This thesis is an implicit farmland value study which explores the possible effects of agricultural commodity prices, interest rate and land reform issues on farmland values. The study examines the impacts of these fundamental factors (interest rates and returns to farmland as determined by crop prices) on sugar cane farmland values, maize farmland values, on deciduous fruit (apples and pears) farmland values, and on aggregate South African farmland values. Expectations are that land reform influences the demand for farmland. Since farmland prices are demand driven, changes in the demand for farmland (as influenced by land reform issues) may result in changes in farmland prices. The study thus seeks to empirically examine, to a larger extent, the long-run influence of endogenous factors on farmland prices. Causes of cyclical behaviour in farmland prices are also examined. The study draws on cross-sectional and time series studies of previous research on farmland values. The maximum likelihood Johansen (1991) procedure of cointegration is used to estimate the relationship between fundamental factors and farmland values. The logit model is used to estimate the influence of land reform on the demand for farmland, hence farmland prices. Unit root and the Johansen cointegration test results proved that long-run relationships exist between farmland values and returns to farmland; the use of cointegration methods was thus recommended. Long-run changes in farmland prices are caused by fundamental factors. Short-run variations in farmland prices are caused by exogenous factors that affect net farm income and this lead to boom-bust cycles in farmland values. / Thesis (M.Comm.) - University of KwaZulu-Natal, Pietermaritzburg, 2009.

Thesis (MScAgric) -- Stellenbosch University, 2011. / ENGLISH ABSTRACT: In South Africa more than 80 percent of the total land area is used for agriculture and subsistence livelihoods. A land transaction is generally not a recurring action for most buyers and sellers, their experience and knowledge are limited, for this reason the services of property agents and valuers are sometimes used, just to get more information available. The condition of insufficient information and the inability to observe differences in land productivity gives rise to the undervaluation of good land and overvaluation of poor land. The value of a property plays an important role in the acquisition of a bond, in this context farm valuations are essential and therefore commercial banks make more use of specialist businesses that have professional valuers available. The advent of the Internet made access to comprehensive information sources easier for property agents and valuers whose critical time and resources can now be effectively managed through Geographic Information System (GIS) integrated workflow processes. This study aims to develop the blueprint for a farm valuation support system (FVSS) that assists valuers in their application of the comparable sales method by enabling them to do the following: (1) Rapid identification of the location of the subject property and transaction properties on an electronic map. (2) Comparison of the subject property with the transaction properties in terms of value contributing attributes that can be expressed in a spatial format, mainly a) location and b) land resource quality factors not considered in existing valuation systems that primarily focus on residential property. Interpretation of soil characteristics to determine the suitability of a soil for annual or perennial crops requires specialized knowledge of soil scientists, knowledge not normally found among property valuers or estate agents. For this reason an algorithm, that generates an index value, was developed to allow easy comparison of the land of a subject property and that of transaction properties. Whether this index value reflects the soil suitability of different areas sufficiently accurate was confirmed by soil suitability data of the Breede and Berg River areas, which were obtained by soil scientists by means of a reconnaissance soil survey. This index value distinguishes the proposed FVSS from other existing property valuation systems and can therefore be used by valuers as a first approximation of a property’s soil suitability, before doing further field work. A nationwide survey was done among valuers and estate agents that provided information for the design of the proposed FVSS and proved that the need for such a system does exist and that it will be used by valuers. / AFRIKAANSE OPSOMMING: Meer as 80 persent van die totale grondoppervlakte in Suid-Afrika word gebruik vir landbou en bestaansboerdery. 'n Grondtransaksie is oor die algemeen nie 'n herhalende aksie vir die meeste kopers en verkopers nie, hul ervaring en kennis is beperk, om hierdie rede word die dienste van eiendomsagente en waardeerders soms gebruik om meer inligting beskikbaar te kry. Die toestand van onvoldoende inligting en die onvermoë om verskille in grondproduktiwiteit te identifiseer gee aanleiding tot die onderwaardering van goeie grond en oorwaardering van swak grond. Die waarde van 'n eiendom speel 'n belangrike rol in die verkryging van 'n verband. In hierdie konteks is plaaswaardasies noodsaaklik en daarom maak kommersiële banke meer gebruik van gespesialiseerde maatskappye wat oor professionele waardeerders beskik. Die koms van die Internet het toegang tot omvattende inligtingsbronne makliker gemaak vir eiendomsagente en waardeerders wie se kritiese tyd en hulpbronne nou effektief bestuur kan word deur middel van Geografiese Inligtingstelsel (GIS) geïntegreerde werksprosesse. Hierdie studie poog om die bloudruk vir 'n plaaswaardasie ondersteuningstelsel te ontwikkel wat waardeerders sal help in hul toepassing van die vergelykbare verkope metode deur hul in staat te stel om die volgende te doen: (1) Vinnige identifisering van die ligging van die betrokke onderwerp eiendom en transaksie eiendomme op 'n elektroniese kaart. (2) Vergelyking van die onderwerp eiendom met transaksie eiendomme in terme van waardedraende eienskappe wat in 'n ruimtelike formaat uitgedruk word, hoofsaaklik a) ligging en b) bodem gehaltefaktore wat nie oorweeg word in bestaande residensieel georiënteerde waardasiestelsels nie. Interpretasie van grondeienskappe om die geskiktheid van grond vir eenjarige of meerjarige gewasse te bepaal vereis gespesialiseerde kennis van grondkundiges, kennis wat nie normaalweg gevind word onder eiendomswaardeerders of eiendomsagente nie. Om hierdie rede is 'n algoritme ontwikkel sodat die grond van ‘n onderwerp eiendom d.m.v. ‘n indekswaarde met transaksie eiendomme vergelyk kan word. Die indekswaarde is akkuraat genoeg bevestig toe dit vergelyk is met grond geskiktheidsdata wat deur grondkundiges in die Breede- en Bergrivier gebiede ingesamel is. Hierdie indekswaarde onderskei die voorgestelde plaaswaardasie ondersteuningstelsel van ander bestaande eiendom waardasiestelsels en kan dus deur waardeerders gebruik word as 'n eerste bepaling van 'n eiendom se grond geskiktheid, voordat verdere veldwerk gedoen word. 'n Landwye opname is gedoen onder waardeerders en eiendomsagente wat inligting voorsien het vir die ontwerp van die voorgestelde plaaswaardasie ondersteuningstelsel, asook bewys gelewer het dat daar ‘n behoefte aan so 'n stelsel bestaan en dat dit deur waardeerders gebruik sal word.