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Land value rates for new constructions
The standard land values for new constructions are a crucial factor in property valuation. They affect not only the purchase price but also the financing and eventual return. To make informed decisions, it's essential to understand the fundamentals of determining standard land values. Do you need assistance with evaluating your land? Get in touch with our experts here.
Bodenrichtwerte are a crucial factor for the financial feasibility of new construction projects. A thorough analysis is essential.
Location, infrastructure, and soil condition significantly influence land reference values. A strategic site analysis can increase profitability by up to 3%.
Sustainability and digitalisation are gaining importance. Considering these trends can enhance the attractiveness and value of new construction projects.
Definition and Meaning of Standard Land Values
Standard land values are average location values of land determined for specific areas known as standard land value zones. They serve as a basic reference point for property valuation and are an important basis for taxation. The standard land values are usually set and published every two years by expert committees. These values reflect the average value of undeveloped land in a specific location, taking into account factors such as location advantages, potential uses, and the condition of the land.
Why Are Standard Land Values Relevant for New Constructions?
For new construction projects, standard land values are crucial as they significantly influence land prices and thus the total construction costs. A high standard land value usually means higher land costs, which directly impacts the financial feasibility of a new construction project. Conversely, a lower standard land value can reduce investment costs and make the project more economically attractive. Therefore, it is essential for property buyers and builders to inform themselves in advance about current standard land values to obtain a realistic assessment of investment costs. The analysis of standard land values helps in making the right decision.
Distinguishing from Other Valuation Methods
Besides standard land values, there are other valuation methods used in property evaluation. These include the comparative value method, the income value method, and the real value method. The comparative value method is based on the selling prices of similar properties in the vicinity, while the income value method calculates a property’s value based on expected returns. The real value method, on the other hand, determines a property's value based on construction costs minus depreciation. Unlike these methods, which determine the value of a specific property, standard land values provide an average value for a particular area and thus serve more as a point of reference. More information on land valuation factors can be found here.
Location and Infrastructure
The location and existing infrastructure are crucial factors that significantly influence the land standard values for new developments. Both the macro-location and the micro-location play an important role. The macro-location refers to the economic significance of the region and population development, while the micro-location encompasses the immediate surroundings of the property. Good access to public transport, proximity to schools, shopping facilities, and doctors, as well as the availability of green spaces and recreational areas, are all factors that can positively impact the land standard values. Therefore, a strategic site analysis is indispensable.
Macro-location
The economic strength of a region directly influences the demand for housing, and thus also the land standard values. Regions with a thriving economy and high employment levels typically attract more people, leading to increased demand for housing and higher property prices. Population development also plays a crucial role. Regions with strong population growth generally record higher land standard values than regions with stagnant or declining populations. The Chamber of Agriculture offers further information on regional development.
Micro-location
The micro-location refers to the immediate surroundings of the property and includes factors such as public transport connections, the availability of schools, shopping facilities, and doctors, as well as proximity to green spaces and recreational areas. Properties in central locations with good infrastructure usually achieve higher land standard values than those in remote areas with poor infrastructure. Proximity to green spaces and recreational areas can also positively impact the land standard values, as many people value a high quality of life and a natural environment.
Soil Condition and Topography
In addition to location and infrastructure, soil condition and topography also play an important role in determining land standard values for new developments. The type and quality of the soil influence the suitability of the land for construction and its load-bearing capacity. Topography, especially slope and groundwater levels, can also affect construction costs and thus the land standard values. A soil survey can provide clarity here. Soil assessment is an important aspect of evaluation.
Type and Quality of Soil
The type and quality of soil are crucial for the suitability of a property for construction. Soils with high load-bearing capacity and good drainage are generally more suitable for new constructions than soils with low load-bearing capacity or high groundwater levels. Soil quality, especially nutrient content and contamination levels, can also affect land standard values. Contaminated soils typically require elaborate remediation, increasing construction costs and lowering land standard values. These aspects should be considered in the calculation of property costs.
Topography
Topography, especially the slope and groundwater level, can also affect construction costs and thus land standard values. Properties on slopes usually require more complex and expensive construction measures than flat properties. A high groundwater level can also raise construction costs, as additional measures for draining the construction site might be necessary. The evaluation of agricultural land can serve as a basis.
Legal Framework Conditions
The legal framework conditions, particularly urban planning law and environmental aspects, play a crucial role in determining land value benchmarks for new constructions. Urban planning law regulates the permissibility of building projects and specifies what type of development is permissible on a particular plot of land. Environmental aspects, such as nature conservation requirements and emissions control, can also restrict the buildability of a property and thus influence the land value benchmarks. The information on land value is helpful here.
Urban Planning Law
Urban planning law encompasses various instruments that guide urban development. These include the Land Use Plan (FNP), the Development Plan (B-Plan), and the Land Utilisation Ordinance (BauNVO). The Land Use Plan shows the general type of land use for the entire municipal area, while the Development Plan contains detailed regulations for individual building areas. The Land Utilisation Ordinance regulates the type and extent of permissible development, specifying, for example, what type of buildings is allowed in a certain area. These legal framework conditions have a direct impact on land value benchmarks, as they can restrict or expand the use possibilities of a property.
Environmental Aspects
Environmental aspects, such as nature conservation requirements and emissions control, can also restrict the developability of a property and thus influence land value benchmarks. Nature conservation requirements can, for example, limit the development of land near nature reserves or biotopes, or impose certain conditions on development. Emissions control is intended to protect the population from harmful environmental effects and can, for instance, prevent the establishment of noise-intensive businesses in residential areas. These environmental considerations must be taken into account when assessing properties, as they influence the usage options and therefore the land value benchmarks.
Assessment of Agricultural Land as a Basis for New Construction Projects
The assessment of agricultural land plays an important role when it is considered for new construction projects. Various factors need to be taken into account that can influence the land's value. In addition to soil quality and location, legal frameworks and funding programmes also play a crucial role. A comprehensive evaluation of the agricultural land is therefore essential to make an informed decision about its suitability for a new construction project. The assessment of farmland is a complex process.
Soil Quality as a Decisive Factor
Soil quality is a decisive factor in the assessment of agricultural land. The type of soil, nutrient content, and water retention capacity play an important role. Soils with high nutrient content and good water retention capacity are generally more productive and thus more valuable than soils with low nutrient content or poor water retention capacity. The risk of erosion and long-term yield potential are also important aspects to be considered when assessing soil quality. The assessment of agricultural land requires a deep understanding of these factors.
Location and Infrastructure in Rural Areas
Location and infrastructure in rural areas also play a significant role in the assessment of agricultural land. Good transport connections and low transportation costs are crucial for the economic viability of agricultural use. The availability of water and energy supply can also positively influence the value of agricultural land. Plots close to settlements or industrial areas can have a higher value due to the potential conversion into building land. Therefore, location and infrastructure are important value drivers.
Legal Frameworks and Funding Programmes
The legal frameworks and funding programmes can also significantly affect the value of agricultural land. Land use plans and conservation requirements can restrict usage possibilities and thus reduce value. In contrast, funding programmes for agriculture and rural development can increase value by improving the economic viability of agricultural use. A careful examination of legal frameworks and funding programmes is therefore essential to realistically assess the value of agricultural land.
Methods for Determining Standard Land Values
The determination of standard land values is generally carried out by expert committees composed of professionals in the real estate industry. Various methods are employed to assess the value of the land. The most common methods include the comparison method, the income method, and the cost method. The choice of the appropriate method depends on the specific circumstances and the type of property. The analysis of standard land values is a complex process.
Comparison Method
The comparison method is based on the analysis of sales prices of similar properties in the area. The sales prices of comparable properties are adjusted in consideration of location, size, and condition to determine the value of the property being evaluated. The comparison method is particularly suitable for valuing properties with a sufficient number of comparables. The factors for property evaluation play an important role here.
Income Method
The income method is generally used for the valuation of developed properties, where income generation is the primary focus. The value of the property is capitalised based on the expected income. The calculation takes into account the operating costs and the risks associated with its use. The income method is particularly suitable for valuing rental properties or commercial real estate.
Cost Method
The cost method is generally applied to the valuation of owner-occupied properties or specialised properties where income generation is not the main focus. The value of the property is determined based on the cost of construction. The calculation considers depreciation and impairments. The cost method is particularly suitable for valuing single-family homes or production buildings.
Current Market Trends and Their Impact
Current market trends have a significant impact on standard land values and, consequently, on new construction projects. The rising demand for housing in urban areas, the growing importance of sustainability and ecological aspects, as well as the advancement of digitalisation and the use of new technologies are all factors that can affect standard land values. Therefore, analysing current market trends is essential to estimate the future development of these values. Information about standard land values helps draw the right conclusions.
Rising Demand for Housing in Urban Areas
The rising demand for housing in urban areas is leading to an increase in standard land values in suburban areas and presents great potential for densification and new construction projects. Since city centres are often already densely built, many people are moving to suburban areas, resulting in increased demand and higher land prices. Densification, such as building on vacant lots or adding floors to existing buildings, also offers significant potential to meet the demand for housing in urban areas. Calculating land costs should consider these trends.
Sustainability and Ecological Aspects
The importance of sustainability and ecological aspects is steadily increasing in new construction projects. Builders and investors are increasingly valuing ecological construction methods and resource-efficient land use. Government incentives and support programmes also further the development of sustainable construction projects. As a result, plots suitable for sustainable development tend to achieve higher standard land values. The valuation of agricultural land can serve as a basis here.
Digitalisation and New Technologies
Digitalisation and the use of new technologies are also transforming the real estate sector and property valuation. The use of geographic information systems (GIS) for analysing standard land values allows for more precise and efficient property valuation. Automated valuations and online portals are also becoming increasingly popular as they offer a fast and straightforward way to access current standard land values. The land valuation is supported by digital tools.
Risk Management and Due Diligence in New Construction Projects
In new construction projects, effective risk management and thorough due diligence are essential to identify and minimise potential risks. Environmental impacts and contamination, site risks and geotechnical reports, as well as legal risks and approval procedures can significantly increase construction costs and jeopardise the success of the project. Comprehensive due diligence, including the review of ownership and encumbrances, obtaining reports and expert opinions, and securing insurance and guarantees are therefore indispensable. The valuation of agricultural land can serve as a basis here.
Identifying Potential Risks
Identifying potential risks is the first step towards successful risk management. Environmental impacts and contamination can lead to significant remediation costs and limit the developability of a site. Site risks and geotechnical reports provide insights into the ground conditions and possible risks such as settlements or landslides. Legal risks and approval procedures can cause delays and additional costs. These factors should be considered in the land valuation.
Due Diligence Process
The due diligence process includes a thorough review of ownership and encumbrances, obtaining reports and expert opinions, and securing insurance and guarantees. Reviewing ownership and encumbrances provides insights into possible legal disputes or encumbrances on the property that could restrict its developability. Obtaining reports and expert opinions allows for an informed assessment of environmental impacts, site risks, and legal risks. Securing insurance and guarantees protects against unforeseen costs and risks. The valuation of arable land can serve as a model.
Case Studies and Best Practices
The analysis of case studies and best practices provides valuable insights for future new construction projects. The analysis of success factors and challenges of successful new construction projects in various regions allows for the identification of lessons learned and the derivation of recommendations for future projects. Examples of sustainable and innovative construction projects, which highlight the use of environmentally friendly materials and technologies as well as the consideration of social and ecological aspects, can serve as role models. Information on the standard land value is helpful here.
Successful New Construction Projects in Various Regions
The analysis of successful new construction projects in various regions enables the identification of success factors and challenges and deriving lessons learned for future projects. For instance, the location, infrastructure, construction methods, marketing, and financing of the projects can be analyzed to identify best practices. The challenges encountered during project implementation can also provide valuable insights to avoid similar issues in future projects. The calculation of land costs should take these insights into account.
Examples of Sustainable and Innovative Construction Projects
Examples of sustainable and innovative construction projects, which prioritize the use of environmentally friendly materials and technologies and the consideration of social and ecological aspects, can serve as models for future projects. The use of renewable energies, recycled building materials, the creation of green spaces, and the integration of social facilities into the projects can be analyzed to identify best practices. The evaluation of agricultural land can serve as a basis here.
Conclusion and Outlook
Property reference values play a crucial role in new construction projects. The influencing factors and evaluation methods are diverse and require careful analysis. Future perspectives and trends, particularly the development of property reference values in the coming years, as well as the significance of sustainability and digitalisation, will sustainably transform the real estate industry. A proactive engagement with these topics is therefore essential for successfully realising new construction projects. The analysis of property reference values is an ongoing process.
Summary of Key Insights
The key insights can be summarised as follows: property reference values are an important factor for new construction projects, the influencing factors are diverse and require careful analysis, and the evaluation methods are complex and require expertise. Comprehensive due diligence, effective risk management, and the consideration of sustainability and digitalisation are crucial for the success of new construction projects. It is critical to continually keep an eye on the factors for property valuation.
Future Perspectives and Trends
The future perspectives and trends indicate a growing importance of sustainability and digitalisation. The development of property reference values in the coming years will depend on the demand for housing, economic development, and political conditions. A proactive engagement with these topics is therefore essential to successfully realise new construction projects. The land appraisal will continue to play an important role.
Are you planning a new construction and want to achieve the optimal property reference value for new builds? Auctoa offers you comprehensive advice and support in the valuation of properties and the development of new construction projects. Our experts have many years of experience and in-depth expertise to maximise your investment. Contact us today to learn more about our services and request your individual offer. Register for free and receive an immediate initial estimate for the renovation needs of your property. Get in touch now!
The Landwirtschaftskammer offers detailed information on regional development and its impact on standard land values.
Wikipedia explains soil assessment as an important aspect in the evaluation of properties and standard land values.
What are standard land values and why are they important for new build projects?
Standard land values are average location values of the land, determined by expert committees. They serve as a guideline for property prices and influence the financial feasibility of new build projects.
How do location and infrastructure affect the standard land values for new builds?
The macrolocation (economic significance of the region) and the microlocation (immediate surroundings of the property) significantly influence the standard land values. Good connections to public transport, schools, shopping facilities, and green spaces have a positive impact.
What role does soil condition play in the valuation of land for new builds?
The type and quality of the soil affect the suitability of the land for construction and the load-bearing capacity. Soils with high load-bearing capacity and good drainage are better suited and achieve higher standard land values.
How do legal frameworks impact standard land values?
The development planning law (land use plan, development plan) and environmental regulations (nature conservation requirements, emissions protection) can restrict buildability and thus influence the standard land values.
What methods are used to determine standard land values?
The most common methods are the comparative value method (analysis of sales prices of similar properties), the income value method (capitalization of expected returns), and the cost value method (construction costs minus depreciation).
How do current market trends affect standard land values for new build projects?
The rising demand for housing in urban areas, the increasing importance of sustainability, and the advancing digitalisation affect standard land values and thus new build projects.
What risks should be considered for new build projects?
Environmental impacts, ground risks, legal risks, and approval processes can significantly increase construction costs. Comprehensive due diligence is essential.
How can Auctoa assist in the valuation of land for new build projects?
Auctoa offers comprehensive advice and support in the valuation of land and the development of new build projects to maximise your investment. Contact us for personalised advice.
