Vacant Land Located at Darling Heights - Report Example

Land Valuation Student’s Name School of xxxxxx Customer Inserts Tutor’s Name 10th October, 2013 Table of Contents Legal Section 3 Location 3 Land 5 Improvements 6 Sales Evidence/Schedule of Sales 6 Valuation of vacant land located at Darling Heights 7 Signature 8 Disclaimer 8 Full Analysis of Sales 8 Check Valuation Method 9 Valuation Summary and Conclusion 10 References 11 Appendices 13 Appendix 1: Valuation grids 13 Appendix 2: Locality Maps 15 1.Locality Maps 15 Appendix 3: development 17 Legal Section Valuation definition For the purpose of this report, the market value is the price at which the seller and the buyer are motivated to transact at based on their prudency. At this price all the parties involved are not stimulated by other external factors except their personal interest. The same price can be paid by any other prudent buyer. Therefore, the market price is assumed to be the price which is determined by market forces. Inspection date- is 31/1/2013 Client the client for this report is Shane Simmons and the registered proprietor is IM Owner. Property address- The property is situated at 5 Dalzell Crescent, Darling Heights and Toowoomba. Real property description- The really property legal description is Lot97 on SP8339414, Parish of Drayton. Dimensions/area/tenure the property has an area of 673 which is a freehold tenure and there is no encumbrances and restrictions Local authority The property is in the Toowoomba Regional Council. Zoning- The land use for the property is mixed housing that is it is suitable for single unit dwellings typical for residential housing and high density accommodation. Statutory valuation The statutory site valuation as at 30/6/2011 was $113,000. Highest and best use The land can be used for housing although it can also be used for farming and grassing. Location The land under valuation is located within Toowoomba Regional council which has a population of approximately 100,000 people. The land is situated in street in the suburb of Darling Heights near the southern edge of Toowoomba boundaries. The property is surrounded by residential homes which are designed using bricks, veneer, and pitched aluminum roofs with fences. The residential houses in the area have good landscaping, a stenciled concrete to SLUG driveway, a verandah and gas heaters. Access - The site will be accessed using two lane bitumen carriage that is in good condition and are close to parkland Services-The place has electricity, good supply of gas, council sewerage line and water. There is also a public bus to the area, a good telecommunication system and refuse collection. Amenities- in the area there is both primary and secondary schools, University of Southern Queensland, parks for recreational and there is a number of child minding facilities. In sporting, the area has rugby union, rugby league, touch football, softball, soccer and baseball. The are petrol stations within the vicinity, hotels and fast food joints. Regional data Below is the building footprint on the site: Land The land is situated 120km Northwest of Brisbane, the capital of Queensland. It is 673m2 Size/shape: 673m2, regular shaped lot View/location: alongside street Drainage/soil/lawn: benching/drainage okay, red soil, turfed Orientation/level: generally north-south, above road level Improvements Type : Residential units, Age : 15years Construction : old brick veneer supported by concrete with pitched aluminum roof having a living area of 145m2. Heating : reverse cycle air conditioner Bedrooms : 3, carpet and with built-in wardrobes Extra : no, two way bathroom and spa Toilet/bathroom/ensuite Lounge room : carpeted floor, good sized Family meals room : tiled floor, Kitchen : standard appliances Laundry : standard fittings Car accommodation : attached single lock-up garage (SLUG) External appeal/entrance : average small entrance verandah (approx.1m2) Outside Entertainment: entertainment area (30m2) Shed: garden shed (10m2) Fencing: rear and to side of house Landscaping: lawn and landscaping both front and back Driveway: stenciled concrete to SLUG Maintenance issue: well maintained Sales Evidence/Schedule of Sales Recent sales data of the area has been compiled and analyzed within our due diligence process regarding our possible options. Feasibility analysis of all the options is further discussed, and below are the comparable sales analyzed. address Sales date Selling price description 12 Krog Court 6 January 2013 $292,500 Land area was 600m2 regular shaped. It had a well renovated, 3bedroomed house with a dining and a large family lounge. The house had an entertainment area, double lockup garage and a gas heated living room. 6 Jade close 27 January 2013 $315,000 Land area was 600m2 irregular shaped. It was a well renovated, in quiet cul-de-sac, close to park, new kitchen includes dishwasher, large covered entertaining area, 3 built in bedrooms, ceiling fans, reverse-cycle air conditioner, 5,000L rainwater tank, single lock-up car garage. 5 Jade close 20 July 2013 $157,000 Land area was 642m2 regular shaped plot. The plot was vacant 2 Dalzell Crescent 30 July 2013 $190,000 Land area was 699m2 irregular shaped. The land was vacant Valuation of vacant land located at Darling Heights KAL- 16- 2030 October 8, 2013 Shane Simmons 5 Dalzell Crescent, Darling Heights, Toowoomba Dear Simmons Re: Valuation of Real Property Legal Description, Lot 97 on SP 839414, Parish of Drayton. Following your request, our team has inspected the above property situated at 5 Dalzell Crescent, Darling Heights, Toowoomba and carried out analysis to determine the market value of the property. The period that is taken by the buyer and other costs have not been considered. In our assessment, we are of the opinion that the market value of the property as at October 8 was as follows. Market value of vacant land $173,250 Market value of really property $324,000 The following assumptions are applicable to this valuation and if they are altered the valuation may change. There is no expected cost associated with environmental contamination as well as no natural resources which can hamper its’ use. The developer will not incur extra ordinary cost in serving sewage and water system. There are no costs associated with demolition of the existing structures. The Zoning will not change unless through a planned review. Signature Disclaimer This report is made on behave of Shane Simons and should not be relied upon, availed to any third party for use. It should not be copied without our consent Full Analysis of Sales A 4 Dalzell Crescent 6 Jarde Close 12 Krog Court Price $ 270,000.00 $ 315,000.00 $ 292,000.00 Heating $ 2,000.00 $ 4,000.00 $ 2,000.00 Entertainment: $ 5,000.00 $ 5,000.00 $ 5,000.00 garden shed $ 7,006.00 $ 7,006.00 $ 7,006.00 Fencing $ 1,500.00 $ 1,500.00 $ 1,500.00 Landscaping $ 2,500.00 $ 2,500.00 $ 2,500.00 Driveway $ 1,000.00 $ 1,500.00 $ 1,000.00 town water $ 2,500.00 $ 2,500.00 $ 2,500.00 External appeal/ entance $ 1,000.00 $ 1,000.00 market value $ 291,506.00 $ 340,006.00 $ 314,506.00 Because there are a number of differences and only three comparable properties then not all the characteristics can be reconciled. Simple differences such as landscaping, heating, repairs, driveway and entertainment area can be given a ‘cost’ value for construction, installation etc. to allow all properties to become identical. You tend to concentrate on the variables that may represent the greatest difference or cost to the subject property or value to the subject property. For house and land the major variables tend to be the land area, depreciation when you have comparable sales of different eras, house size and quality and material, entertainment areas, car accommodation and location. Check Valuation Method Based on TooWoomba regional town council economics briefs figures for the march 2008 quarter , There is rapid change in consumer and business confidence is a significant factor. With interest rates falling to their lowest level in 40 years sentiment has become a mix of optimism and fear. The optimism flows from the positive impact on home affordability, with the fear coming from the constant data of falling property values and the rising rate of unemployment. Discussions with agents indicate the greatest fear is unemployment. For property investors, the apprehension is that rising unemployment may begin to depress rents. One clear indicator is the market segmentation which shows a good market under $205,000 for land. The residential land market is similarly fragmented with land priced under $205,000 considered to be the strongest performing market. This price point fits comfortably with the price bracket required for “house and land” packages. For more expensive land the market is different. Whilst there are buyers for land over $300,000, sales rates are slowing. The location will need to be an area of limited supply and provide the lifestyle infrastructure the market desires including proximity to the CBD. Accordingly, due to the lack of transactions occurring, it is very difficult to determine the market value of sites. Further, agents indicate that in the current market, potential purchasers are increasingly seeking lengthy settlement terms in order to either secure finance or to remove a degree of risk attached to the transaction by entering into a ‘subject to Development Approval’ contract. Sites which have holding income are more sought after, with those which have Development Approval viewed as the next best. This scenario is also clearly linked to the difficulty in obtaining credit. Sites without approvals or requiring a long term hold are becoming very difficult to sell with very limited buyer interest. In this environment the definition of Market Value “a willing but not anxious buyer and seller” is being tested. The reality is that all vendors are anxious or are being pressured to sell. Buyers are not particularly” willing” unless it is perceived to be a bargain. Previously buyers for large development sites and medium term hold sites were publicly listed companies, but as they attempt to repair their balance sheets, they are in a selling mode and not buying unless it includes long settlement terms. Valuation Summary and Conclusion The method of value is by direct comparison for improvement and vacant land for approximately $250 per square meter for darling heights which has been used to in this valuation. There is an analysis of evidence of a number of comparable sales as well as taking into account economic conditions at the time of valuation and have arrived at the opinion that the market value of the subject property as at 10th October, 2013 is as follows: Land Value: $173,250 Improvements: $150,750 Market Valuation: $324,000 References Greater Halifax Partnership, May 2011. ‘Shipbuilding in Halifax” Report prepared based on Conference Board of Canada Analysis. University of Southern Queensland, 2013. Study book - Land administration Faculty of Engineering and Surveying SVY3200. ICE Publishing System Appendices Appendix 1: Valuation grids Valuation grids (all comparison grids and final grid Analysis of sales difference for sales 2 and 3 Quantifiable differences: Town water = $7 115 Land area $895 * (5 004 – 4 458) m2 = $4 885 Entertainment area Pergola to be constructed at cost = $5 000 Landscaping Landscaping to be done at estimated cost = $1 000 Heating Woodheater to be installed at cost = $2 000 Repairs Estimated at cost = $2 000 Adjustment grid sales 2 and 3 2 3 Price $175 000 $159 000 Town water – $7 115 Land area – $4 885 Entertainment area – $5 000 Landscaping $1 000 Heating $2 000 Repairs – $2 000 Adjusted price due to quantified differences $178 000 $178 000 Check of adjusted prices due to quantified differences: $0 Adjustment grid for subject, sale 1, sale 2 and sale 3 Sale number Price ? $155 000 $175 000 $159 000 Entertainment area yes $5 000 – $5 000 Land sq. m. 4334 $7 006 ($5 994) ($1 109) Repairs minor $2 000 – $2 000 Town water yes – – $7 115 Landscaping minimal ($2 500) ($1 500) ($2 500) Heating yes $2 000 $2 000 – Driveway yes $1 000 – – Rain water no ($1 000) ($1 000) ($1 000) Fencing part only ($1 500) ($1 500) ($1 500) Adjusted price: $167 006 $167 006 $167 006 Say: $167 000 This leaves a market value of $167 000 for the subject property. Appendix 2: Locality Maps 1. Locality Maps Appendix 3: development Figure 1: 5 Dalzell Crescent (main front) Figure 2: 5 Dalzell Crescent (entertainment area) Figure3: 5 Dalzell Crescent (living)5 Dalzell Crescent ( Kitchen & kitchen family) Figure 4: 5 Dalzell Crescent (living) Read More