Valuation of developable land, by the objective jurisprudential method

Abstract

This study examines the valuation of developable land in accordance with the provisions of Transitional Provision 3, Section 2, of the Land Act 2015 (LS15), applying the objective method established by case law — subsidiary to the residual method — in circumstances where no reliable real estate market exists and, consequently, no dependable comparable transactions can be identified within the area under appraisal. The calculation is based on the regulated sale price of subsidized housing as defined by the corresponding Autonomous Community. The author supplements the case-law-based objective method to address scenarios in which land uses other than subsidized housing are present or may foreseeably be allocated within the land parcel subject to valuation, applying the homogenisation coefficients — or relative use-weighting factors — as prescribed in the operative urban development plan of the municipality in question. This methodology can thus also be deployed as a subsidiary residual method for the valuation of consolidated urban land under the LS15 framework