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Agricultural valuation
Do you own an agricultural property and need a valuation? An agricultural valuation is a thorough review of the property’s value, based on a number of factors such as area, buildings, soil and forest quality, access to pasture and much more.
We work with experienced valuers across the country and can help you find the right valuer for your property.
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What is an agricultural rate?
An agricultural valuation is a thorough valuation of an agricultural property, carried out by an appraiser with specialist expertise in this area. Unlike a standard residential appraisal, which focuses primarily on the residential building and the land, an agricultural appraisal looks at all aspects of the property that have a bearing on the total value in use.
This includes factors such as:
- Land area: Both total area, cropland, pasture, forest and outfield.
- Buildings: Farmhouse, farm buildings, farmyard and other buildings.
- Soil and forest quality: Soil quality, tree species, felling class and operating conditions.
- Pasture availability and quality.
- Access, landscaping and infrastructure on the property.
- Rights and obligations: Hunting, fishing, road rights, etc.
- Operating methods and development potential.
The valuer carries out a detailed review of all these elements, both through physical inspection and the collection of relevant documentation. The aim is to provide a comprehensive picture of the property’s value.
An agricultural valuation often contains several different valuations, depending on the purpose of the valuation. The most common ones are market value, yield value, cost value and utility value. The market value reflects what the property can be sold for in the open market, while the other values are linked to specific uses or legal provisions.
In addition to the value, the agricultural valuation will contain detailed descriptions of all parts of the property, often with maps, photos and calculations. This makes it a useful document not only for valuation, but also for planning and developing the operation.
A thorough agricultural valuation can therefore provide you as the owner with a solid basis for decision-making, whether you are considering selling, generational change, investments or changes to the operating structure. It also ensures that all aspects of the property are assessed and valued in a professional manner.
What does an agricultural valuation cost?
The price of an agricultural valuation will vary depending on the size, complexity and location of the property. As a rule, prices will vary from NOK 8.000 to NOK 30.000. On average, an agricultural valuation costs around NOK 15.000.
In addition to the actual appraisal work, the price will also include the appraiser’s travel expenses, any rental of special equipment and the collection of external documentation.
Most valuers operate with an hourly rate of between NOK 1.200 and 1.500 excluding VAT. For an average agricultural valuation, you can expect the valuer to spend between 10 and 15 hours in total, including inspection, data collection and reporting.
This affects the price of the agricultural valuation:
- Area and landscaping: A large property with a lot of forest and open land will take longer to appraise than a smaller, more compact property.
- Number of buildings: The more houses, farm buildings and other structures that need to be assessed, the more work for the valuer.
- Distance and accessibility: Properties in remote areas or with difficult access will often involve higher travel costs for the appraiser.
- Available documentation: If much of the basic material is missing or outdated, the valuer will have to spend more time collecting and checking data.
When is an agricultural valuation required?
The regulations state that all agricultural properties with more than 35 acres of cultivated land, or which have a total area of more than 100 acres, are subject to licensing and must therefore be appraised. This applies regardless of whether the property is actively farmed or not.
In the case of the sale of agricultural properties that trigger licensing or borrowing requirements for the property, there are a number of laws and regulations that govern how the valuation should be carried out. It is particularly important that the valuer has in-depth knowledge of the Licensing Act, the Farming Act and other rules laid down by the Ministry of Agriculture and Food.
These regulations lay down detailed guidelines for how different parts of the property should be valued. For example, land and forests are generally valued on the basis of expected yield, not market value. The same applies to other natural resources on the property and income from rental of buildings or land.
In cases relating to the Land Tenure Act, there are special provisions for how the valuation should be determined. This is to ensure the fairest possible price for all parties, regardless of kinship and other circumstances.
Due to the complexity of the regulations, not all valuers have the necessary expertise to carry out agricultural valuations for licensing purposes or in land consolidation cases. In-depth knowledge of the special valuation methods to be used is required, in addition to an understanding of the legislation itself.
How is an agricultural valuation carried out?
The valuer will first obtain basic information about the property, such as the registered area, type of building, type of farming, etc. This is followed by the actual valuation work, which will normally consist of the following steps:
- Physical inspection of the property: The valuer will always carry out a thorough inspection of the entire property. He will inspect all buildings, both inside and out, and assess the condition of the land, pastures, forests and outfields. During the inspection, the valuer will take photos and notes as documentation.
- Obtaining maps and documentation: In order to get a comprehensive picture of the property, the valuer will collect various maps and documents, such as base maps, soil quality maps, forestry plans, building drawings, registered rights, etc. Some of this may need to be ordered from the relevant authorities, which the valuer will arrange.
- Assessment of buildings: All buildings on the property will be thoroughly assessed, both technically, functionally and in terms of value. The valuer will look at the year of construction, materials, maintenance, improvements and general condition. For farm buildings, practical solutions and efficiency are also emphasized.
- Assessment of land, forest and outlying land: The appraiser will assess the quality and quantity of the agricultural land, based on factors such as soil type, drainage, topography and slope. For forests, the appraiser will look at quality, felling class, tree species and accessibility. Outdoor resources such as grazing, hunting and fishing are also valued.
- Compilation of values: Based on all the data collected and their own assessments, the valuer will compile the various parts into a total value for the property. Several different methods are often used here, such as comparable sales, yield value, utility value and technical value, depending on the purpose of the valuation.
- Preparation of the report: The result of the appraisal will be summarized in a comprehensive appraisal report. The report will contain detailed information about all parts of the property, supported by photos, maps, calculations and source references. The conclusion will be a set of value estimates for the property, based on various methods.
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How is the valuation of an agricultural property determined?
The value of an agricultural property is determined through a combination of technical assessments, comparable sales and the appraiser’s judgment.
The buildings are valued based on area, standard, age and condition. Agricultural land is valued on the basis of production capacity, where factors such as soil quality, drainage and landscaping come into play. For forests, standard values are often used based on quality and felling class.
The valuer also looks at prices from comparable properties in the area, adjusted for differences. For properties in operation, a yield value is often calculated based on the expected annual profit.
In addition, factors such as location, development opportunities, rights, public orders and general market conditions are emphasized. The weighting varies depending on the purpose of the appraisal, whether it is a license, cultivation solution or voluntary sale.
The aim is to produce a valuation that provides a realistic market value, while at the same time taking into account the special considerations for agricultural properties.
Different valuation terms and their meaning:
A number of different terms appear in agricultural valuations. It’s important to understand the differences between them and what they mean.
Partial rate
The land value is a valuation of farmland that is determined when a person entitled to farmland takes over a property through land consolidation. This valuation should reflect the property’s value in a free sale, but at the same time take into account that it will mainly be used for agricultural purposes. The allotment price is only set in legal cases related to allotment dissolution when a farm has been sold out of the family or to someone with weaker allotment rights. In such cases, the owner of the right of usufruct has six months to demand to buy the property.
The allotment price is usually set higher than an estate price, but lower than a pure market value. The assessment considers the property’s potential for agriculture, forestry, horticulture and other primary industries. The aim is to strike a balance between the real value of the property and the need for it to be profitable as an agricultural property. Odelstakst is regulated in Sections 49 and 50 of the Odelsloven, and is an important part of the Norwegian odels system, which is intended to ensure that agricultural properties remain in family ownership for generations.
Ridge tax
Åsetestakst is a special valuation of agricultural properties that is used when the children or grandchildren of an owner entitled to inherit the farm through inheritance. The purpose of this valuation is to ensure that the next generation can take over the farm at a price that makes it possible to operate profitably. Åsetestakst considers that the property will be run exclusively as a farm and is therefore set considerably lower than an odelstakst or market value.
Åsetestakst is regulated in section 56 of the Odelsloven, which specifies that the valuation must be set with a view to the transferee being able to retain the property. No-one is automatically entitled to an åsetestakst; it is only used when the owner has died, and the property is to be taken over by heirs. The valuation must reflect a reasonable acquisition price based on the circumstances at hand and can never be set higher than the value of the original valuation. This principle is an important part of Norwegian agricultural policy, designed to preserve family farms and ensure continuity in agriculture.
Consequential tariff
Concessionary valuation is the basis for the valuation of licensed properties and in practice represents an assessment of the property’s value in the open market. This form of valuation is used for almost all valuations of licensed property and considers both the Licensing Act and local market conditions. The appraisal includes a valuation of land, forests, buildings, rights and any encumbrances.
The aim of the valuation is to establish a value that both reflects what can be expected to be achieved in the market and that will be approved in a municipal licensing process. The tariff balances between the market’s willingness to pay and the authorities’ regulation of property prices in agriculture. Buyers may often be willing to pay more than the valuer’s assessment, but the licensing process acts as a restriction through the possibility of price regulation. License fees thus play an important role in maintaining a balance between market forces and agricultural policy goals in the sale of agricultural properties.
How do I get an offer for agricultural tariffs?
The regulations surrounding agricultural valuations are complex, and not all valuers have the necessary expertise to carry out agricultural valuations. The person performing the valuation must have in-depth knowledge of the specific valuation methods to be used, as well as an understanding of the regulations themselves.
It can be difficult to know who to contact and what to look for when you need an agricultural valuation. The process of finding a skilled and experienced surveyor can take hours, and that’s where we want to help you.
We work with valuers across the country who specialize in agricultural valuations. Fill in the form with some information about the assignment, and we will forward your enquiry to the valuer in your local area who can best help you. Our service is free and completely non-binding. The appraiser in question will then contact you directly to discuss the assignment further.