C150150 Market Report - Laserfiche WebLink

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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . a property than a similar, substitute property would cost. This approach considers actual sales of similar properties that have occurred in the market place based upon investigation of the buyers, sellers, fInancing, and properties conveyed. Application of the Market Data Approach requires verifIcation, comparison, and rating of the subject property once sales prices are reduced to common denominators. Since no two properties are identical, adjustments must be made to accurately compare other sales to the subject property. This approach is the most direct method for estimating value. The valuation ofreal estate with improvements that add little or nothing to the overall value is best accomplished by the Market Data Approach, that relies on the direct comparison of similar sales. Adjustments are made for various factors that influence value and an overall rating is assigned each property. After fInal analysis, an estimate of value is made. In this report, we conclude that the Market Data Approach is the best means to estimate the value of the Keesee Ditch Water Rights. We have found enough reliable market information to provide a range of values to reflect the water rights' value. We believe this information provides the best indication of value. The general process used in this report was to investigate sales ofland with water rights and sales , of water rights alone. When a sale involved land and water, the sale price was broken down between lands irrigated with surface w~ter, lands irrigated with well water, pasture land, improvements, and any other components of value. To determine the value of surface water to irrigate one acre, the per-acre price of the irrigated land was reduced by the value of the residual dry-up land. The resulting value wa'5 taken to be the value of one acre-foot of irrigation water. The per-acre value for the irrigation water was multiplied by the number of irrigated acres to get the total value of the water. The total value of the water was divided by the average consumptive use of the water right, resulting in a value per acre-foot of consumptive use. After diligent research and investigation of market activity in the area, the authors have completed information on the sales ~t are contained in this report. These sales have been directly compared to the Keesee Ditch Water Rights providing a sound basis to estimate value by the Market Data Approach. Many of the comparable sales in this appraisal involved only shares of stock in mutual ditch companies, including LA WMA. For the sales of shares, the per-share average consumptive use was divided into the per-share cost. This resulted in a value per acre-foot of consumptive use for the water rights purchased. B. The Capitalization of Income Approach Valuation using the Capitalization ofIncome Approach relies on the principle that the value of a property or right is created by the expectation offuture benefits associated with its ownership. These benefIts are generally related to the anticipated net income stream over the remaining useful life of the Page 24 of 66