The legally and physically possible use of land that is likely to produce the highest land (or property) value. It considers the balance between site and improvements as well as the intensity and length of uses.
The use or uses of a property, chosen from various possible uses, that generates the highest most probable market value, as limited by market demand and supply, the propertyâ€(tm)s own characteristics, physical and economic feasibility, location, access, utilities, environmental hazards, â€œgrandfatheredâ€ rights, and pertinent legal restrictions. Thus, anything that can affect value can affect highest and best use. Further, it is a market driven concept and does not take in to consideration non-economic subject property uses, such as: parks, open space, public schools, libraries, athletic fields, etc., except as they may otherwise impact value. Its focus is upon what the property can sell for in the marketplace, even if a non-economic use is very desirable. For example, if it is found that a subject property has 4 potential uses: A, B, C, and D, and that use A generates a most probable market value of $100, use B $90, use C $80, and use D $100, then the highest and best use of this property is both A and D.
The property use that at a given time produces the greatest net worth return.
An appraisal term meaning the legally and physically possible use that, at the time of appraisal, is most likely to produce the greatest net return to the land over a given period.
The most probable, reasonable use which will support the highest percent value as of the effective date of the appraisal; that use which provides the greatest net return on the investment over a given period; that use, from among the reasonably probable and legal alternative uses, found to be physically possible, appropriately supported, and financially feasible which results in the highest land value; that use which fully develops the site's potential; or the most profitable use to which a property can be put.
An appraisal phrase meaning that use which at the time of an appraisal is most likely to produce the greatest net return to the land and/or buildings over a given period of time; that use which will produce the greatest amount of amenities or profit. This is the starting point for appraisal.
the most profitable likely and legal use to which a parcel of land is likely to be put (a determination made in calculating value).
The most profitable and likely legal use of a property.
The permissible property use that at a given point of time is deemed likely to produce the greatest net return in the foreseeable future, whether or not such use is the current use of the property.
As used in the Cost Approach -- That use of real property, which if employed to its most effective highest use, will result in a higher sale price. In appraisal practice, this can become one of the most intricate aspects of an appraisal report. Tests to establish the highest and best use include analyzing the physical use of the property, legal use of the property, economic feasibility and the anticipated future use of the property.
That possible use of land that will produce the greatest net income and thereby develop the highest land value. High rise. An inexact term, usually denoting a building of steel frame construction regardless of the building height.
An appraisal and zoning concept that evaluates all the possible, permissible and profitable uses of a property to determine the use that will provide the owner with the highest net return on investment in the property, consistent with existing neighboring land uses.
The use of land or buildings which will bring the greatest economic return over a given time which is physically possible, appropriately supported, financially feasible.
That use which, at the time of appraising the property, is most likely to produce the greatest net return to the land and/or the building over a given period of time.
The possible use of a property that would produce the greatest net income and thereby develop the highest value.
The legal, reasonable and probable use which will support the highest value of the property.
The legal use (or development/redevelopment) of a property which makes it most valuable to a buyer or the market.
The most profitable and likely use of a property. Selected from reasonably probable and legal alternative uses, which are found to be physically possible, appropriately supported and financially feasible to result in the highest possible land value.
The reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility and maximum profitability.
An appraisal phrase that means that use of real property that is most likely to produce the greatest net return on land or buildings, or both, over a given period of time. Back to the Top
A principle in valuation, stating that real estate valuation is maximized when land is utilized in the best possible way.
Appraisal term meaning the legally and physically possible use that will produce the greatest current value.
The particular use of a real property which will produce the greatest financial return. The optimum use of a site as used in appraisal. This is often determined by location, neighboring properties, deed restrictions and local zoning regulations. A home built on a busy street, surrounded by commercial property, and not restricted from other development, is not fulfilling its highest and best use. Once the property is redeveloped into commercial property, it can meet it economic potential.
Highest and best use is a concept in Real estate appraisal. It states that the value of a property is directly related to the use of that property; the highest and best use is the reasonably probable use that produces the highest property value. This use, the Highest and Best Use, may or may not be the current use of the property.