In real estate condemnation, an economic unit refers to whether some or all of the property taken has a different highest and best use than the larger parcel.
Evaluation in real estate involves a detailed study of the potential uses of a property, but it does not focus on determining the present value. It includes analyses such as market trends, feasibility studies, highest and best use assessments, and base land use.
Excess land refers to the portion of a property that sits beyond the amount needed to support its current highest and best use, and which has the potential for separate development.
Financial feasibility assesses whether a proposed land use or change in land use can economically justify itself. This evaluation is a crucial aspect of determining the highest and best use of the land but does not alone determine the optimal land use.
Highest and Best Use (HBU) is a real estate appraisal term that represents the legally, financially, and physically feasible use that, at the time of appraisal, is expected to produce the highest net return to the land and/or buildings over a given period of time. This concept can be applied whether the property is vacant or already developed.
The Land Residual Technique is a method used in real estate appraisal to estimate the value of land by using the net operating income (NOI) and the value and return of improvements on the property. It is especially useful for feasibility analysis and determining the highest and best use of a property.
Principle (Appraisal) refers to basic economic facts that underpin the theory of valuation in real estate. Key principles include substitution, contribution, anticipation, and highest and best use, which assist in accurately determining a property's market value.
Setoff refers to special benefits arising from a condemnation that offset any damages that may have occurred to the property owner, balancing the advantages gained against the losses suffered.
Surplus land is a portion of a parcel that exceeds the area required to support the current highest and best use of the property, but holds no separate value apart from the main parcel.
The underimprovement occurs when a property or development exists at a lower investment or utility level than the optimal usage potential of the site.
The valuation process is a systematic method used by appraisers to derive an estimate of the value of a property, essential for making informed real estate transactions.
Value In Use refers to the worth of a property in a specific use, typically its current usage. It may significantly differ from its market value, reflecting its utility in the given context.
