Promulgating the use of land valuation and appraisal (1)
Have you ever been to a big city where everything seems dense and congested but eventually found abandoned land or building? Some of these indicate the sales billboard which may have been there for quite some time. Oh but no, really long time. You cannot help but wonder how could such a strategic place takes big efforts to find a potential buyer. This problem also happens to individuals who wants to sell their land assets, buyers or investors, financial institution who gives loan, and the government who (really) needs the taxes. Conventionally, the valuers from each party has their own methods and use their time to assess the building, the location, and definitely the market’s state. Indeed, it depends on the merit of each appraiser, but is that the best way to approach land value? The answer of this question is complex, which means land sales are heavily uncertain and full of risky undertakings. But that statement is only half true. While there are options to unravel the uncertain in this digital era, we cannot let the land sales keep rolling in the vortex of clueless land appraisers.
Before we begin the series of discussion on land valuation and appraisal, I will highlight the ‘why a revolutionary method is important’ and much more relevant these days. This includes our way of seeing land and building, the manipulative market state, when the people become victims, and the government that cannot do much.
Altering the mindset
We predominantly think by the book, which leads us to a procedural way of thinking. This also happens in the way the appraisers assess the land. But it is really hard to change if the assessments are done manually. By having a standard procedure, the methods designer hopes the appraisal would be as objective as possible. But in the reality, the error is rather huge because the land itself is dynamically changing while the procedure stay the same. The different state between the procedure and reality creates fundamental difficulties. I am not saying that we should eliminate the subjectivity at all, no. By realizing our limitation and altering the shortcoming, we could create a better method. We should accept prior to the transformation that combining human and technology can lead to a robust tool to appraise the land.
The deceptive dependency to the market state
Rapid urban development is characterized by changes in land use into functions of housing, commercial, industrial, and other built-in areas are common phenomena that occur in cities in the metropolitan and big cities. As a result, land values experienced a significant increase in a relatively short time. The increase in land value is often not predictable because it is based on the calculation and control of the price of transactions from the private sector. However, we cannot blame the private sector. Leaning only to the market state.
Bridging the gap for the people
The underlying problems are related to people’s affordability of land and housing prices
About the public realms
The government is unable to capture the benefits of increasing the value of the land to be applied to various policies related to land development.