Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Land Value

What it is:

Land value is the overall value of a piece of property.

How it works (Example):

The value of a piece of property includes a number of variables including location, the distance of from commercial and health amenities (for example, shopping centers, hospitals and restaurants), the quality of the school district and enhancements to the property itself. The land value of a piece of property correlates directly with these variables. For example, property located in an attractive setting in a safe, high-quality school district likely has a relatively high land value.

Why it Matters:

Property in the real estate market is priced according to its land value. Socioeconomic changes and commercial development in an area affect land values and can result in capital gains or losses for property sellers.