STATISTICAL EVIDENCE VS THEORETICAL POSTULATION OF THE RELATIVE IMPORTANCE OF LAND VALUE VARIABLES VIS-À-VIS BUILDING VALUE VARIABLES IN THE PROPERTY VALUATION MODEL

C P Igwe, J C Onyejiaka, Udoka C Ugonabo

Abstract


Urban expansion has brought in its stead land speculation, artificial land scarcity, exorbitant land prices and consequent urban sprawl in the cities. This necessitates a move towards making land available for developers who are keen on immediate development and curbing the anomalies on land use. This study developed a model that can partition property value into land value and building value in Anambra State Nigeria with a view to proffering a solution to ‘code rate’ method of determining tax payable for properties for a sustainable land use and development. The paper has identified sales comparison approach for estimating values of vacant land and abstraction, allocation and contribution approaches for land in built up urban areas. In order to determine land value, the study adopted a variant of contribution value approach to suit the study area. Survey design was used to generate data on land and building variables which were used to arrive at land values, building values and property values with the aid of excel spreadsheet.. A computer assisted mass appraisal (CAMA) model was developed for low and high density areas of the study area. The study discovered that property value can be effectively partitioned into its component values and up to 40% of property value accrues to land. Land value variables, when compared to building value variables are very significant in the overall property value, hence the cogent need for its taxation. This will guarantee equitable taxation of the components according to their contribution in the overall property value while discouraging speculation, urban sprawl and sustainable land use.
KEYWORDS: Computer Assisted Mass Appraisal (CAMA), Model, Land Value, Building Value, Sustainable Land Use, Land Value Taxation


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