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mixed use of agriculture, including timber, cow, and hog farming,
and recreation, including hunting.
To value DP, he used the sales comparison approach (also
referred to as the comparative sales approach). A sales
comparison approach relies on recent sales of comparable
properties to determine the value of the subject property. Mr.
Middleton performed two separate analyses, one with respect to
the main tract and a second with respect to the five smaller
tracts.
In comparing DP’s main tract to other tracts recently sold,
Mr. Middleton subtracted the value of any improvements, such as
the value of a house or other erected structures, and the
merchantable timber on DP. In addition, he made adjustments for
the size, waterfront access, and location and the period between
the sale date and the valuation date. He identified sales of six
comparable properties to value DP’s main tract; however, he
accorded greater weight to three given their geographic
similarities to DP. Mr. Middleton concluded that the value of
DP’s largest tract on the valuation date was $1,275 per acre, for
a total value of $2,500,275 (1,961 acres x $1,275 per acre). He
rounded this to $2.5 million.
To value the five separate small tracts he again identified
sales of six comparable properties. Because each tract was
different in size and had different attributes, such as road
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Last modified: May 25, 2011