Expert Criticizes Simplistic Land Valuation Methods on YouTube, Advocates for Rigorous Assessment

Lars Doucet, a prominent Georgist economist and founder of ValueBase, recently highlighted the alarming prevalence of overly simplistic land valuation advice on platforms like YouTube. Doucet's observations, shared via a tweet, point to a significant gap between professional appraisal standards and the casual guidance often found online, exemplified by a "20% rule" for valuing land. This critique underscores the need for more sophisticated and accurate methodologies in property assessment.

"If you look for youtube explainers on 'How to value land' you literally get videos like: 'Hey there, this is Real Estate King. Here's an in depth tutorial on how we value land when we put bids on it. So we take all the improved sales nearby and we apply 20%. Bam, done.'," Doucet stated in his social media post. Such advice, he implies, drastically oversimplifies a complex economic process that has profound implications for taxation and urban development.

Doucet, known for his work on property taxes and his book "Land is a Big Deal," argues that accurate land valuation is fundamental for equitable taxation and efficient land use. He emphasizes that land value is distinct from improvements on it, like buildings, and that its assessment requires detailed analysis, often involving Geographic Information Systems (GIS), comparable sales data, and advanced statistical models. Simplified rules risk misrepresenting true market value, leading to unfair tax burdens and disincentivizing productive development.

His startup, ValueBase, aims to modernize municipal mass appraisal by partnering with local governments to implement more accurate, efficient, and transparent assessment methods. Doucet notes that many existing appraisal offices still rely on outdated practices, contributing to inaccuracies where, for instance, commercial properties might be under-assessed relative to residential ones. He advocates for open-source models and data to allow public scrutiny and ensure fairness.

The economist's commentary comes amidst ongoing discussions about property tax reform and housing affordability. Accurate land valuation is crucial for implementing policies like a land value tax, which economists widely support as a less distortionary form of taxation. Doucet's call for rigor challenges the casual approach to valuation and advocates for a data-driven understanding of land's economic role.