Land Evaluation

Name: University: Course: Tutor: Date: Land Evaluation Before Shane Simmons purchases a house and land for private residence, a valuation report appraisal will have to be prepared using the comparable sales method. The value of a house is estimated by comparable sales approach (CSA) through comparison of similar properties which were sold recently and are located in similar regions. The approach assumes that the worth of a property is what it sells for in a reasonable time period without the presence of undue stress (Property-Investing.org 2011). The client has already located the property whose street address is 39 Lavarack St, Darling Heights, Toowoomba. In addition, the legal description is Lot 7 on Sp 16426913, Parish of Drayton. This document provides a valuation report appraisal of the above property based on comparisons made on similar properties located in the region. The table 1 below represents some similar attributes of the properties located within this particular area. The attributes of the properties will be compared based on the comparable sales values which have been provided. It is evident that these properties were sold within a time span of three months, from July, 2010 to October, 2010. Property 12345Price$363,000$353,000$371,000$329,000n/aTime15/09/201018/10/201012/7/201026/7/20102/10/2010Land Area m2700600660636732ShapeRegularRegularRegularRegularRegularLocationQuiet streetFeeder street to schoolFeeder streetCorner of residential streetQuiet streetElevationNorth-south, Road levelNorth-south, Road levelEast-west, Road levelNorth-south, Road levelEast-west, Road leveltopographyLevellevellevelWell drained level Table 1: Different attributes of properties and their sales information (University of Southern Queensland 2010, p.10) This method was found to be more appropriate since the houses in question are in a suburb and they are approximately of standard size, condition, design and age. In addition, when sales attributes of two properties are identical, the sales price may differ due to an attribute that is different between the properties. When a comparison is made on some similar properties, people will be in a position to give a particular value to individual characteristics which give value to the property (Pagourtzi 2003, p.389). Afterwards, the price value of the subject property will be determined through adjustments of comparable sales to be identical to the subject property. If a land is vacant, differences in sales prices can be attributed to several characteristics such as land size, general location, shape, topography, views, drainage, street position, soil type, orientation and road level. Analysis of sales difference Unquantifiable: Land area Adjustment grid sales 2 and 3 Property23Price $353,000$371,000Land area600660 Land area difference: 60 m2 Effect of land area difference is the change in sale price: $18,000 = $18,000 / (660 – 600) = $300 per sq. m We can conclude that properties located in Feeder Street are valued at $300 per sq. m and therefore properties with similar attributes will be sold at similar prices. In our current example, we need to find the values per sq. m of properties in different locations (like Quiet Stree...