How to assess the impact of hope on a change in the use of land on market value?

• Drapikovskyi, Oleksandr ^[2] ; Ivanova, Iryna ^[2] ; Renigier-Biłozor, Małgorzata ^[1] ; Źróbek, Sabina ^[1]
  1. [1] University of Warmia and Mazury in Olsztyn

     University of Warmia and Mazury in Olsztyn

     Olsztyn, Polonia

     
  2. [2] Centre of Urban Land Use Management and Economics, Kyiv, Ukraine
• Localización: Land use policy: The International Journal Covering All Aspects of Land Use, ISSN 0264-8377, ISSN-e 1873-5754, Nº. 97, 2020
• Idioma: inglés
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• Resumen

  • This article is devoted to common yet quite specific approaches to valuation practice tasks that are involved in determining the market value of real properties in areas of possible land use changes. An intrinsic element of market value in such areas is the hope value, for which an option pricing model is used quite frequently. The authors propose a specially adapted Samuelson-McKean model for this task, which allows market value indication to be determined not only with the built-in development option, but also the dynamics of its components value in the current highest and best use and hope value – depending on the location of the given property. The greatest advantage of the Samuelson-McKean model is that it can be treated as universal for analyzing the range of possible indications of market value seeing as how its main task is to find a compromise between the interests of the buyer and the seller, which is the goal of any fair transactions and decisions.