THE
VALUE OF LANDSCAPING
Replacement Value
Landscaping can enhance the property value of
real estate in ways other than real estate value. If plants
are damaged, there is a costs to replace them. The Council
of Tree and Landscape Appraisers publishes a book which gives
various replacement costs for landscape plants. These values
are accepted by the IRS and many insurance companies. In
a 1981 U.S. Tax Court case in Arlington, Virginia, it was
determined that the loss of a single century-old black oak
on a property valued at $164,500 reduced the property value
by $15,000 or approximately 9% of the total property value.
This value was reached by one of two methods. Tress with
trunk diameter of 12 inches or less are evaluated by the
replacement. Larger trees are evaluated by the basic formula
method.
Replacement Method
Most specimen shrubs, small evergreens, and trees up
to 12 inches in diameter can be readily transplanted and thus
have a replacement value. These replacement values can be established
by quotations of prices of comparable plant material by local
nurserymen and landscape companies. Figure 1 shows average
replacement value of most trees. This replacement cost contains
the cost of the plant, installation costs, guarantees, cost
of removing the damaged trees, and profit. This price is then
modified according to species, condition, and location factors
of the tree (Appendix A). Figure 2 shows that the replacement
value of a tree can be determined by a simple formula.
Figure
1. Average replacement cost of transplantable-size trees
Trunk
diameter
Inches1 |
Basic
replacement cost -
Centimeters2 |
plus
profit (dollars)3 |
| 2 |
5 |
170-200 |
| 3 |
8 |
290-360 |
| 4 |
10 |
430-530 |
| 5 |
13 |
600-720 |
| 6 |
15 |
790-940 |
| 7 |
18 |
1050-1240 |
| 8 |
20 |
1310-1510 |
| 9 |
22 |
1580-1780 |
| 10 |
26 |
1930-2180 |
| 11 |
28 |
2330-2580 |
| 12 |
30 |
2730-2980 |
1Measurements: 2- to 4-inch diameter, taken 6 inches above ground level: 5- to 12-inch diameter, taken 12 inches above ground level.
2The "rounded metric equivalents" are recommended for use in sizing trees and other plants.
3Cost estimates based on 1981-1982 surveys.
Calculation of appraisal value of transplantable-size
trees thus becomes:
(Basic
Replacement Cost + profit) x (Species Classification) x (Condition)
x (Location) = Appraisal Value of Tree
Figure 2. Examples of appraisal
calculations for small trees.
|
Diameter
of Trunk (in)
|
Basic
Replacement Cost ($)
|
Species
Class
|
Condition
Class
|
Location
Class
|
Appraisal
Value ($)
|
|
4
|
480
|
x 85%
|
x 90%
|
x 85%
|
= 312
|
|
10
|
2055
|
x 90%
|
x 80%
|
x 95%
|
= 1406
|
Basic Formula Method
To compare the values of trees over 12 inches in trunk
diameter, the basic formula is recommended. This method uses
four major variables to determine tree value: size, species,
condition, and location. Size refers to the trunk diameter
or cross-section trunk area, which has a value of approximately
$22 per square inch cross-section of trunk. Different species
of trees have different ratings due to the quality of the tree
type (See Appendix A). Condition refers to the health and life
expectancy of the tree, and location refers to the placement
of the tree (See Appendix B). Using this data, a formula can
be established.
Value of Tree = Size (cross-section
trunk area in inches)
([_(3.14) r2])
x $22(Value Per Square Inch) x
Species x Condition x Location
For an 18 inch Live Oak tree in
good condition and located on a residential lot:
254 in2 x $22 x 95% x 75% x 80%
= $3,185
Appendix
A: Species Percentage Rating (5)
Class 1 - 100 percent
Hickories Pecan Flowering
Dogwood
Texas Persimmon American Beech American Holly
Yaupon Holly Black Walnut Sweetgum
Southern Magnolia Sweetbay Tupelo
Colorado Blue Spruce Pinion Pine Ponderosa Pine
Loblolly Pine Texas Ebony White Oak
Southern Red Oak Bur Oak Chinquapin Oak
Live Oak Shumard Oak Spanish Oak
Cedar Elm
Class 2 - 80 percent
Bigtooth Maple Texas Madrone Anaqua
Velvet Ash Modesta Ash Ginkgo
Kentucky Coffeetree S. Golden Raintree Panicle G. Raintree
Crape Myrtle Tulip-poplar Manzanilla Olive
Slash Pine Aleppo Pine Austrian Pine
Japanese Black Pine Chinese Pistachio Willow Oak
Post Oak Black Oak Japanese Pagodatree
American Elm
Class 3 - 60 percent
Huisache Red Maple River Birch
Paper Mulberry Gum Elastic Deodor Cedar
Common Hackberry Redbud Desert Willow
Arizona Cypress Loquat Green Ash
Great Lead-tree Flowering Crab Apple Fruitless Mulberry
Avocado Redbay Shortleaf Pine
Italian Stone Pine Sycamore
Class 4 - 40 percent
Boxelder Silver Maple Tree of Heaven
Silktree Catalpa Sugarberry
Hawthorns Russian Olive Chines Parasol Tree
Bois d'Arc Chinaberry Red Mulberry
Palo Verde Cottonwood Poplars
Ornamental Plum Black Locust Willows
Arborvitae Siberian Elm Jujube
APPENDIX B: CONDITION AND LOCATION FACTORS
Guide for judging the condition of a shade tree
| Factor |
Variation of Condition Factor |
Points
|
| Trunk Condition |
Sound and solid
Sections of bark missing
Extensive decay and hollow |
5
3
1 |
| Growth Rate |
More than 6-inch twig elongation
2- to 6-inch twig elongation
Less than 2-inch twig elongation |
3
2
1
|
| Structure |
Sound
One major or several minor limbs dead
Two or more major limbs dead |
5
3
1
|
| Insects and Diseases |
No pest present
One pest present
Two or more pests present |
3
2
1
|
| Crown Development |
Full and balanced
Full but unbalanced
Unbalanced and lacking a full crown |
5
3
1
|
| Life Expectancy |
Over 30 years
15 to 20 years
Less than 5 years |
5
3
1
|
| Total Points |
Condition Class |
Condition %
|
|
23-26
|
Excellent
|
80-100%
|
|
10-13
|
Good
|
60-80%
|
|
19-22
|
Fair
|
40-60%
|
|
14-18
|
Very Poor
|
20-40%
|
| 6-9 |
|
0-20% |
Location percentage for trees
| Location |
Percentage
|
| Feature or historical trees |
90-100%
|
| Average residential, landscape trees |
80-90%
|
| Malls or shopping center trees |
75-85%
|
| Public and commercial area trees |
70-80%
|
| Arboretum and park trees |
60-80%
|
| Golf course trees, strategically
located |
60-80%
|
| Street and boulevard trees |
60-80%
|
| Screen and windbreak trees |
60-70%
|
| Recreational and picnic area trees |
60-70%
|
| Industrial area trees |
50-70%
|
| Out-of-city highway trees |
40-60%
|
| Native, open woods trees |
30-40%
|
| Trees in heavily wooded areas |
10-20%
|
|
