Site Valuation and Property Description
What the exam tests
Site valuation questions test land vs site distinctions, legal descriptions, entitlements, and the five or six site valuation methods. Property description questions test accurate physical data.
Core rules
- Land is undeveloped; a site has improvements and entitlements ready for use.
- Site valuation methods include sales comparison, allocation, extraction, subdivision development, land residual, and ground rent capitalization.
- Legal descriptions include metes and bounds, lot and block, and government survey. A legal description must close and be locatable.
- Zoning, deed restrictions, easements, flood zones, topography, utilities, and access affect site utility.
- Property description should separate real property from personal property and report GLA consistently.
Worked example
A residential site: total property sale price is $420,000. Extraction uses a depreciated building cost of $310,000; indicated land value = $110,000. Allocation applies a 25% land ratio from the neighborhood to $420,000, giving $105,000. The appraiser reconciles to $108,000 after checking vacant land sales. If the legal description is metes and bounds, the appraiser confirms the parcel closes and matches the tax parcel.
Traps
Calling land a site when it lacks entitlements; using assessed value as market value; ignoring an easement that limits buildability; mixing above-grade GLA with basement area; accepting a legal description without checking closure.