GROUND RENT A SOCIAL PRODUCT 17
Deducting from the total of prices indicated by the
footing of the 120 sales .... $7,291,375
Four-thirds of assessed valuation of buildings . 2,772,933
Would give perhaps a fair estimate of what the
land sold for ...... $4,518,442
To this it is necessary to add the capitalised tax
upon the land for the same year, 1900,
$3,758,600 x $14.70 (the number of dollars
tax per thousand) x 20 (the number of years’
purchase) ...... $1,105,028
In order to get the gross capitalised ground rental .
value of the land ..... $5,623,470
From above it appears that the assessed valuations
were only five-sixths of the selling value and twothirds
of the gross value.
The figures for 751 rentals of estates were also obtained
from reliable sources and are exhibited in Appendix
H, and from these figures it appears that the assessed
valuation of the land ($23,067,800) is five-sixths of the
gross value ($31,548,500), as compared with two-thirds
obtained from the first set of figures. It is probable, however,
that these 751 estates are in the aggregate improved
to less than one-half of their normal efficiency, and
hence the gross income which the land now yields
may be considerably less than the true ground rental.
If so, then, the gross value of the land, namely, the
ground rental capitalized at 5%, is considerably greater
than is shown by the figures, and the assessed valuation,
therefore, may well be only two-thirds of this gross value
and five-sixths of the selling value as in the former case.
In the absence of contradictory or correcting testimony
it is fair to ask the reader to accept these lists
of 120 sales and 751 estate rentals respectively as an
indication that a ratio of five-sixths exists between
assessed valuation and selling value.
