highest and best use of land

Well help you determine exactly what will be the most profitable for you in the long run. So before you lock yourself into commercial development be sure to consider residential highest and best use for the land as well.

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Regardless of property type the approach to determine highest and best use is the same.

. 1 legally permissible 2 physically possible 3 financially feasible and 4 most profitable. The use must be consistent with the site characteristics and physical features of the property. According to The Uniform Standards of Professional Appraisal Practice 2002 highest and best use is defined as The reasonably probable and legal use of property that is physically possible appropriately supported and financially feasible and that results in the highest value.

What does highest and best use mean. Appraisers begin their highest and best use analysis reviewing building codes zoning private restrictions environmental regulations and historic controls. It should be recognized that in cases where a site has existing improvements on it the highest and best use may be determined to be different from the.

Highest and best use. In a real sense the definition of highest and best use encompasses four tests. The use must add more value than it costs to implement.

Steps Three and Four financially feasiblemost profitable cannot be determined until the first two. In March of 2020 Fannie Mae issued another Appraiser Update and again discussed excess land. Week 4 Highest and Best Use USB142 Residential Valuation 2020 Se 1 1 Economic life of a building Over time the demand for land resources changes brought about by changes in the size income and tastes of the population the rate of growth methods of transport techniques of production and distribution and so on.

Above weve used highest and best use in the definitions of excess and surplus land. But rather it is a use shaped by the competitive forces within the market where the property is located. Highest and Best Use Example.

The first two tests are interchangeable in order and in many circumstances the last two are combined. If you need help finding land or determining the highest and best us give us a call at 602-492-9242 or visit us online. The highest and best use of a property must be one that is.

On the supply side existing buildings wear out or. The four tests of highest and best use are. This newsletter began by quoting a line out of USPAP that states.

The use must comply with laws regulations and ordinances. When analyzing vacant land the amount of. The existing use will continue however unless and until land value in its highest and best use exceeds the total value of the property in its existing use In my opinion the highest and best use of the subject land assuming it is unimproved is as a single family site with the balance of the land either operated as a hobby farm or.

Highest and Best Use is the likely use selected from a number of available choices to which an area of land or a building may be put based on what is physically possible and in compliance with zoning and building regulations and which at the time of an appraisal produces the most profitable present value of the land. Alternatively highest and best use is that use from among reasonable probable and legal alternative uses found to be physically feasible and which results in the highest land value. An appraiser must analyze the relevant legal physical and economic factors.

To support the appraisers highest and best use conclusion s. Highest and Best Use of Land as if Vacant The definition of highest and best use of land as if vacant requires appraisers evaluate the following four criteria. Highest and best use can be defined as the reasonable probable and legal use of vacant land or an improved property which is physically possible appropriately supported financially feasible and that results in the highest value.

The highest and best use of a specific parcel of land is not determined through subjective analysis by a property owner developer real estate agent or appraiser.

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