NAC361.1198. Land: Capitalization of ground rents.

     1. A county assessor may use the capitalization of ground rents to derive the value of land only when there is sufficient information regarding land rentals or leases which are independent of improvements, such as, without limitation, a rental of farmland or commercial land which is leased on a net basis where the lessee is responsible for property taxes and all other expenses.

     2. When using the capitalization of ground rents to derive the value of land:

     (a) A county assessor must perform that method in accordance with the provisions of chapter 7 of Property Appraisal and Assessment Administration, as adopted by reference in NAC 361.1177.

     (b) If a lease:

          (1) Has been recently negotiated or is still representative of current market rents, a county assessor may directly capitalize the net rent into an indicated land value; or

          (2) Is outdated or no longer representative of current market rents, a county assessor must reject the lease or adjust the lease to current market conditions using verifiable market data.

     (Added to NAC by Tax Comm’n by R039-10, 8-13-2010, eff. 7-1-2012)