PROCEDURE FOR ASSESSING THE MARKET VALUE OF A LAND

The concept of cadastral value

The state not only keeps records of all real estate in the country, but also evaluates it. This procedure has been mandatory in all regions since 2020. The main guiding document for calculating the KS and its possible revision is Law No. 237-FZ (). Here are some important points related to determining the price of real estate for the cadastre:

• the assessment procedure is carried out by order of regional authorities, about which a normative act is issued;
• specialists from a budgetary institution, which is vested with powers from the regional government authority, are involved in the assessment;
• carry out an assessment at least once every 5 years, but not more often than once every 3 years;
• for Moscow and St. Petersburg, special standards are provided for the timing of assessments - no more than once every 2 years;
• the results of the work of a budgetary institution are formed in a report, after which it is approved by the authorities of the constituent entity of the Russian Federation.

For the cadastral value to come into force, Rosreestr enters this data into the Unified State Register of Real Estate. After this, indicators from the cadastre are used by state and municipal authorities for taxation and for other purposes.

Expert commentary. Checking the value of land or an object using the cadastre is quite simple. You can order an extract from the Unified State Register (USRN) (through the MFC, Rosreestr or State Services), or obtain information online through the Public Cadastral Map (PCC). If the USRN information does not contain data on the cadastral value, it means that the object has not been registered, or the assessment has not yet been carried out.

Official data on cadastral value can only be obtained from an extract from the Unified State Register of Real Estate.

Where is it used?

The state calculates the cost according to the cadastre not for show, but for strictly defined purposes. This indicator is used in the following areas:

• when calculating property and land taxes, determining the amounts of tax deductions;
• to calculate rental payments for property owned by the state or municipality;
• to calculate the duty when entering into an inheritance (in this area it is also possible to use market and inventory value).

Obviously, the difference between the cadastral value and the market price of an apartment, plot or other object will immediately affect the amount of taxes, rent, and state duties.

In the commercial sphere, cadastral value is also used, although this depends on the decision of the owners, contractors and other persons. For example, you can use the cadastral price for the sale or rental of residential or non-residential properties, if the parties to the contract agree on this. In practice, the ratio of the cadastral and market value of a land plot or object is always quite significant. Therefore, in commercial activities the most objective and accurate indicator is used - the market price.

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When assessing the cadastral value, proposals for similar land plots should be assessed, both in size and individual characteristics. Thirdly, the land plot is often incorrectly classified as one or another type of permitted use, and the difference between the cost of various types of permitted use can differ tens of times. An incorrect definition - an increase in the cadastral value of a land plot, can lead to a multiple increase in land tax, the inability to bear the burden of maintaining the site, the termination of investment projects and multimillion-dollar losses for its rights holders.

Briefly about general issues related to reducing cadastral value is written in the following article.

You can find out more about the methods and techniques for solving this problem on our website, or consult with our specialists by phone, call!

Each land plot is subject to assessment, the cadastral value assessment is carried out at least once every 5 years, and is approved by a resolution on the value of local government bodies.

What is the difference between cadastral value and inventory or market price?

Let's look at which price is higher (cadastral or market), and how these indicators are related to the inventory value. Until 2013, when the main powers for real estate accounting belonged to the BTI, inventory indicators were used in almost all areas of activity. In particular, this data was used to calculate taxes, many duties, determine property depreciation rates, and for accounting purposes. Moreover, some constituent entities of the Russian Federation use inventory value for taxation even in 2020.

Here are the main differences between the cost indicators listed above:

• the cadastral value is always calculated based on the results of the state assessment - since this procedure does not provide for the inspection of objects and the determination of their actual characteristics, the price according to the cadastre will almost always be higher;
• the inventory price is calculated based on the results of the BTI inventory and according to regulatory methods - it does not always take into account the actual condition of the property, since inventory is carried out quite rarely;
• the market price is determined by professional specialists (appraisers) on the date of the assessment - since the specialist studies the actual condition of the object and analyzes similar offers on the market, this price will be as objective as possible.

In fact, when using and disposing of one object, all three indicated value indicators can be applied. For example, when receiving an apartment by inheritance, you can pay a notary fee based on the inventory value, since it is almost always lower. After entering into an inheritance, the accrual of property tax will begin immediately, and for this, the value of the object is taken from the cadastre. While using the inherited apartment, you can sell it by determining the real market price. Similarly, this is allowed for other types of objects.

How does the cadastral value of an apartment differ from the market price? Law No. 237-FZ provides that during the state assessment it is necessary to determine the real price of real estate. Unfortunately, practice is far from ideal. Objects are assessed using a mass method, and specialists do not have data on the real characteristics of real estate. For example, apartments with the same area and layout, located in the same building, will most likely have the same value according to the cadastre. In practice, their market price may differ significantly - due to repairs and an increase in the level of comfort, due to the number of floors, and other factors.

On the Public Cadastral Map you can also find out the cadastral value indicator. To do this, you can select an object directly on the map.

How to find out the difference between market and cadastral value

You can find out the difference in the market and cadastral value of land, buildings or premises yourself. This is necessary to decide whether it is worth challenging the results of the cadastre assessment and changing the USRN information. Here are some ways you can use to compare these indicators:

• independently study the offers on the market, compare all the characteristics of objects, choose similar options;
• look at the cadastral value according to the Unified State Register of Real Estate or from the PKK;
• compare both price indicators.

Most likely, you will see that the cadastral value of the land or object is higher than the market price. If the difference is not significant, challenging the cadastre price may be a waste of time. You can pre-calculate the tax that will be charged on both cost indicators. If the difference is a few kopecks or rubles, then challenging it will not lead to much savings, and you will incur the cost of an assessment.

If the difference between the market and cadastral value of a land plot, premises or building is large, you will have to overpay taxes annually. For example, if you own many objects with a large area, the overpayment can be tens or hundreds of thousands of rubles (this is especially true for large enterprises). In such a situation, it makes sense to go through the contestation procedure and equate the price according to the cadastre to the market value.

Expert commentary. Smart Way specialists will help you check the difference between the market price and the market value of the object with the indicators from the Unified State Register of Real Estate. We will prepare recommendations on further actions to challenge, provide support when applying to the Rosreestr Commission or the court, and prepare all the necessary documents.

How to find out the cadastral value on the Rosreestr website

Information on cadastral value indicators of objects is available online. To obtain this data, you need to go to the Rosreestr website using the link, select the menu item “Find out the cadastral value”. This item is marked in the photo below.

On the screen there is an item for selecting a menu about cadastral value indicators.

After clicking on the link, a data request window will appear. In it you need to indicate the cadastral or conditional number of the object, and step by step select the address data from the menu. To confirm the request has been sent, enter the verification code. After clicking the “Generate request” button, information about the cadastral value based on the results of the latest assessment will be provided. Please note that this will be for reference only. Official information can only be obtained from the USRN extract.

Correctly indicate the cadastral number of your property. If you don't know him, you can get this data through a public cadastral map.

Documentation required to assess the value of a land plot

In order to evaluate a land plot, the appraisal firm must provide a number of documents. The main ones are title documents (land use act), cadastral plan and information about the category of the site, based on its intended purpose. It is also necessary to provide documentation with information about the encumbrances and restrictions imposed on the land plot.

If there are any engineering structures on the site, providing information about them is mandatory. If the site being valued is leased, it is also necessary to have a lease agreement in the list of documentation, and if the owner of the site is a legal entity, a certificate of the book value of the property being valued is also required.

The ratio of cadastral and market value of land: higher or lower

Below we will analyze what is more expensive – the cadastral value or the market price, whether these indicators can coincide, and what to do if there is a large difference. Please note that with each subsequent state. real estate valuation, its value may vary. But the budgetary institution is obliged to check whether the cadastral value has been disputed. If this procedure has been carried out, the relevant data will be taken into account in the assessment.

Why does the cadastral value differ from the market value?

To understand why the cadastral value of land, premises or buildings is higher than the market value, you need to know the procedure for conducting state registration. assessments. The budgetary institution performs it as follows:

• cadastral information, information from authorities on categories, types of permitted use and other indicators of real estate are requested;
• data on previous challenges to the cadastral value is checked (if they were carried out);
• documents submitted by owners or other interested parties are considered (this is possible, since information about the assessment is published in advance in the media and on the Internet).

The list of activities does not include visiting the site, surveying and inspecting the site or facility. This is the main reason for the difference between the cadastral price and the market price.

Expert opinion. There is one more circumstance that entails an overestimation of the price of real estate according to the cadastre. An overestimation of the cadastral value entails an increase in tax revenues to the budget. Therefore, the authorities are indirectly interested in high prices according to the Unified State Register of Real Estate. Consequently, if the owner himself does not take action to challenge and eliminate the discrepancy, the state or municipality will be the winner.

The diagram shows an algorithm for conducting a state assessment to determine the cadastral value.

How much higher is the market value than the cadastral value?

The differences between the cadastral and market value of a land plot or object will be different for all regions. On state the assessment is influenced by many factors (location of objects, requirements of local or regional laws, restrictions on land protection regulations, etc.). Therefore, it is possible to determine how much the cadastral value differs from the market price only by comparing these indicators for each specific object. Sometimes there are situations when the market price will be higher than the corresponding figure in the Unified State Register of Real Estate.

Types of land valuation

In total, there are 4 types of assessment of the market value of land.

1. Investment . In this case, the value is determined based on the possibility of making a profit from the memory, using it as an investment instrument. That is, how much money you can get by investing in a given site.
2. Liquidation .
   When calculating the liquidation value, factors are taken into account due to which the owner is ready to sell the property in the shortest possible time. Most often, the liquidation value is less than the market price, since the sale of a land plot is associated with certain, most often unpleasant, circumstances - the plot is in disrepair, the owner sells it to pay off a loan, etc.
3. Cadastral. Such an assessment of the value of a piece of land is regulated by law and is carried out, in particular, to establish the amount of taxes on specific real estate.
4. Market. It is the most popular type of assessment, so it is worth talking about it in more detail.

Establishing the cadastral value equal to the market value

What to do if the cadastral value of an apartment is higher than the market value? If the difference is significant, you need to order an independent assessment and go through a challenge procedure. This is not the most difficult procedure, however, you may still face refusal. With the support of Smart Way specialists, you can achieve equalization of the value of an object according to the cadastre to market values ​​as quickly as possible and without additional difficulties.

Grade

To prove that the cadastral price is higher than the market price, you need to order an independent assessment. To do this, you need to select an appraiser who is a member of a specialized SRO, enter into an agreement, and transfer documents for the site, premises or building. In addition to studying proposals for similar objects on the market, the appraiser will conduct a physical survey. The result of the work will be the preparation of a report or conclusion on the market price. This document must be used when challenging through the Commission or court.

The owner's action algorithm for challenging the cadastral value is presented in the form of a diagram.

Appeal to the Commission

Having received a report or conclusion on the market price, you can begin to challenge the value according to the cadastre. In each subject of the Russian Federation there is a Commission under Rosreestr, which considers applications from owners. Here are the main points related to the consideration of cases by the Commission:

• citizen-owners can choose the option of challenging themselves - directly to the court or first go through the Commission;
• there is no alternative for organizations - they are obliged to apply to the Commission, and its refusal can already be appealed in court;
• In the application, you can indicate that the cadastral and market values ​​of the land or object differ, or draw attention to mistakes made in the state. assessment;
• The Commission includes representatives of the authorities, Rosreestr, and the community of appraisers.

The cadastral and market value of plots, premises and buildings will be compared using the Unified State Register of Real Estate (USRRN) extract and the appraiser’s report. In most cases, the Commission objectively considers such cases, since it includes representatives of appraisers. After a positive decision, the new cost indicator will be included in the Unified State Register.

Going to court

You can go to court if the Commission made a refusal decision, or the citizen immediately decided to file a claim. The main documents for going to court will be:

• statement of claim (if appealing a decision of the Commission, this will be an administrative claim);
• legal documents for the object;
• USRN extract;
• market price report.

If the court is convinced that the cadastral value of the apartment and the market value have significant differences, a positive decision is made. The cost of the object according to the cadastre will be recognized as equal to the market price. The relevant data will be entered into the Unified State Register of Real Estate on the basis of a judicial act.

Expert commentary. The Smart Way company provides services for challenging cadastral values ​​in administrative and judicial proceedings. We will prepare all the necessary documents and represent your interests during the consideration of cases. You can learn more about our services at a free consultation.

Who determines the cadastral value and how?

The methodology for determining the CC is established by law, at the federal level or in the constituent entities. The specifics of the calculations depend on the category to which the site belongs. Cadastral specialists are required to strictly follow the prescribed procedure and use special formulas. This is stated in the Land Code and the law regulating valuation activities.

Work on cadastral valuation of land is carried out every five years. Until the start of a new test cycle, the previously set parameters apply. The calculated cadastral value of each plot is also saved. A revision of the parameters for the assessment or the revaluation of the site itself can be carried out ahead of schedule, on the basis of a court decision. The initiator of the proceedings may be the land owner himself or the tax authority.

The results of the site assessment by cadastral specialists are reviewed by a special commission and then approved at the level of the constituent entities of the Russian Federation. Only after this the land tax begins to be calculated. Conducting an assessment is one of the mandatory stages when registering a site.

The assessment parameters applied to a particular site depend on the category to which it belongs. Thus, when determining the cadastral value of a plot included in settlement lands and intended for housing construction, statistics on the market value of plots and its fluctuations over the past few years are important. The same criteria are used when assessing land allocated for gardening, vegetable gardening, and the construction of summer cottages or garages.

Income method

The assessment is based on an analysis of the income that the owner of the land can receive by using it according to its intended purpose. Not only the current state of affairs is taken into account, but also the future. It is obvious that areas on the outskirts of a large city will sooner or later be used for residential development or road construction. Consequently, their cost will be higher than that of similar plots far from populated areas. An exception may be land near popular natural sites or recreational areas. The possibility of creating associated infrastructure will immediately increase the market value of such sites.

List of useful documents

Documents for download:

Many issues related to challenging the cadastral value are explained on the Rosreestr website.

Timing and cost

You can challenge the value of an object according to the cadastre through the Commission free of charge. When going to court, you need to pay a fee of 300 rubles. (citizens) or 6000 rub. (organizations). The applicant’s expenses also include payment for the USRN extract. appraiser services. If a representative defends interests in the Commission or court, the cost of his services is determined by agreement. You can see preliminary prices for our services in the table below.

conclusions

• The cadastral value is determined during the state process. estimates, so it almost does not coincide with market values.
• The cadastral value exceeds the market value, since the state the assessment does not take into account individual characteristics and improvements of objects.
• You can compare market and cadastral value indicators using the Unified State Register of Real Estate (USRRN) extract and PPK information with real prices in a constituent entity of the Russian Federation or city.
• To equate the cadastral value to the market price, it is necessary to obtain a report from an expert appraiser and go through the procedure through the Commission or court.

Smart Way will help you with all questions related to lowering the value of real estate according to the cadastre. Our consultants will tell you about our services by phone using the feedback form.