Technology continues to bring the real estate industry and those professionals who earn a living in it, some exciting, new products and services. The latest to hit the market is a Web-based tool that brings to your fingertips an online database detailing land and property values throughout the United States. The data, developed under the auspices of the Lincoln Institute of Land Policy and the Graaskamp Center for Real Estate at the Wisconsin School of Business, will be featured in its "Resources and Tools" section of Lincolninst.edu, and provide separate price indices for land and structures, in addition to the more common price indices for property, land and structures combined.

"Price indexes and values of land inform the analysis of trends and cycles in house prices," said Morris A. Davis, an assistant professor of Real Estate and Urban Land Economics at the Wisconsin School of Business and fellow at the Lincoln Institute of Land Policy, who created the data sets. Information on the values and rents of residential properties in the U.S. cover three dimensions:

• Rent-Price Ratio: The ratio of rents to prices for the stock of all owner-occupied housing.

• Aggregate U.S. Land Prices: Values and price indexes for all land, structures, and housing in residential use.

• Metro Area Land Prices: Values and price indexes for land, structures, and housing for single-family owner-occupied housing units in 46 major U.S. metropolitan areas.

"If housing were simply a manufactured good, and location or land had no value, then the price of housing would be determined by construction costs, and housing prices would increase at roughly the same rate as the price of other goods in the US economy," explained Davis.

But, Davis noted, housing is on land with a specific location, and good locations are often scarce and valuable. If construction costs rise slowly over time and desirable locations are in limited supply, increases in the demand for housing can translate directly to increases in the price of good locations, the land, and in house prices. Accordingly, information on changes in the price and value of land over time often relate to trends and cycles in housing demand.

Although the rent-to-price ratio and the price and value of land are obvious metrics for understanding dynamics of housing and house prices, few of these data can be directly observed. In the case of the rent-to-price ratio, the implicit rents accruing to homeowners must be estimated based on market rents of similar rental units. In the case of land, direct land sales are rarely observed in built-up areas and occur mainly where new suburban development occurs. To estimate the value of land in built-up areas requires separating the directly observed sale price of housing into the underlying values of the housing structure and the land, neither of which is separately observed. The online database provides disaggregate estimates of property value for real estate analysis.

Technology is great when it works – and when it meets a need. This new site accomplishes both. You can view the Land and Property Values in the U.S. database by visiting lincolninst.edu.

[Editor’s Note: The Lincoln Institute of Land Policy is a leading resource for key issues concerning the use, regulation, and taxation of land. For more information on the Lincoln Institute, visit lincolninst.edu. The Wisconsin Real Estate Program is one of the oldest academic real estate programs in the world, www.bus.wisc.edu/wcre. Morris A. Davis is assistant professor of real estate and urban land economics at the Wisconsin School of Business, and a fellow at the Lincoln Institute of Land Policy.]

Published: August 12, 2009

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Peter L. Mosca is president and founder of BAK Communications, Inc. He has over 22 years of communications and media consulting experience, serving a variety of nonprofit organizations, including the CCIM Institute and the REALTOR Association on all three levels – national, state and local. He is the Spokesperson Trainer for the CCIM's Jay Levine Academy and trains hundreds of residential REALTORS nationwide to be effective industry spokespeople. He is consistently ranked as "excellent" by about 90% of those who attend his presentations. While his principal consulting focuses are public speaking and media relations development and content delivery and management, Peter is also the host of the Voice America Network's weekly radio program, "Income Property Investment Talk," a one-hour program that brings the powerhouses of commercial and residential real estate to property investors every Wednesday at 11 a.m. EST. Peter is married 17 years to his wife Barbara. They have two children: Ashley, 15 and Kelli, 12. Hence, the name BAK Communications, Inc.