Value In Use | Propertylogy

Value In Use

By on November 15, 2018

Value in use refers to the value of a particular property based on how it is being used.

It is often used in comparison to the market value at it’s highest potential.

For example, a gas station allowed to remain in business in a district that no longer approved licenses for them can be high in value as there are no competitors in the area.

In this case the value in use can be comparatively high.

However, a single family house situated in major commercial district will have a low value in use as it can be potentially worth more if the land is used for commercial space instead.

In this case, the best use of the property would be a retail or commercial space.

It is for this reason why many developers and heavy hitters in real estate investments seek out real estate with a low value in use. It is so that they can maximize the potential value of the property and make capital gains.


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