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STRATEGIC GROWTH AND RURAL CONSERVATION PROGRAM
<br />Draff (IOJ.2007~
<br />Value. The median land value per acre of recently developed parcels near-urban
<br />areas is double that of recently developed rural parcels, $32,000 per acre compared to
<br />$14,000 per acre (Table 2-2). This finding confirms that there are different housing
<br />markets in the two areas, and that the SGRC Program will need to take into account
<br />the inherent differences in land value when setting formulas to convert developable
<br />acres from the rural areas to the near-urban areas.
<br />Table 2-2. Land Value Statistics for Near-Urban vs. Rural Areas
<br />_~ ._
<br />Near-Urban
<br />0
<br />556,368
<br />38,063
<br />24,576
<br />47,943
<br />1.6
<br />
<br />Deve o e
<br />Recent develo ment 0 556,368 90,141 32,298'rr' 130,425 1.5
<br />Undevelo ed 0 446,359 22,067 13,241 32,688 2.4
<br />Rural 0 175,267 16,658 11,958 16,127 3.4
<br />Develo ed 0 175,267 18,567 14,426 16,130 2.8
<br />Recent develo ment 0 127,313 24,743 14,257- 27,577 4.1
<br />Undevelo ed 0 155,945 12,024 7,517 15,154 6.1
<br />The reason for using land value per acre, rather than simple land value or total value
<br />per acre, is to assess the parcels on a level playing field, without taking into account the
<br />size of the parcel, or the size or value of the house itself.
<br />Moreover, data in Table 2-2 show that the range and standard deviation of land values
<br />in the near-urban areas is nearly four times that of the rural areas, indicating strong
<br />fluctuations in value in the near-urban areas. Large differences in value are significant
<br />when considering that the SGRC Program must take into account differences in land
<br />value to correctly set formulas that will result in appropriate economic incentives.
<br />To further investigate how much distance from a municipality influences land value, we
<br />ran across-correlation between distance, parcel size, land value and total (land +
<br />building) value per acre (Table 2-3). A value close to one in the table indicates that the
<br />two variables are strongly influence each other, while a value of less than 0.5 indicates
<br />that the two variables are largely independent. A negative value indicates that when
<br />one variable increases, the other decreases. For example, land value per acre is
<br />correlated with total value per acre very strongly,. with a value of 0.95, indicating that
<br />when land value is high, total value is very likely to be high. The correlation values
<br />between distance from municipal boundary and land value per acre and parcel size
<br />do not show a strong correlation. This indicates that the variables are largely
<br />independent, and land value is based on additional factors.
<br />Table 2-3. Cross-Correlation of Key Variables
<br />Parcels
<br />Distance from
<br />munici al bounds 1 0
<br />Parcel Size 0.26 1.0
<br />Land Value er acre -0.38 -0.21 1.0
<br />Total Value er acre -0.32 -0.17 0.95 1.0
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<br />Orange County, North Carolina ~
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