Property Valuation
In the cost approach, the appraiser estimates land value separately from building value because:
ALand and buildings are taxed at different rates in Mississippi
BLand does not depreciate while buildings do; separating them allows accurate depreciation measurement of the improvement value only✓ Correct
CUSPAP requires separate land appraisals
DLenders require land value disclosure for insurance purposes
Explanation
In the cost approach, land is valued separately using the sales comparison approach because land does not depreciate — it has no physical deterioration, functional obsolescence, or external obsolescence in the same way buildings do. The improvement's depreciated cost is then added to land value to estimate total property value.
Related Mississippi Property Valuation Questions
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