Land Value Vs. Sale Price
I am interested in purchasing some land for sale in an upscale neighborhood. The realtor is asking 175k for the lot. 93'x83' steep slope and heavily wooded. I checked out the Auditors page and the land value listed is 85k. I then checked other lots in the same area and other realtors are selling for similar prices. 174k, 200k and so forth. How do they figure the selling price vs. the land value listed by the auditor? 100k mark up seems like an awful lot to me.
I'm assuming by "auditor's price" you mean the assessed value of the land. This has absolutely nothing to do with the FMV. Normally, towns re-assess their real estate every 5-10 years, and then factor the assessment amount yearly to update it for inflation, market conditions, etc. In hot markets, this doesn't always keep up with market pricing.
It "could" serve as a relative reference, however. If one lot is assessed at $50k, and another at $100k, you can be fairly sure that the higher priced lot will "probably" sell for about twice what the lower priced lot does.
Bob
Concerning land values v. sale values...The real value of the land in my area (PA) isn't determined by assessment. It's determined by what the buyer can do with it. In other words, the sale value of the end product, like a house. I use rules of thumb to estimate land value after determining what the house on its lot should sell for.