5. Land Market influences

5.1. Words to remember:

earn	добывать (сведения)
designations	предназначенность
percolation test	фильтр-тест
hook up to sewer	устраивать застройщика
cost-prohibitive	чрезмерно, непомерно высокая цена, издержки и т.п.
pertain to	относиться к.
contraction	зд. катастрофический факт, катаклизма
laissez-faire	экономическая доктрина, согласно которой государственное вмешательство в экономику должно быть минимальным....
maturity	окончание срока

5.2. Read the text.

In the past 100 years we have seen long periods of economic contraction, including deflation and panics; long periods of expansion; periods of inflation; long periods between recessions; and short periods between recessions.

In the past 100 years we have seen long periods of economic contraction, including deflation and panics; long periods of expansion; periods of inflation; long periods between recessions; and short periods between recessions.

When hiring a Realtor to market vacant land, the seller often relies on the Realtor's expertise when determining a listing price. The Realtor utilizes the knowledge he has in local land values when making the assessment. The Realtor's assessment is his educated opinion, and not a guarantee of what a buyer will pay for the land.

Realtor

Not all real estate agents are Realtors. A Realtor is a member the National Association of Realtors, which is a professional organization. Some Realtors specialize in land sales and earn designations and certifications specific to land sales. The Realtor Land Institute, a Realtor organization specific to land specialists, offers the Accredited Land Consultant designation.

Consideration

When assessing land, the Realtor must identify a number of property features. The Realtor considers the property's size, access, shape, restrictions, slope, zoning, use, waste and the available utilities. Two seemingly identical pieces of property can be drastically different in price if one has utilities to the site and another does not. The property may be beautiful, but if it won't pass a percolation test and is not hooked up to sewer, it may be cost-prohibitive to build a suitable waste system on the site. Same-size lots next to one other can drastically differ in value if one is flat and buildable and the other is sloped and requires major grading before construction.

Depreciation

A primary difference between assessing vacant land and land with improvements is that land does not depreciate, while improvements do. Vacant land is not a renewable resource. It is possible to rebuild a building, but you cannot make land. If a previous owner left something behind on a lot deemed vacant, such as underground storage tanks or a dilapidated shed, the property's value is typically less than an identical property free from physical encumbrances.

6. Approaches to Determine Value

6.1. Read the text.

There are three basic approaches for determining property value. They include the cost approach, the income approach and the sales comparison. The cost approach would not typically pertain to vacant land, as it applies to unusual real estate, such as a church, were there are no comparable properties. In some instances, the income approach might be appropriate. This typically applies to income-producing property, such as shopping centers or apartment buildings. If the vacant land produces income, such as in crops, it may apply. The most reliable method is the sales comparison. This involves locating comparable properties that sold recently and averaging their adjusted sale prices. An adjusted sale price is an adjustment of the actual sale price of the property by adding or subtracting an amount to compensate for the differences between the comparable and subject properties.