What Is Capital Value?

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Capital value is the price that would have been paid for land or property if it had been purchased when it was evaluated. Capital value is not the same as land value because land value includes only land and improvements done to the land, such as excavation.

The probable monetary difference between capital value and land value is known as the value of improvements. When any buildings or other improvements are added to a property, it increases the capital value. Capital value does not include goodwill, crops, machinery, stock or plantation trees. Capital value does include dwellings and landscaping procedures that add to the value of the property.