Valuation, depreciation and the rate base

Bibliographic data

Monograph

Identifikator:: 174667931X

URN:: urn:nbn:de:zbw-retromon-119897

Document type:: Monograph

Author:: Grunsky, Carl Ewald http://d-nb.info/gnd/10180959X

Title:: Valuation, depreciation and the rate base

Edition:: 2. ed., revised and extended

Place of publication:: New York

Publisher:: Wiley

Year of publication:: 1927

Scope:: X, 500 Seiten

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter X. Notes on the determination of the value of real estate in eminent domain proceedings and for rate-fixing purposes

Collection:: Economics Books

DETERMINATION OF THE VALUE OF REAL ESTATE 203 seeks to condemn the property, as in the case of land required by the Government for fortification purposes, or for a light house, but in all cases where the adaptability to the special use is recognized and the property can be applied to that use by any one suitably circumstanced, the evidence relating to the effect of such adaptability upon market value should be admissi- ble. It should be admitted even though somewhat speculative. The court must determine what weight to give to evidence of value for special uses which only remotely affect the market value. In the case of a mine on land whose surface has value for no other purpose than grazing, it will, unquestionably, be proper to ascertain the value of the land for the special purpose of min- ing. If the land has value for mining and at the same time for reservoir purposes or as a dam site, there should be no objection to a consideration of these values separately for each specific purpose, just as the same would be considered by the prudent purchaser when he makes a study of market value. The con- sideration of the effect of availability for these purposes upon market value is not to be classed as too speculative. If use for any such purpose lies in the future, due allowance must be made for the lapse of time before the ultimate value resulting from that use can be realized. If the time is uncertain and remote, the effect of the special adaptability upon market value will be small when compared with what this effect might be if immediate use were a certainty. The Value Multiple. — Other considerations, too, may limit this market value. It has, for example, become a practice, almost standard, to value rights of way for railroads and high- ways at from 1.5 to 3.0 times the market value of adjacent lands of similar character. Custom has given land required for such uses such values. There are no frequent transfers of such property as in the case of town lots or farms. Consequently the determination of the value multiple which may be regarded as generally customary in the region where a right of way is to be valued may be the best guide in fixing this value.

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