Land Residual Technique
Definition of "Land residual technique"
Technique used to estimate how the value of a parcel of land will affect its ability to support a given commercial improvement leaving sufficient residual net income to maintain adequate profitability. The commercial value of the land must exceed its purchase price in order for there to be sufficient residual income. Capital land valuation is determined by capitalizing the residual net income. Property tax appraisals and condemnation awards normally require the land residual technique. Unimproved land values are determined through this technique and the value of the improvements are added to establish a total improved land value. In computing land residual value, an appraiser values structural improvements at their cost. Costs associated with the building are deducted from net income. The remaining value is residual the land.
Popular Real Estate Terms
The term effective interest rate is the actual return from a savings account or any investment where you pay interest when considering the effects of compounding costs over time. Through an ...
A lien on the property of a mortgagor. In most states a mortgage gives the mortgagee a lien-as opposed to the common-law practice of granting conditional title-on the house or property as ...
The most common definition of a subdivision in real estate terms is when a piece or parcel of land (referred to as a plot) is divided into smaller parts by its owner. A subdivision’s ...
To understand what a principal broker is, we have to go back up the family tree of real estate.You do understand all brokers can be real estate agents, but not every real estate agent can ...
Legal lien on property on behalf of an individual who has not been paid for material furnished in constructing property. The material enhanced the value of the property, and as such the ...
Provision in a credit contract specifying that if the lender sues the borrower for late payments, the borrower accepts guilt in advance, irrespective of the reason for nonpayment. ...
Legal action of a landlord to remove a tenant.The tenant may have violated the lease agreement such as for the tenant's failure to pay the rent. ...
All the costs involved in constructing a development project including the cost of acquiring a parcel of land, paying for contractors labor, materials as well as taxes and development loan ...
The vertical elements of a door or window frame which provide vertical support to the overall frame. ...
Have a question or comment?
We're here to help.