Land Utilization and Rental Value of Real Estate PDF

**Unit 3: Land Utilization and the Rental Value of Real Estate** **Unit Outline** This unit investigates factors affecting location benefits, which are major determinants in the value of real estate services. It demonstrates how competitive bidding allocates the most desirable locations to those a...

**Unit 3: Land Utilization and the Rental Value of Real Estate** **Unit Outline** This unit investigates factors affecting location benefits, which are major determinants in the value of real estate services. It demonstrates how competitive bidding allocates the most desirable locations to those activities that benefit sufficiently from the location advantages to be able to pay more than less fortunate competitors. A. Economic Factors in Land Utilization a\. As with industrial firms, in the absence of rent (or cost of property ownership), commercial firms would all want the 100 percent location. But competition for that location drives up the rent there, and what results is a declining rent schedule as one moves further from the location that would be most desirable in the absence of rent (the 100 percent location). B. The Market for Rental Space C. Market Structure and the Need for Market Research