ALC flashcards
ALC · Build recall with a focused review session.
32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Stumpage value
- The value of standing timber as sold by the landowner, computed as volume times species and grade price, less harvest and haul costs.
- Animal unit month
- The forage quantity needed to support one animal unit, typically a 1,000-pound mature cow, for one month; used to set grazing stocking rates.
- Prior appropriation doctrine
- A water rights system in which the first to put water to beneficial use holds the senior right, and senior rights are satisfied first during shortages.
- Conservation easement
- A recorded deed restriction that permanently limits development or use of land, often to protect habitat or agriculture, and usually reduces market value.
- Perennial crop ramp-up
- The multi-year period before vines or trees reach mature production, requiring income models that account for age-class yields and establishment costs.
- Highest and best use
- The reasonably probable use that is legally permissible, physically possible, financially feasible, and maximally productive, supporting the highest land value.
- Subdivision development method
- A valuation technique that subtracts development costs, developer profit, and entrepreneurial incentive from gross sellout revenue to indicate raw land value.
- Absorption rate
- The pace at which lots or units sell in a market over a period, used to estimate months of supply and the timing of development revenue.
- Months of supply
- Available inventory divided by average monthly absorption; a measure of how long current land or lot inventory would take to sell.
- Entitlement risk
- The uncertainty that zoning, environmental review, utility capacity, or permits will delay or prevent development, reducing what a buyer will pay for raw land.
- Land basis per lot
- Total land acquisition, carry, and entitlement cost divided by the number of approved lots; compared against comparable finished-lot prices to test feasibility.
- Net usable acreage
- Gross acreage minus areas lost to wetlands, floodplain, steep slopes, easements, and roads; the area actually available for development.
- Plat recordation
- The filing of an approved subdivision map with the county, after which individual lots may be legally conveyed as separate parcels.
- Assignable contract
- A purchase agreement without an anti-assignment clause that lets the buyer transfer its rights to an end buyer for a fee before closing.
- Double closing
- A structure using two separate settlements, one with the original seller and one with the end buyer, so the wholesaler's spread is not disclosed.
- Liquidated damages deposit
- Earnest money designated as the seller's sole remedy for buyer default, capping the wholesaler's downside risk at the deposit amount.
- Infrastructure cost per lot
- Total road, water, sewer, and drainage cost divided by lot count; declines as density rises because many costs are fixed per linear foot.
- Plottage increment
- The increase in value created when two or more parcels are combined into one ownership whose utility and value exceed the sum of the parts.
- Assemblage holdout
- An owner within a target footprint who refuses to sell or demands a premium, potentially defeating the project or raising total acquisition cost.
- Option agreement
- A contract granting the right to buy land at a set price within a stated term, letting an assembler control parcels while limiting capital at risk.
- ALTA survey
- A detailed boundary survey meeting lender and title standards that identifies easements, encroachments, improvements, and access, used in acquisition due diligence.
- Site selection screening
- Evaluating candidate parcels on access, visibility, traffic, utilities, zoning, topography, environmental constraints, and proximity to demand generators.
- Units of comparison
- Standard measures used to compare land sales, including price per acre, per square foot, per front foot, per lot, and per animal unit.
- Sales comparison approach
- A valuation method that adjusts prices of comparable land sales for differences in time, location, size, access, utilities, zoning, and topography.
- Land capitalization rate
- The rate used to convert ground rent or net operating income into land value, reflecting land's risk and growth expectations.
- Tract size effect
- The tendency of larger parcels to sell for less per acre than smaller parcels because fewer buyers can afford the total price.
- Reconciliation
- The appraiser's process of weighing the value approaches by relevance and reliability and explaining which indication carries the most weight.
- Absolute auction
- An auction in which the property sells to the highest bidder regardless of price, with no seller reserve and no right to reject the high bid.
- Reserve auction
- An auction in which the seller may reject bids below a stated reserve price, and the seller may bid only if that right is disclosed.
- Buyer's premium
- A disclosed percentage added to the high bid and paid by the winning bidder, increasing total acquisition cost above the hammer price.
- Cash rent lease
- A farm lease paying a fixed amount per acre, placing price and production risk on the tenant while giving the landlord predictable income.
- Crop-share lease
- A farm lease paying the landlord a share of the crop, aligning landlord and tenant incentives but requiring yield and price accounting.