How to calculate the value of land

Calculating the value of a land is much easier than that of a home. He thinks that real estate buyers -often- do not estimate the improvements or remodeling of apartments and houses, since they may want to adapt the property to their decorative style and rhythm of life. Therefore, even if you have renovated your home, you could get less money than expected.

This does not happen in the case of land. While some buyers value the qualification of the land more highly – a field suitable for cocoa may be more expensive than one for tubers – the lots are blank canvases and can be used for different uses, from the construction of shopping centers to the sale of estate.

But how much is a piece of land worth? The price will depend on its location, the square meters, the surroundings, the number of communication routes and, of course, its characteristics. So, before you sell your lot, learn to calculate its price! In this way you can get the most out of your investment.

First, estimate the cadastral value of the land

If you have land in Mexico, the first step in calculating its price is to estimate the cadastral value. This is nothing more than the declaration of the price of the lot before the organs and entities of the State, and must be done on any type of real estate; be it a land, a house or a commercial premises.

Property taxes are determined according to the cadastral value of the land. Therefore, knowing this figure will give you an idea of ​​the minimum price you should receive for your property. To calculate the price of land according to the cadastral value you will have to have certain data at hand, such as the value of the land and the value of the construction. These data are updated every year and vary between 10% and 25% depending on the adjustments made by the urban office.

The formula to calculate the cadastral value is simple. The value of the land will depend on the location and classification of the land. For example, if the lot is in Mexico City, look for the CDMX tax code table of values. Remember that each entity has its own estimates.

Formula of the cadastral value of the land = value of the land + value of the construction

Let’s take an example. To begin with the calculation of the cadastral value, obtain the number of your property account. Suppose this number is 160-540-90-00. The first figure corresponds to the region according to cadastre, the second to the area and the third to the lot. Look up the figures in the tax code and you will find the average value per square meter.

If the land does not have buildings, then you will not need any extra data. Suppose that the average value of the square meter is $ 5,000 pesos and your lot is 300 square meters. Multiply the average value by the number of meters and you will obtain the cadastral value of your land: $ 1,500,000 pesos.

Land value: analyze the real estate market

The cadastral value of the land will give you an idea of ​​the minimum price you could receive if you sell it, but it does not necessarily determine the price or value of a land on the market. To find out how much a piece of land is priced at, you have to assess how much buyers are willing to pay for it.

To give you an idea, the price of land per square meter that is handled in CDMX is around $ 19,000 pesos, while one in Guadalajara does not exceed $ 5,000 pesos. The city’s growth potential, public services, roads, business development, and capital gains are just a few of the many values ​​that land appraisers take into consideration.

To discover how much a piece of land is worth in the market, you must visit the most popular real estate portals in Mexico. Limit yourself to the areas near your lot and average the value of the posts.

Hire an appraiser to find out the price of a piece of land

To be more sure of the price of land, hire a valuation. Real estate companies have experienced appraisers who will take into account everything that adds or detracts from your property.

You do not need to list your land with a real estate agent for sale. As with pawn shops, these types of companies offer free, no-obligation appraisals.

Thus, you will know exactly how much a piece of land is worth and, when it comes to selling it, you will be able to obtain a fair price for it.