Question & AnswerQ&A (DAR ADMINISTRATIVE ORDER NO. 17)
Comparable Sales (CS) refers to the average of three comparable sales transactions within the same municipality or province, involving lands similar in topography, land use, and productivity, occurring between 1985 and June 15, 1988.
CA is relevant when the property subject of acquisition was acquired through purchase or exchange between 1985 and June 15, 1988, and its condition remains substantially similar at the time of acquisition.
MVM is obtained by dividing the loan or mortgage value by 70%. If the mortgage value is not available on documents, a sworn certification from the mortgagee bank shall be obtained.
CNI = [(AGP) x (SP - CO)] x 0.20, where AGP is one year's average gross production, SP is the average selling price for the last 12 months, CO is the cost of operations, and 0.20 is the capitalization rate.
MV is adjusted for inflation using the Consumer Price Index (CPI) from the date of the most recent tax assessment before August 29, 1987, up to the time of actual coverage.
LV = (CS x 0.3) + (CNI x 0.4) + (MV x 0.3), where LV is land value, CS is comparable sales, CNI is capitalized net income, and MV is market value per tax declaration.
If CS cannot be obtained and MVM or CA are not applicable, the formula LV = (CNI x 0.55) + (MV x 0.45) is used. If CNI and CS are not available, land valuation is based on MV multiplied by two.
DV shall not exceed the sum of Comparable Sales (CS) and Market Value (MV). When DV is not available, CNI is used instead in the formula.
The Land Bank of the Philippines (LBP) Appraisal Group is responsible for the valuation of improvements, but no compensation is given for improvements made or contributed by the government or farmer beneficiaries.
It took effect ten days after publication on January 12, 1989, and it repealed Administrative Order No. 6, Series of 1989.