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Compulsory Auction Property
An estate in a foreclosure auction can be an attractive opportunity to acquire land at a favourable price. But caution is advised! The matter is complex and carries risks. Would you like to learn more about the valuation and the associated challenges? Read more in our article on property valuation and seek advice.
The standard land value is an important point of reference when it comes to the compulsory auction of a property, but it should never be used as the sole basis for decision-making.
A comprehensive evaluation taking into account liabilities, location, and market dynamics is crucial to minimise risks and make optimal use of the value enhancement potential. A reduction in the purchase price of up to 15% compared to the market value is realistic.
Use online portals and expert committees to obtain detailed information, and pay attention to regional differences in data availability to make informed decisions.
A compulsory auction property can be both an attractive opportunity for acquiring real estate and a risky undertaking. The standard land value plays a central role as it provides an initial estimate of the property's value. However, it is important to understand that the standard land value is merely a guideline and does not reflect the actual market value. This article highlights the significance of the standard land value in the context of compulsory auctions and shows you how to minimise risks and make the most of opportunities.
The importance of the standard land value in the context of compulsory auctions
The standard land value serves as an initial guide for assessing a property's value within a compulsory auction. It helps you get a sense of the potential value before obtaining more detailed evaluations. It is advisable to inform yourself in advance about the standard land values in Leipzig to gain a better understanding of the local real estate market. The standard land value is particularly useful for determining the value of building land.
Distinction: Standard land value vs. market value
It's crucial to understand that the standard land value alone is not sufficient to determine the actual value of a property. The standard land value is an average and does not take into account individual characteristics such as contaminated sites or the condition of a building. The market value, which is determined through an expert appraisal, is crucial for the compulsory auction property as it considers all relevant factors. Therefore, a professional real estate valuation is essential for making informed decisions.
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To accurately assess the standardised land value in the context of a compulsory auction, it is important to understand its definition and the basis for its determination. The standardised land value is an official reference value calculated by expert committees and serves as a basis for taxation and property valuation. It is derived from collections of purchase prices, taking into account various value-determining characteristics. The Wikipedia page on standardised land value provides a good overview of this.
What is the standardised land value?
The standardised land value is an average locational value of the land per square metre, determined by expert committees. It serves as a basis for taxing land and as a guideline for property valuation. It is important to note that the standardised land value is an average value and does not reflect the actual value of an individual plot. The definition of standardised land value on tc.de provides further details.
The determination process by expert committees
Expert committees determine the standardised land values based on purchase price collections. They analyse notarised sales contracts from the preceding period. If there are not enough purchase prices available, other factors are considered, such as estimated values. These estimates take detailed factors into account, such as soil quality, locational characteristics, environmental influences, and even solar radiation. The calculation of standardised land value is described in detail on exporo.de.
Factors influencing the standardised land value
Various factors influence the standardised land value, including the type of building usage, the soil quality, the shape and size of the plot, as well as location, infrastructure, development and future potential. The presence of contaminated sites can significantly reduce the standardised land value. These factors are considered by expert committees when determining the standardised land values.
When assessing a property during a forced auction, it is important to understand the differences between land reference value, land value, and property price. The land reference value serves as a reference point, the land value is calculated from it, and the actual property price can vary significantly. These differences are crucial for making realistic bids and recognising potential risks.
Clear distinction of terms
The land reference value is a benchmark that serves as a starting point but does not reflect the actual price. It is an average value for a particular zone and does not take into account specific characteristics of a property. The land reference value as a reference point is explained on immowelt.de.
Land value as a product of the land reference value
The land value is calculated by multiplying the land reference value by the property area. This calculation provides the basis for valuation, yet, again, the actual property price can differ. Notary fees when purchasing property should also be factored into the calculation.
The actual property price: Significant deviations possible
The actual property price can deviate significantly from the land value due to individual factors and negotiations. Special characteristics of the property, such as location (micro and macro location), soil condition (contaminated sites), or building possibilities influence the price. The buyer's negotiation skills and the current market situation also play a role.
The role of the standard land value differs depending on whether it is a developed or undeveloped plot. For undeveloped plots, the standard land value serves as a solid foundation for valuation, whereas for developed plots it is merely a guideline. In both cases, however, a detailed analysis of the specific characteristics of the plot is necessary to determine the actual value.
Undeveloped Plots: Solid Foundation for Valuation
For undeveloped plots, the standard land value acts as a starting point for valuation. However, it must be adjusted to the specific characteristics of the plot, such as shape, size, and location. Water rights regulations can also play a role. The standard land value for an undeveloped plot is calculated as if the plot were not developed.
Developed Plots: Merely a Guideline
For developed plots, a more complex valuation is required. Here, the standard land value serves only as a guideline, as the condition of the building, the building substance, potential demolition costs, and renovation needs must also be considered. A market value appraisal is essential to determine the actual value. It is important to note that the standard land value for a developed plot is calculated as if the plot were undeveloped.
Special Case: Properties Ready for Demolition
For properties ready for demolition, the costs of demolition must be taken into account. The standard land value must be reduced by the demolition costs to determine the actual value of the plot. It is advisable to obtain an expert opinion to precisely determine the demolition costs. The possibility of finding a plot for a tiny house can also influence the value.
The determination of standard land values is governed by legal frameworks and data sources. The Ordinance on the Valuation of Real Estate (ImmoWertV) regulates the determination of standard land values nationwide, while the Standard Land Value Information System (BORIS) provides cross-state data. It is important to be aware of these frameworks and data sources to correctly interpret the standard land values.
Ordinance on the Valuation of Real Estate (ImmoWertV)
The ImmoWertV regulates the determination of standard land values nationwide. It was last amended on 01.01.2022, so it is important to observe the current regulations. The ImmoWertV specifies how expert committees determine the standard land values and which factors must be taken into account in this process.
Standard Land Value Information Systems (BORIS)
The Standard Land Value Information System (BORIS) provides an initial overview of standard land values in Germany. It is cross-state, but more detailed data are often available on the state pages. It is important to note that not all federal states have implemented the BORIS portal. The BORIS data offers a good initial orientation.
Regional Differences and Peculiarities
The handling and availability of standard land values can vary depending on the federal state. There are differences in data presentation and granularity. Therefore, it is advisable to consult the state pages of the expert committees to obtain detailed data. For example, the City of Munich provides its own information on standard land values.
When it comes to foreclosure auctions, there are several pitfalls and challenges to consider. These include contaminated sites, time delays, and current market dynamics. These factors can significantly affect the value of a property and should therefore be taken into account during assessment.
Contaminated Sites (Soil Contamination)
Contaminated sites, or soil contaminations, can significantly reduce the value of a property. The responsibility for classifying contaminated sites lies with district regions or local authorities. It is important to be informed in advance about potential contaminated sites, as the remediation costs can greatly reduce the value of the property. The devaluation due to contaminated sites is a crucial factor.
Time Delays and Market Dynamics
Standard land values often lag behind the current market developments. They are retrospective values and do not reflect the current market situation. Caution is especially advised in times of rapidly rising prices. It is advisable to also be informed about current market developments in order to make realistic bids.
Tax Implications
The role of the standard land value in property tax varies by state. Some states mandate the inclusion of the standard land value in tax returns, while others do not. It is important to be aware of the tax implications as they can affect the value of the property. The property tax reform may also have an impact.
The practical application of the standard ground value in forced auctions requires the consideration of various factors, such as the micro and macro location, the development, and individual characteristics. These factors can significantly influence the value of a property and should therefore be taken into account in the evaluation.
The importance of micro and macro location
The exact location of the property (micro and macro location) significantly influences its value. The infrastructure, surroundings, and proximity to important facilities play a role. A property in a good location is generally more valuable than one in a poor location. The importance of location is highlighted on immowelt.de.
Standard ground value for developed properties
The standard ground value for a developed property is calculated as if the property were undeveloped. This means that the value of the building is not considered. It is important to bear this in mind when assessing a developed property. The application of the standard ground value is explained on exporo.de.
Individual characteristics and their consideration
Every property has individual characteristics that need to be considered in the evaluation. These include, for example, layout, additional rights, and encumbrances. It is important to identify these characteristics and consider their impact on the property's value.
Gathering information is an important step when preparing for a foreclosure auction. There are various online portals and committees that provide information about standard land values. It's crucial to utilise these data sources, while also being mindful of potential hurdles when accessing the data.
Online Portals and Data Sources
There are various online portals offering information on standard land values. These include, for example, BORIS-D and the regional portals of the committees. It's important to consider regional differences and choose data sources carefully. The online availability is described on Wikipedia.
Committees as Contacts
The committees provide detailed information on standard land values, often for a fee. They are direct contacts and can answer individual questions. It is advisable to contact the committees directly to obtain detailed information. The committees in Leipzig, for example, offer detailed information.
Hurdles in Data Access
Hurdles can arise when accessing data. It is important to consider the terms of use and avoid automated access (scraping). Some data sources may not be freely accessible or may require registration. It is advisable to inform yourself about the access conditions in advance.
The Bodenrichtwert is a useful tool in the foreclosure of a property, but it is not the only factor that must be considered in the assessment. It provides an initial guide, but it does not replace a professional evaluation. It is important to take all relevant factors into account to make informed decisions.
Summary of Key Points
The Bodenrichtwert provides an initial guide, but it does not replace a professional evaluation. It is important to consider all relevant factors to make informed decisions. These include, for instance, the location, the development, contaminated sites, and the current market situation.
Outlook for the Future
Digitisation and improved data availability will increase transparency. In the future, Bodenrichtwerte are likely to be even more precise and up-to-date. It is important to keep an eye on developments and take advantage of new opportunities.
With a multitude of factors, there are numerous ways to reduce costs. Enter offers you comprehensive advice and support.
Now is the perfect time to explore the possibilities for your project. Contact us today to start your personalised consultation. Register for free and get an immediate initial estimate for your property.
On the Stadt Leipzig page, you will find information about standard land values in Leipzig.
The Wikipedia provides a general overview on the topic of standard land values.
The Bundesministerium der Finanzen informs about the property tax reform and its implications.
The Stadt München offers specific information on standard land values in Munich.
What is the standard land value and what role does it play in foreclosure auctions of properties?
The standard land value is an average locational value of the land per square metre, determined by appraisal committees. It serves as an initial guideline for assessing a property during a foreclosure auction, but it is not the actual market value.
How does the standard land value differ from the market value of a property?
The standard land value is an average value and does not take into account individual characteristics such as contamination or the condition of a building. The market value, determined through an appraisal, considers all relevant factors and is crucial for the foreclosure auction.
Where can I find current standard land values for properties in my area?
Standard land values are available online through the federal states' land value information systems (BORIS) or directly from the appraisal committees. The availability and level of detail may vary regionally.
What factors influence the standard land value of a property?
Various factors influence the standard land value, including the type of structural use, the soil quality, the shape and size of the property, as well as location, infrastructure, access, and development potential.
How should I proceed if I wish to purchase a property with contamination at a foreclosure auction?
Investigate potential contamination in advance, as the costs of remediation can significantly reduce the property's value. Responsibility for classification lies with district regions or county offices.
How do micro and macro location affect the value of a property at a foreclosure auction?
The exact location of the property (micro and macro location) significantly affects the value. Infrastructure, surroundings, and proximity to important facilities play a role.
What is the ImmoWertV and what significance does it have for the determination of standard land values?
The Real Estate Valuation Ordinance (ImmoWertV) regulates the determination of standard land values nationwide. It specifies how the appraisal committees must determine the standard land values and what factors they must consider in doing so.
How up-to-date are the published standard land values and how do I account for market dynamics?
Standard land values often lag behind current market developments. They are retrospective values and do not reflect the current market situation. Additionally, keep informed about current market developments.
