The valuation of residential land involves the combined value for the primary land (homesite), secondary land, and the tertiary or excess land.  Refer to Procedure 019/030/012 for specific information on the homesite valuation.  The secondary land is used to support the homesite land.  The tertiary or excess land is generally not used to support the dwelling.  

State law requires the value of an improved parcel to be separated into land and improvement components. 

The Supervisor of Assessments is to ensure that a review of land values occurs at the beginning of each reassessment cycle.  

The sales comparison approach is the primary approach to land valuation and is always preferred when sufficient sales are available. In the absence of adequate sales, other techniques that can be used in land appraisal include allocation, market extraction, capitalization of ground rents, and land residual analysis. 

An improved sale where the structure is intended to be torn down may be considered as a vacant sale and used in the sales comparison approach. The office should update the sales conveyance code to reflect the sale coding as vacant arm’s-length once the demolition permit has been issued.

Assessors are to consider the allocation approach when there are limited vacant land sales within the market area, and the area is primarily developed with fairly consistent lot sizes and building types.  The allocation is the ratio of current assessed land value to the total assessed value.   By analyzing the land assessment ratio to the total property’s value, assessors can determine when land values need to be adjusted. The Supervisor of Assessments is to determine the adequate ratio ranges to support the land valuation in their jurisdiction.

With condominium and co-op complexes, a ratio is applied to the total value of the property to allocate the land value. The land value includes the common areas that owners have access to use within the neighborhood. 

Allowances should be made, or factors applied, to recognize the appropriate difference in value between fully developed lots and lots at a lesser stage of development, or to recognize conditions such as poor topography, flooding, etc., when the market indicates that the adjustment is warranted. 

It is important to correlate the square foot rates with the one-acre homesite rate in more rural areas so that the market area achieves comparability among various sized homesites. 

It is acceptable to develop a flat “site” rate for townhouse or row house lots of the same basic size and location.  

Assessors are to consider the factors below when valuing land on large acreage parcels that do not have a preferential use assessment in place: