land purchases / sales

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5 comments

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    IMPLAN Support
    Hi Alex, Thanks for sending in your question. Because IMPLAN models measure the value of production, there is no way to model land purchase. You can include the value in your report but for the model, there will be no impact. If you know that 9% of your production costs go toward land purchase, you can reduce your total production cost value by 9% and use that number as your total value in IMPLAN, so that your results are more accurate. Please let me know if you have any additional questions! -IMPLAN Staff
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    alantsberg
    that had been my approach earlier, but i thought that there might be a way to allocating those funds to "other property income" or some similar category.
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    IMPLAN Support
    Alex, “Other Property Type Income” is a category meant to include dividends, corporate profits, capital and inventory. It does not include the sale or purchase of property. IMPLAN sectors represent current accounts. Capital purchases (such as land and structures) are not a part of an IMPLAN sector's annual purchasing pattern. In addition, OPTI is not internalized in the multipliers. Therefore, increasing OPTI will not have an impact effect. You can read more about our multipliers at the link below. Explaining the Type SAM Multiplier http://support.implan.com/index.php?option=com_content&view=article&id=364:364&catid=228:228 More importantly, IMPLAN measures impacts based on industry production relationships. Purchase of ownership of land is an asset swap; there is no production related to the purchase outside of some activity in the real estate and finance sectors. You do mention that the land is acquired from local property owners. You could consider measuring the impact of their financial windfall through the use of a Household Income Change Activity. Household Income Change - Activity Type http://support.implan.com/index.php?option=com_content&view=article&id=434 Do note, you will need to determine if those property owners will remain and (more importantly) will spend their windfall in the region. So, for your study, the purchase of the land won’t have any economic impact. However, what you do with the land, what you construct on it and the way the profits from the operations of the project are spent, those can all be modeled in the software. Hope this helps! Thanks, -IMPLAN Staff
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    alantsberg
    it helps tremendously and even anticipated a follow on question. I guess I just write about the land sales in the narrative and keep it outside of the model.
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    IMPLAN Support
    Great; I'm glad you were pleased with the response! -IMPLAN Staff

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