Subdivision
The division of a parcel into multiple lots, or the resulting development. Subdivision potential is a highest and best use question; valuing proposed subdivisions involves discounted sell-out analysis.
Related Terms
Plat
A recorded map of a subdivision showing lots, blocks, streets, and easements.
Highest and Best Use
HBUThe reasonably probable use of a property that results in the highest value, considering uses that are legally permissible, physically possible, financially feasible, and maximally productive..
Excess Land
Land that is not needed to support the existing improvements' highest and best use and can be separated and sold independently.
More in Land & Site Valuation
View allAllocation Method
A land valuation technique that estimates land value by applying the typical ratio of land value to total property value observed in the market.
Extraction Method
A land valuation technique that estimates land value by subtracting the depreciated cost of improvements from the total sale price of an improved property.
Land Residual Technique
A land valuation method that estimates land value by capitalizing the net income remaining after deducting the return attributable to the improvements from the property's total net operating income..
Ground Rent Capitalization
A land valuation method that estimates land value by capitalizing the ground rent (the rent paid for the use of land only, without improvements) at an appropriate capitalization rate..