Land values to be based on market

New land valuations to be announced starting next year will be based on market price data as well as projections of economic growth and inflation rates.

The goal is to ensure that values represent as closely as possible actual market conditions, according to Amnuay Preemanawong, the deputy director-general of the Treasury Department.

Land valuations set by the Treasury Department and the Land Department are used as a baseline not only for market transactions, but also for tax purposes and collateral assessments by local financial institutions.

Valuations are revised every four years on a nationwide basis, with the newest values to take effect from 2008 through 2011.

The Treasury Department, which manages public lands on behalf of the government, is responsible for carrying out the valuation survey.

For the new survey, the department has split its work into three phases.

First it will revise values for land plots that are already in state databases, based on the most recent transaction data for nearby properties as well as economic data over the previous three years.

Second, it will assign valuations for 400,000 plots for the first time, mostly representing sites in Surin, Chiang Rai and Buri Ram provinces. The third phase will involve assessing values based on wholesale blocks.

Ultimately, the department hopes to compile a nationwide database with price and geographic information both for individual plots as well as broader blocks.

The initial survey is expected to be completed in July, after which the department will meet with provincial working groups to finalise the data starting from August.

Mr Amnuay said the new valuations would not necessarily result in increases in all jurisdictions, particularly in provincial areas.

The department tracks 28 million land plots nationwide, of which two million are located in Bangkok.

All land in Bangkok has already been classified on a plot basis, whereas most provinces still have valuations based on block zones.

Valuations in some areas, such as Silom and Yaowarat roads in Bangkok, typically post little change from one survey to the next, due in part to the relatively few transactions registered in the market.

As a result, official valuations in some of the most valuable areas of Bangkok are listed at around 600,000 baht per square wah, even though private valuers would assign values of up to one million baht for the same plot.

For areas with relatively few market transactions to serve as a baseline, the Treasury Department will turn to other indices to assess land values, such as rental and lease rates for an area and values attached to similar plots in the area.

Under the current valuation schedule, first used in 2004 and set to expire this year, the highest values have been assigned to properties along Silom Road, at 340,000 to 600,000 baht per square wah.

Yaowarat Road in Chinatown is valued at 260,000 to 510,000 baht per square wah, and Thaniya Road off Rama IV is valued at 340,000 to 510,000 baht.

The public can obtain information on the valuation process, including data for individual plots, on the Treasury Department website: http://www.treasury.go.th
Bangkok Post Feb 06

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