes over time and is determined on a specific date (principle of change). The market value of a land plot depends on changes in its intended purpose, permitted use, the rights of other persons to the land plot, and the division of property rights to the land plot. The market value of a land plot depends on its location and the influence of external factors (the principle of external influence). The market value of a land plot is determined based on its most effective use, that is, the most likely use of the land plot, which is physically possible, economically justified, meets legal requirements, is financially feasible and as a result of which the estimated value of the land plot will be maximum (the principle of the most effective use) . The most effective use of a land plot is determined taking into account its possible justified division into separate parts that differ in shape, type and nature of use. The best use may not be the current use of the land. When determining the most effective use, the following are taken into account: the intended purpose and permitted use; the prevailing land use methods in the immediate vicinity of the assessed land plot; prospects for the development of the area in which the land plot is located; expected changes in the land and other real estate market; current use of the land. III. General recommendations for conducting assessments It is recommended that the assessment of the market value of land plots be carried out in accordance with the methodological principles given above. The date of assessing the value of a land plot, as a rule, should not be later than the date of its last inspection by the appraiser. When making an assessment, the appraiser is obliged to use information that ensures the reliability of the assessment report as a document containing information of evidentiary value. The volume of information used in the assessment, the choice of sources of information and the procedure for using information are determined by the appraiser. The results of the assessment must be documented in a written assessment report. The appraisal report may contain appendices, the composition of which is determined by the appraiser, taking into account the requirements stipulated by the terms of the appraisal agreement. All materials in the assessment report must be aimed at justifying the market value of the land plot. The inclusion in the appraisal report of materials and information not related to the determination of market value should be avoided. It is recommended to include in the report on the assessment of the market value of a land plot: a description of the land plot, including the intended purpose and permitted use of the land plot, the rights of other persons to the land plot, the division of property rights to the land plot; description of buildings, structures, structures, engineering infrastructure facilities located within the land plot, as well as the results of work and anthropogenic impacts that change the qualitative characteristics of the land plot (hereinafter referred to as land plot improvements); photographs of the land and its improvements; characterization of the state of the land and real estate market; establishing the option for the most effective use of the land plot. The final value of the market value of a land plot must be expressed in rubles as a single value, unless otherwise provided in the valuation agreement (for example, the valuation agreement may stipulate that the final value of the land plot is expressed as a range of values). IV. Valuation methods When conducting an evaluation, the appraiser is obliged to use (or justify the refusal to use) cost, comparative and income approaches to valuation. The appraiser has the right to independently determine specific assessment methods within each assessment approach. This takes into account the volume and reliability of market information available for use of a particular method. As a rule, when assessing the market value of land plots, the sales comparison method, the allocation method, the distribution method, the land rent capitalization method, the residual method, and the intended use method are used. The comparative approach is based on the sales comparison method, the allocation method, and the distribution method. The income approach is based on the method of capitalization of ground rent, the residual method, and the method of intended use. Elements of the cost approach in terms of calculating the cost of reproduction or replacement of land improvements are used in the residual method and the allocation method. The following is the content of the listed methods in relation to assessing the market value of land plots occupied by buildings, structures, structures or intended for their placement, as well as the features of assessing the market value of agricultural land. If other methods are used in the assessment report, it is advisable to disclose their content and justify their use. 1. Sales comparison method The method is used to evaluate land plots, both occupied by buildings, structures and (or) structures (hereinafter - developed land plots), and land plots not occupied by buildings, structures and (or) structures (hereinafter - undeveloped land plots). The condition for applying the method is the availability of information on the prices of transactions with land plots that are analogues of the property being valued. In the absence of information on the prices of transactions with land plots, it is allowed to use supply (demand) prices. The method involves the following sequence of actions: determining the elements by which the evaluation object is compared with analogous objects (hereinafter referred to as comparison elements); determination for each element of comparison of the nature and degree of differences between each analogue and the land plot being assessed; determination for each of the comparison elements of price adjustments of analogues corresponding to the nature and degree of differences of each analogue from the assessed land plot; adjustment for each element of price comparison of each analogue, smoothing out their differences from the assessed land plot; calculation of the market value of a land plot through a reasonable generalization of adjusted prices of analogues. The elements of comparison include the factors of value of the subject of assessment (factors, the change of which affects the market value of the subject of assessment) and the characteristics of transactions with land plots that have developed in the market. The most important cost factors tend to be: location and environment; intended purpose, permitted use, rights of other persons to the land plot; physical characteristics (relief, area, configuration, etc.); transport accessibility; infrastructure (presence or proximity of utility networks and conditions for connecting to them, social infrastructure facilities, etc.). The characteristics of transactions with land plots, among other things, include: conditions for financing transactions with land plots (ratio of equity and borrowed funds, conditions for the provision of borrowed funds); terms of payment when making transactions with land plots (payment in cash, settlement by bills, offsets, barter, etc.); circumstances of the transaction with land plots (whether the land plot was presented to the open market in the form of a public offer, affiliation of the buyer and seller, sale under bankruptcy conditions, etc.); changes in prices for land plots for the period from the date of conclusion of a transaction with an analogue to the date of assessment. The nature and degree of differences between the analogue and the assessed land plot are established in the context of the elements of comparison by direct comparison of each analogue with the object of assessment. In this case, it is assumed that the transaction with the object of assessment will be made based on the characteristics of transactions with land plots that have developed in the market. Adjustments to the prices of analogues by comparison elements can be determined both for the price of a unit of measurement of the analogue (for example, a hectare, square meter) and for the price of the analogue as a whole. Price adjustments can be calculated in monetary or percentage terms. The magnitude of price adjustments, as a rule, is determined in the following ways: direct pairwise comparison of prices of analogues that differ from each other only in one element of comparison, and determination, based on the information thus obtained, of adjustments for this element of comparison; direct pairwise comparison of the income of two analogues, differing from each other only in one element of comparison, and determining, by capitalizing the difference in income, adjustments for this element of comparison; correlation and regression analysis of the connection between changes in the comparison element and changes in prices of analogues (prices of units of measurement of analogues) and determination of the equation for the relationship between the value of the comparison element and the market value of the land plot; determining the costs associated with changing the characteristics of a comparison element in which the analogue differs from the object of evaluation; expert justification for price adjustments of analogues. As a result of determining and making adjustments, prices of analogues (units of measurement of analogues), as a rule, should be close to each other. In case of significant differences in the adjusted prices of analogues, it is advisable to choose other analogues; elements for which comparison is made; adjustment values. 2. Allocation method The method is used to evaluate built-up land plots. Conditions for applying the method: availability of information on the prices of transactions with single real estate objects, similar to a single real estate object, which includes the land plot being assessed. In the absence of information on transaction prices, it is permissible to use supply (demand) prices; correspondence of land improvements to its most effective use. The method involves the following sequence of actions: determining the elements by which a single real estate object, including the assessed land plot, is compared with analogous objects; determination for each of the elements of comparison of the nature and degree of differences of each analogue from a single real estate object, including the assessed land plot; determination for each of the comparison elements of price adjustments of analogues, corresponding to the nature and degree of differences of each analogue from a single real estate object, including the land plot being assessed; adjustment for each of the elements of price comparison of each analogue, smoothing out their differences from a single real estate object, which includes the land plot being assessed; calculation of the market value of a single property, including the assessed land plot, by means of a reasonable generalization of the adjusted prices of analogues; calculation of the replacement cost or cost of reproduction of improvements to the assessed land plot; calculating the market value of the assessed land plot by subtracting from the market value of a single real estate object, including the assessed land plot, the cost of replacement or the cost of reproducing improvements to the land plot. The amount of costs for creating improvements to a land plot can be determined using aggregated and (or) elemental cost indicators. Integrated cost indicators include both indicators characterizing the parameters of the object as a whole - square, cubic, linear meter, and indicators for complexes and types of work. Elemental cost indicators include elemental prices and rates used in determining the amount of costs for creating improvements. Aggregated and elemental cost indicators calculated at the price level fixed for a specific date (basic price level) can be recalculated into the price level as of the valuation date using a system of current and forecast indices of changes in construction costs. Calculation of the amount of costs for creating improvements using elemental cost indicators can also be carried out using resource and resource-index methods. The resource (resource-index) method consists of calculating in current (forecast) prices and tariffs all resources (cost elements) necessary to create improvements. When determining the amount of costs for creating improvements to a land plot, one should take into account the investor’s profit - the amount of the most likely reward for investing capital in creating improvements. The investor's profit can be calculated as the difference between the sale price and the costs of creating similar objects. The investor's profit can also be calculated as the return on capital for his most likely investment with a similar level of risk. When determining replacement cost or reproduction cost, the amount of accumulated depreciation of improvements is taken into account. Accumulated depreciation of improvements may be determined in total or in monetary terms as the sum of the physical, functional, and portion of economic depreciation attributable to the improvements. Physical depreciation is the loss of value of improvements due to deterioration of their physical properties. Functional wear and tear is the loss of value of improvements due to the inconsistency of the space-planning solution, building materials and engineering equipment of improvements, the quality of construction work performed or other characteristics of improvements with modern market requirements for this type of improvement. Economic depreciation is the loss of value of a single property caused by the negative impact of factors external to it. Physical and functional wear and tear can be removable or irreparable. Economic wear and tear is usually irreparable. In this case, wear and tear is removable if the cost of its elimination is less than the increase in the value of the property as a result of its elimination. 3. Allocation method The method is used to evaluate developed land plots. Conditions for applying the method: availability of information on the prices of transactions with single real estate objects, similar to a single real estate object, which includes the land plot being assessed. In the absence of information on transaction prices, it is permissible to use supply (demand) prices; availability of information on the most probable share of a land plot in the market value of a single property; correspondence of land improvements to its most effective use. The method involves the following sequence of actions: determining the elements by which a single real estate object, including the assessed land plot, is compared with analogous objects; determination for each of the elements of comparison of the nature and degree of differences of each analogue from a single real estate object, including the assessed land plot; determination for each of the comparison elements of price adjustments of analogues, corresponding to the nature and degree of differences of each analogue from a single real estate object, including the land plot being assessed; adjustment for each of the elements of price comparison of each analogue, smoothing out their differences from a single real estate object, which includes the land plot being assessed; calculation of the market value of a single property, including the assessed land plot, by means of a reasonable generalization of the adjusted prices of analogues; calculation of the market value of the assessed land plot by multiplying the market value of a single real estate object, which includes the assessed land plot, by the most probable value of the share of the land plot in the market value of a single real estate object. 4. Land rent capitalization method The method is used to evaluate built-up and undeveloped land plots. The condition for applying the method is the possibility of obtaining land rent from the land plot being assessed. The method involves the following sequence of actions: calculation of land rent created by the land plot; determining the value of the corresponding land rent capitalization coefficient; calculation of the market value of a land plot by capitalizing land rent. Capitalization of ground rent is understood as the determination, on the date of the valuation, of all future values ​​of ground rent that are equal to each other or changing at the same rate for equal periods of time. The calculation is made by dividing the value of land rent for the first period after the date of assessment by the corresponding capitalization coefficient determined by the appraiser. Within the framework of this method, the value of land rent can be calculated as income from leasing a land plot under the conditions prevailing in the land market. The main ways to determine the capitalization ratio are: dividing the value of land rent for similar land plots by their selling price; an increase in the risk-free rate of return on capital by the amount of the premium for the risk associated with investing capital in the assessed land plot. In this case, the risk-free rate of return on capital is understood as the rate of return for the least risky investment of capital (for example, the rate of return on deposits of banks of the highest category of reliability or the rate of return to maturity on government securities). 5. Residual method The method is used to evaluate built-up and undeveloped land plots. The condition for applying the method is the possibility of developing the assessed land plot with improvements that generate income. The method involves the following sequence of actions: calculating the cost of reproduction or replacement of improvements corresponding to the most efficient use of the assessed land plot; calculation of net operating income from a single property for a certain period of time based on market rental rates; calculation of net operating income attributable to improvements for a certain period of time as the product of the cost of reproduction or replacement of improvements by the corresponding capitalization ratio of income from improvements; calculation of the amount of ground rent as the difference between the net operating income from a single property for a certain period of time and the net operating income attributable to improvements for the corresponding period of time; calculation of the market value of a land plot by capitalizing land rent. The method also allows for the following sequence of actions: calculating the cost of reproduction or replacement of improvements corresponding to the most efficient use of the land plot being assessed; calculation of net operating income from a single property for a certain period of time based on market rental rates; calculating the market value of a single property by capitalizing net operating income for a certain period of time; calculating the market value of a land plot by subtracting the cost of reproduction or replacement of improvements from the market value of a single piece of real estate. Net operating income is equal to the difference between actual gross income and operating expenses. In this case, only those operating expenses that, as a rule, are borne by the lessor are deducted from the actual gross income. Actual gross income is equal to the difference between potential gross income and losses from idle premises and losses from non-payment of rent. Potential gross income is equal to the income that can be received from renting out the entire area of ​​a single real estate property in the absence of losses from non-payment of rent. When assessing a land plot, rental rates for the use of a single property are calculated on the basis of market rental rates (the most probable rental rates at which the property being assessed can be leased on the open market in a competitive environment, when the parties to the transaction act reasonably, having all the necessary information, and the rental rate does not reflect any extraordinary circumstances). For premises that are empty and used by the owner for his own needs, market rental rates are also used. Potential income includes other income derived from permanent improvements to the property but is not included in the rent. The amount of operating expenses is determined based on market conditions for leasing single real estate objects. Operating expenses are divided into: constant - independent of the occupancy level of a single property, variable - dependent on the occupancy level of a single property and costs for replacing elements of improvements with a useful life less than the period of use of the improvements as a whole (hereinafter referred to as elements with a short useful life) . Operating expenses do not include depreciation charges on real estate and expenses for servicing debt obligations on real estate. The cost of replacing improvement elements with a short lifespan is calculated by dividing the amount of costs for creating these improvement elements by the period of their use. In the process of performing these calculations, it is advisable to take into account the possibility of a percentage increase in funds to replace elements with a short service life. Management expenses are included in operating expenses regardless of who manages the property - the owner or the manager. When calculating the capitalization rate for land improvements, you should take into account the most likely rate of change in income from improvements and the most likely change in the cost of improvements (for example, when the cost of improvements decreases, take into account the return on capital invested in improvements). 6. Intended Use Method The method is used to evaluate developed and undeveloped land plots. The condition for applying the method is the possibility of using the land in a way that generates income. The method involves the following sequence of actions: determining the amount and time structure of the costs necessary to use the land plot in accordance with the option for its most effective use (for example, the costs of creating improvements to the land plot or the costs of dividing the land plot into separate parts that differ in shape, type and nature of use); determining the amount and time structure of income from the most efficient use of the land; determining the amount and time structure of operating expenses necessary to generate income from the most efficient use of the land; determining the value of the discount rate corresponding to the level of risk of investing capital in the assessed land plot; calculating the value of a land plot by discounting all income and expenses associated with the use of the land plot. In this case, discounting is understood as the process of bringing all future income and expenses to the date of assessment at a discount rate determined by the appraiser. To bring all future income and expenses to the date of assessment, discount rates are used, obtained based on an analysis of the rates of return on capital of investments with similar risk levels. The source of income can be the rental, economic use of a land plot or a single piece of real estate, or the sale of a land plot or a single piece of real estate in the most likely time frame at market value. Calculation of income in the option of renting out real estate should include taking into account income from the sale of a single property at the end of the forecast period. V. Features of assessing the market value of agricultural land The assessment of agricultural land is carried out based on their permitted, non-exhaustive and most effective use, taking into account the characteristics of the agricultural zoning of the territory. To carry out an assessment within the boundaries of an agricultural land plot, in accordance with its explication, the following are identified: agricultural land (arable land, hayfields, pastures, fallow land and perennial plantings); lands occupied by buildings, structures, structures used for production, storage and primary processing of agricultural products; lands occupied by on-farm roads, communications, trees and shrubs intended to protect lands from the effects of negative (harmful) natural, anthropogenic and man-made phenomena, closed reservoirs. The market value of an agricultural land plot is determined on the basis of the assessment of the agricultural land included in its composition and the land occupied by buildings, structures, structures used for the production, storage and primary processing of agricultural products. At the same time, the market value of the assessed land plot is determined taking into account the characteristics of the lands included in its composition, occupied by on-farm roads, communications, trees and shrubs, intended to ensure the protection of lands from the effects of adverse natural, anthropogenic and man-made phenomena, closed reservoirs that cannot be used for business activities. Agricultural land and enclosed bodies of water that can be used for business activities (for example, fishing) are usually valued using the sales comparison method or the rent capitalization method. Land occupied by buildings, structures, structures used for the production, storage and primary processing of agricultural products are assessed by methods of assessing built-up or intended for development of land plots. Land under outbuildings (sheds and other non-permanent buildings) located on agricultural land is assessed as agricultural land. When assessing the market value of agricultural land using the sales comparison method and the land rent capitalization method, the fertility of the land plot, as well as the influence of environmental factors, should be taken into account as part of the cost factors. The main factors determining the fertility of a land plot, in particular, include: qualitative characteristics of the soil layer of the land plot (nutrient content, moisture supply, aeration, mechanical composition, structural composition, acidity, etc.), relief, microclimate. When assessing the market value of agricultural land using the method of capitalization of land rent, there are features of calculating land rent associated with the adopted system for accounting for the fertility of a land plot. Land rent is calculated as the difference between gross income and the costs of agricultural production, taking into account the profit of the entrepreneur. Gross income is calculated for a unit of land area as the product of the standard yield of an agricultural crop and its market price. The standard yield of an agricultural crop is determined by the fertility of the land plot, measured in quality points. The selection of the main and associated agricultural crops for which land rent is calculated is carried out from a set of crops typical or traditionally cultivated at the location of the land plot. At the same time, the criteria for choosing crops and their rotation are to ensure the greatest income and maintain soil fertility. Material costs for the production of agricultural products are determined on the basis of technological maps that establish standard costs of seeds, fuels and lubricants, fertilizers, etc. in kind. Costs in monetary terms are calculated based on market prices prevailing in the area where the land plot is located. When calculating costs, the level of engineering development of the land plot is taken into account, including the density of the road network, the class of roads, proximity to transport routes, points of processing of agricultural raw materials and logistics centers. When calculating gross income from arable land, the possibility of obtaining several harvests during one season for vegetable products and medicinal plant products can be taken into account. The deposit is assessed by the method of intended use, taking into account the economic feasibility of its transfer to another type (types) of agricultural land. When calculating the gross income of hayfields and pastures, one should proceed from their standard yield. The standard yield of hayfields and pastures is determined by its conversion into centners of feed units (1 centner of feed units equals 1 centner of oats). In this case, the amount of gross income is determined on the basis of the market price of oats. When calculating the gross income of perennial plantings, it is recommended to proceed from the frequency of their fruiting and the standard yield of fruit and berry products. This takes into account: the age of perennial plantings; species-varietal composition of perennial plantings; features of the spatial placement of perennial plantings within the boundaries of the land plot; the possibility of generating income from additional products obtained from the rows of orchards and vineyards. APPROVED by Order of the Ministry of Property of Russia dated September 2, 2002 No. 3062

The domestic legislator pays close attention to the procedure for determining the value of real estate. Regardless of the purposes of determining the described indicator, the methodology for assessing the market value of certain things is essential.

Valuation of land plots

Assessment is needed for:

  • object insurance;
  • his collateral;
  • adding the site to the authorized capital of the enterprise;
  • land acquisition;
  • in other cases.

The Ministry of Property, by Order No. 568-r dated March 6, 2002, approved the Methodological Recommendations for determining the market price of land.

The specified act of rulemaking is used to establish the actual and justified value of the object under study, but only on the condition that the corresponding land plot is not excluded from circulation.

It is important to note that market prices and methods for calculating prices for services for calculating the cost of a land plot are not regulated or limited at the legislative level. The remuneration for the described work is agreed upon by the land owner and the specialist, after which it is fixed in the agreement for the provision of appraisal services.

The assessment agreement must necessarily contain a description of the land plot and the timing of the report, as well as other information provided for in Article 10 of the Federal Law of July 29, 1998 No. 135-FZ “On Valuation Activities in the Russian Federation”.

Principles of assessment

Regardless of the methods used to assess the market value of land, the actions of the relevant specialist should be based on the following principles:

  • usefulness of the site;
  • the market price correlates with the supply and demand for land;
  • the desired value must be within the cost parameters of analogues;
  • the final result should be determined based on the most effective and efficient use of the object;
  • the calculated indicator is subject to change over time, and also directly depends on the permitted uses of the site and its intended purpose.

An important factor influencing the determination of the price of the property under study is its address and other circumstances affecting the attractiveness of the property.

The calculated market value of the land plot is reflected in the appraiser's report, drawn up by a specialist after the work is completed.

The final document must indicate:

  • description of the land plot;
  • on real estate, utility networks, landscaping elements and other factors that may affect the determination of the price;
  • photographs of the object under study and the things located on it;
  • general description of the land market;
  • determining the most effective way to use the subject of assessment.

Methods for assessing the market value of land plots

One of the acceptable ways to determine the market price of a land plot is to compare sales. A characteristic feature of this approach is the possibility of its application if there is information about the value expression of land transactions, as well as the cost of supply or demand.

The next way to determine the actual price of a built-up property is the allocation method. It consists of studying the cost of completed or proposed transactions with analogues, as well as the presence of improvements on the site designed to increase the efficiency of land use.

To determine the cost indicators of built-up areas, the distribution method is used, among other things. This approach is characterized by the inclusion in the calculation mechanism of information about the share of land in a single property.

If the possibility of receiving rent from the use of the plot is envisaged, then the acceptable method of calculation is the capitalization method.

If it is possible to develop land with real estate capable of generating income, the residual method must be used.

Another method of calculation is the estimated revenue-generating use approach.

As a conclusion, it should be noted that each appraiser independently chooses not only a specific method for determining the market price, but also an approach to valuation (cost, comparative or income).

Moreover, the listed research methods are not exhaustive, and the relevant specialist has the right to apply other calculation options specified in the Federal Valuation Standard “Real Estate Valuation (FSO No. 7)”, for example:

  • methods of comparative approach (relative comparative analysis, expert assessments, regression analysis, quantitative adjustments and others);
  • methods for income analysis (direct capitalization, cash flow discounting, capitalization using calculation models);
  • costly option (extraction, expert assessments, analytical models).

The expert also has the right to combine various methods and approaches in the assessment.



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