Land Valuation

According to The State Acquisition and Tenancy Act, 1950 (East Bengal Act) (ACT NO. XXVIII OF 1951) under Section 2(16) “land” means land which is cultivated, uncultivated or covered with water at any time of the year, and includes benefits to arise of land, houses or buildings and also things attached to the earth, or permanently fastened to anything attached to the earth.

Land Record System in Bangladesh

Land record system in Bangladesh comprises preparation and maintenance of Record of Rights (ROR) and registration of land transfer deed. Three sets of documents as output of the system are ROR (Khatian) including mauza-maps, mutated (updated) ROR and registration deed.

Record of Rights (RoR) (Khatiyan)

Record of Rights is document for identifying land. It’s prepared through survey for the purpose of determining possession, ownership and assessing Land Development Tax is known as Khatiyan.  It is also known as Record of Rights, Sottolipi or porcha.

Contents of Khatiyan

Plot No.- partial or complete. Name, father’s name, address of the owner or owners. Portion of a owner, total amount of land, class and nature of land, location, easement right, amount of Land Development Tax payable, mode of paying tax, rights and obligations of the tenants, rent free status etc.

Mouza

Each Upazilla is divided into small plots. These plots are known as mouza. The mouza is given a number. The number is known as mouza number. It is also known as Jurisdiction List (JL) Number.

Mouza again is divided into plots. This number usually begins from north-west point and ends up to the south-east point.  A particular owner or several owners may have several plots. A Khatiyan is opened for a/more complete plot or part of a plot. Hundred Khatiyans are bound together mouza wise. So it may increase in number depending on the Khatiyans. A separate Jott number is also given in tahsil office for payment of Land Development Tax.

Classification of Khatiayan:

Survey/Jareep Khatiyan

Khatiyan is prepared through land survey. This survey is conducted by Land Record and Survey Department situated at Tejgoan. It has Govt. own press to print Khatiyan. Khatiyan are given nomenclature according to the name of the survey i.e. i) CS Khatiyan ii) SA Khatiyan iii) RS Khatiyan iv) BS Khatiyan v) City Jareep vi) Diara Jareep etc.

Mutation Khatiyan

Normally Khatyan is made through Jareep. But Jareep does not always take place. Property may be transferred in-between two jareeps. Then the change of ownership needs to be reflected in the Khatiyan. Such kahtiyan done through mutation proceedings is known as mutation khatiyan. AC Land office does this.

 Classification of “Survey Khatiyan”

C.S. Khatiyan: This khatiyan was prepared under Bengal Tenancy Act 1885. This is known as Cadastral Survey. This survey started from ramu of Cox’s Bazar upazila on 1888 and ends on 1940.

R.S. Khatiyan: After 50 years of CS survey another survey was held on. This survey was known as Revisional Survey and the khatiyan made from this survey is known as RS Khatiyan. The purpose of this survey is to update the amount of land, owner’s name and possessor’s name. It is more authentic than the CS khatiyan.

S.A. Khatiyan: This Khatiyan was prepared under State Acquisition and Tenancy Act 1950. Actually this is not a practical Survey or this is not based on field survey. This khatiyan was made on the information was given by the Zamindar or Landlord. SA khatiyan means State Acquisition khatiyan or Settlement Attestation. It is also known as PS khatiyan or Pakistan Survey Khatiyan. This is not an authentic khatiyan.

BS Khatiyan: This is the more authentic khatiyan than all other khatiyan. A survey was started on 1970 which is continuing till now. This survey is known as Bangladesh Survey and the khatiyan made from BS survey is known as BS Khatiyan or Bangladesh Survey Khatiyan.

How to identify Different types of Khatiyan:

RS Khatiyan:

1. Vertical and it has two pages.

2. The name of the district, Mouja and number of khatiyan is Witten on the top of the first page of this Khatiyan.

3. “According to Section 105/106/108/109…” this is written at the bottom of the first page.

4. “Possessor of north frontier” is the second column of second page.

5. The owners are mentioned in different groups and this groups are marked by Bengali alphabet.

PS Khatiyan:

1. Vertical and it has two pages.

2. The name of the district, Mouja and number of khatiyan is witten on the top of the first page of this Khatiyan. Besides RS Khatiyan number is mentioned over the PS Khatiyan number.

3. “According to Section 49/50/51/52 or 53…” this is written at the bottom of the first page.

BS Khatiyan :

1. Horizontal and it has one page.

2. All Columns are mentioned in the front page of this khatiyan.

Source: Ministry of Land

Calculation of area of land in Bangladesh 

Traditional Methods (Bigha-Katha System):

1 Decimal/Shotangsho (Shotok) = 435.6 Sq Feet/ 48.40 Borgo Gaz (Square Yard)/193.60 Square Hat/40.47 Square Meter/ 1,000 Square Link/ 100 Ojutangsho (approx.)

1 Kattah (Cottah) = 1.65 Shotangsho/165 Ojutangsho/ 720 Sq Feet (approx.)
1 Bigha = 20 Katha/33 Decimal/ (approx.)
4 Kora = 1 Gonda (864 Square Feet), 20 Gonda = 1 Kani (17280 Square Feet), 80 Kora = 1 Kani,

120 Decimal = 1 Kani, 216 Square Feet = 1 Kora, 72 Square Feet = 1 Kransti, 3.6 Square Feet = 1 Til.

1 Chain = 66 Feet, 1 Chain = 100 Link/100 Link = 66 Feet, 1 Shotok/Decimal = 1,000 Square Link.

Bigha is a traditional unit of land measurement widely used in Bangladesh. It varies in size depending on the region and can range from around 0.30 acres to 0.60 acres.

Modern Methods (Metric System):

1 Hector = 10,000 Square meter/11960 Square yard/2.47 Acre/100 Ayer (Approx)

Classification of land

The classification of land can be approached from various perspectives, including its use, physical characteristics, Geological Feature, Legal Status and ownership.

Based on Use:

1. Residential Land: Land used for building houses, apartments, and other residential structures.
2. Commercial Land: Land designated for commercial purposes, such as retail stores, office buildings, hotels, and shopping malls.
3. Industrial Land: Land used for industrial activities, including factories, warehouses, manufacturing plants, and distribution centers.
4. Agricultural Land: Land used for farming, crop cultivation, livestock grazing, orchards, and other agricultural activities.
5. Recreational Land: Land designated for recreational purposes, such as parks, playgrounds, sports fields, and open spaces.
6. Mixed-Use Land: Land zoned for multiple purposes, combining residential, commercial, and/or industrial uses within the same area or development.

7. Transportation Land: Land used for transportation infrastructure, including roads, highways, railways, airports, ports, and terminals.

8. Institutional Land: Land used for institutional purposes, such as schools, hospitals, government buildings, religious institutions, and community centers.

Based on Physical Characteristics:

1. Urban Land: Land located within cities and urban areas, typically characterized by high population density, infrastructure development, and commercial activities.
2. Rural Land: Land located in rural areas and countryside, often used for agriculture, forestry, and rural settlements.
3. Suburban Land: Land situated on the outskirts of urban areas, offering a mix of residential, commercial, and open space amenities.
4. Waterfront Land: Land located adjacent to bodies of water such as rivers, lakes, oceans, or seas, offering scenic views and recreational opportunities.
5. Forest Land: Land covered by forests and woodlands, containing diverse flora and fauna and providing ecosystem services such as carbon sequestration and biodiversity conservation.

Based on Geological Features:

1. Flat Land: Land with relatively low relief and minimal elevation changes, suitable for agriculture, urban development, and infrastructure projects.
2. Hilly Land: Land with gentle to moderate slopes and undulating terrain, offering scenic views and agricultural opportunities.
3. Coastal Land: Land located along coastlines and shorelines, subject to tidal influences, erosion, and marine ecosystems.
4. Mountainous Land: Land characterized by steep slopes, rugged terrain, and high elevation, often found in mountain ranges and elevated regions.
5. Wetland: Land characterized by saturated or seasonally inundated soil conditions, supporting unique wetland ecosystems and biodiversity.

Based on Legal Status:

1. Public Land: Land owned and managed by government entities often designated for public use, conservation, or resource management.
2. Private Land: Land owned by individuals, corporations, or organizations, typically used for residential, commercial, or agricultural purposes.
3. Common Land: Land held in common ownership or shared use by multiple individuals or communities, often subject to specific rights, regulations, and management practices.

Based on Ownership:

4. Freehold Land: Land owned outright by an individual or entity, with full rights to use, transfer, and develop the property indefinitely.
5. Leasehold Land: Land held under a lease agreement, where the lessee has temporary rights to use and occupy the property for a specified period, subject to lease terms and conditions.
6. Tenure Land: Land held under various forms of land tenure systems, including customary, communal, or tribal tenure, with rights and responsibilities determined by local customs and traditions.

Land is life for billions of people worldwide, sustaining economic activities, social identity, ecological and cultural value and often the collective sense of justice.

Purposes of Land Valuation:

1. Real Estate Transactions: Assisting buyers and sellers in negotiating fair prices.
2. Mortgage Lending: Determining the collateral value for loan purposes.
3. Investment Analysis: Evaluating the potential return on investment.
4. Taxation: Assessing property taxes based on land value.
5. Legal Disputes: Providing evidence as expert witness in cases of divorce settlements, equitable distribution, inheritance disputes, or partitioning of land.
6. Financial Reporting: Recording the value of land in financial statements.
7. Tourist/Student/Investor Visa Support: Valuing immigration for visa support, business migration, and investor visas involves recognizing their significant contributions to economic growth, innovation, and cultural enrichment.

Key Factors Influencing Land Value:

1. Location:

Proximity to Amenities: Land located near schools, shopping centers, hospitals, parks, and other amenities tends to have higher value due to convenience.

Accessibility: Easy access to major roads, highways, public transportation, and airports enhances land value.

Neighborhood Quality: The overall quality and safety of the neighborhood impact land value, with well-maintained, low-crime areas being more desirable.

2. Land Size and Shape: Plots size and shapes influence to determine the value. Regularly shaped plots (e.g., rectangular) are generally more usable and thus more valuable than irregularly shaped plots.
3. Zoning and Land Use Regulations:

Zoning Laws: These determine what activities can be performed on the land (e.g., residential, commercial, industrial). Land with more flexible zoning or favorable zoning for high-demand uses typically has higher value.

Permitted Uses: The specific uses allowed under the zoning regulations can greatly influence land value. For instance, land zoned for high-density residential or commercial use is often more valuable than land zoned for low-density residential use.

4. Topography and Soil Quality: Flat land is usually more valuable because it is easier and less expensive to build on compared to hilly or uneven terrain. Fertile soil is crucial for agricultural land and impacts its value. Poor soil conditions can also increase construction costs for residential or commercial developments.
5. Utilities and Infrastructure: Access to essential services such as water, electricity, gas, sewage, and internet increases land value. Proximity to well-developed infrastructure such as roads, bridges, public transport, rail ways and airports enhances land value.
6. Market Demand and Supply: High demand for land in a particular area, driven by factors such as population growth and economic development, increases land value.
7. Economic Conditions: The overall economic climate, including employment rates, income levels, and economic growth, impacts land value. Higher interest rates can decrease land value by making financing more expensive, thereby reducing demand.
8. Legal Factors: Clear & undisputed land titles increase value, whereas disputed titles or complicated ownership histories can decrease value.
9. Development Potential: The potential for future development or redevelopment can significantly increase land value. This includes planned infrastructure projects, new zoning regulations, or economic development initiatives. Development of adjacent properties also enhances the value of land, especially if it involves high-end residential, commercial, or recreational projects.
10. Social and Demographic Factors: Areas with growing populations tend to see increased land values due to higher demand for housing, services, and infrastructure.
11. Historical and Cultural Factors: Land with historical or cultural significance can have higher value due to its uniqueness and potential for tourism. Just like that land protected for heritage reasons may have restrictions that influence its value positively or negatively depending on potential uses.
12. Environmental Factors: Clean air, water, and a healthy environment enhance land value, whereas pollution and environmental degradation such as floods, earthquakes reduce it.

Valuation Methods:

1. Sales Comparison Approach (Market Approach):

This method involves comparing the land in question to similar properties (comparable or comps) that have recently been sold in the same area. Find recently sold properties that are similar in size, location, and use. Adjust the sale prices of the comparable for any differences (e.g., size, location, amenities) to make them comparable to the subject property. Use the adjusted prices to estimate the value of the subject property.

2. Income Approach:

This method values land based on its potential to generate income, typically used for commercial properties. Determine the potential rental income the land can generate. Subtract any operating expenses from the potential income. Divide the net income by an appropriate capitalization rate to estimate the land’s value.

3. Cost Approach:

This method is based on the cost of developing the land to its highest and best use, minus any depreciation. Calculate the cost to replace or reproduce any improvements on the land.

4. Residual Method:

This method is used for land with development potential, focusing on the value of the land after considering the costs and profits of the proposed development. Determine the value of the land after development, all costs associated with developing the land, including construction, financing, marketing and reasonable profit margin for the developer. The remaining amount is the residual value of the land.

5. Allocation Method:

This method involves estimating the value of the land by separating the value of the improvements from the overall property value. Estimate the market value of the entire property (land and improvements). Calculate the cost or value of the existing improvements. Subtract the improvement value from the total property value. Often used when it is difficult to find comparable sales for vacant land.

Valuation Process:

1. Defining the Purpose and Scope:

Clarifying the reason for valuation and the specific aspects to be assessed.

2. Data Collection:

Gathering information on the land, including physical characteristics, legal status, and market data.

3. Site Inspection:

Visiting the land to assess its condition, surroundings, and any improvements.

4. Applying Valuation Methods:

Utilizing appropriate valuation methods based on the land’s characteristics and the purpose of the valuation.

5. Analysis and Reconciliation:

Analyzing the results from different methods and reconciling them to arrive at a final value estimate.

6. Reporting:

Documenting the valuation process, findings, and final value in a comprehensive report.

Land Valuation Challenges in Bangladesh:

1. Lack of Comparable Data: finding similar properties for comparison.
2. Market Volatility: Rapid changes in market conditions affecting value.
3. Regulatory Changes: Changes in zoning laws or land use regulations impacting value.
4. Lack of dependency: Difficulty in assessing value independently.   
5. Environmental Issues: Assessing the impact of environmental factors on land value.

Conclusion:

Land valuation is a critical process that requires a thorough understanding of various factors and methodologies. Accurate land valuation ensures fair transactions and informed decision-making for buyers, sellers, investors, lenders, and policymakers. By employing appropriate valuation methods and considering all relevant factors, valuers can provide reliable and credible estimates of land value.