Land Value Zones Automation for Land Market Information (Case Study of Desa Nagrak Kecamatan Gunungputri Kabupaten Bogor)

LAND VALUE ZONES AUTOMATION

FOR LAND MARKET INFORMATION

(Case Study of Desa Nagrak Kecamatan Gunungputri

Kabupaten Bogor)

VEVIN S. ARDIWI

J

_AYA

GRADUATE SCHOOL

BOGOR AGRICULTURAL UNIVERSITY

2006

STATEMENT

I, Vevin S. Ardiwijaya, here by stated that this thesis entitled:

Land Value Zones Automation for Land Market Information

(Case Study of Desa Nagrak Kecamatan Gunungputri Kabupaten Bogor)

are results of my own work during the period of January until October 2006 and that it has not been published before. The content of the thesis has been examined by the advising committee and the external examiner.

Jakarta, December 2006

ABSTRACT

VEVIN S. ARDIWIJAYA (2006). Land Value Zones Automation for Land Market Information, A Case Study in Desa Nagrak, Kecamatan Gunungputri, Kabupaten Bogor, West Java, Indonesia. Under the supervision of YULI SUHARNOTO and J. P. TAMTOMO.

In Indonesia it is a reality that terminology of valuation is connoted to several institutions attached with their respective interests. For instance, PBB relates to taxation, BPN terms valuation for expropriation, while banks define valuation in term of credits, etc. PBB has collected transaction values from previous years to assign land value zone. These zone are visualized in Zona Nilai Tanah Map (ZNT map), which is nearly similar to a sketch map. This map is produced through delineation of such zonemanually, performed by the expert. Valuation by BPN in general is not yet applied, however there is a prototype produces by Indonesian Land Assessment Project (INLA Project). This prototype uses the analyzing market data and developing the valuation models. Valuation model consist of value maps with value zones and tables or formulas for valuation of each property.

Based on that condition, this research is intended to develop the determination of land value zones by applying the road type approach and its transaction values to produce automatic land value zone map, with study case in Desa Nagrak, Kecamatan Gunungputri, Kabupaten Bogor. It is then expected that this research will provide a lot of benefits not only to BPN and PBB but also to other interested parties.

The automation includes the preparation of specific data for land value zone and programming by using Avenue Script of ArcView 3.2 and its Spatial Analysis Extension. In this automation, the expert influences are minimized. As the result, the validation process verifies every block of the land zone. Based on the pattern of shape and location, the verification result of the land value zone automation compared with the land value zone (ZNT) from PBB.

LAND VALUE ZONES AUTOMATION

FOR LAND MARKET INFORMATION

(Case Study of Desa Nagrak Kecamatan Gunungputri

Kabupaten Bogor)

VEVIN S. ARDIWIJAYA

A Thesis submitted for the degree of Master of Science Of Bogor Agricultural University

MASTER OF SCIENCE IN INFORMATION TECHNOLOGY

FOR NATURAL RESOURCES MANAGEMENT

GRADUATE SCHOOL

BOGOR AGRICULTURAL UNIVERSITY

December 2006

ACKNOWLEDGEMENT

There are many people I should thank in regard to this work and no doubt I will not be able to name them one by one. To these I can but beg forgiveness. I wish to thank my supervisor Dr. Yuli Suharnoto and my co-supervisor Drs. J. P. Tamtomo, M.Eng for they guidance, technical comments and constructive criticism through all months of my research.

I would like to thank to SEAMEO-BIOTROP management and staff, and also IPB post graduate that support our administration, technical and facility. To my friends in the same boat , I really appreciate our togetherness, our 24-hours-a-day works, and how we support each other to finish our study right on time. Finally I feel deeply indebted to my dear husband, Herry Nugroho, for his moral support and patience during the course. I dedicate this thesis to my college ITB, and my lovely country Indonesia.

Research Title : Land Value Zones Automation for Land Market Information (Case Study of Desa Nagrak Kecamatan Gunungputri Kabupaten Bogor)

Name : Vevin S. Ardiwijaya Student ID : G.051020081

Study Program : Master of Science in Information Technology for Natural Resources Management

Approved by, Advisory Board

Dr. Yuli Suharnoto Supervisor

Drs. J. P. Tamtomo, M.Eng Co-supervisor

Endorsed by,

Program Coordinator

Dr. Ir. Tania June, M.Sc

Dean of Graduate School

Prof. Dr. Ir. Khairil A. Notodiputro, MS

Date of examination: December 15, 2006

CURRICULUM VITAE

Vevin S. Ardiwijaya was born in Bandung, West Java, Indonesia at October 30, 1970. She received bachelor degree from Bandung Institute of Technology, Departement of Geodesy, in 1995. From the year of 1996 to 1998, she worked for Urban Land Information System

(SITP) Bappeda Kotamadya Semarang as Geographic Informat ion System Staff in PT. Sarkindo Mulia. Since 1998 to present, she works in

National Land Agency Republic of Indonesia (BPN-RI).

In the year of 2002, Vevin S. Ardiwijaya pursued his graduate study. She received her Master of Science in Information Technology for Natural Resources Management from Bogor Agriculture University in 2006. Her thesis was on Land Value Zones Automation for Land Market Information, a Case Study in Desa Nagrak, Kecamatan Gunungputri, Kabupaten Bogor .

TABLE OF CONTENTS

Page

STATEMENT i

ACKNOWLEDGEMENT . ii

CURRICULUM VITAE iii

ABSTRACT .. iv

TABLE OF CONTENTS . . v

LIST OF TABLES . vii

LIST OF FIGURES . ... viii

LIST OF APPENDIXES ... ix

I. INTRODUCTION ... 1

1.1. Background ... 1

1.2. Scope of Research .. 4

1.3. The Objectives of Research ... 5

II. LITERATUR REVIEW 6

2.1. Land Value .. . .. 6

2.2. Principles of Land Valuation .. 8

2.2.1. Concept and Principles of Value .. 8

2.2.2. Principles of Valuation . 9

2.3. Principles for Land Value Zones . ... 11

2.4. Land Valuation by PBB and BPN .. 13

2.5. Geographic Information System 19

III. METHODOLOGY ... 22

3.1. Time and Location . 22

3.2. Data Sources . .. 23

3.3. Hardware and Software . . 23

3.4. Flow of Thought .. .. 23

3.4.1. Data Collection Method .. 25

3.4.2. Value Zoning Automation .. 26 3.4.3. Land Zone Valuation Process . 28

IV. RESULT AND DISCUSSION . 30

4.1. Data Collection Method .. 31

4.1.1. Preparing Raster and Vector Data .. 31 4.1.2. Determine the Road and Drainage Area . 31 4.1.3. Determine the Road Type .. . 32 4.1.4. Determine the Road Centerline ... 33

4.2. Land Value Data Analysis .. 33

4.2.1. Land Value Zone ... .. 34

4.2.1.1. Land Value Zone by Automation . 34 4.2.1.2. Land Value Zone by INLA .. 35 4.2.1.3. Land Value Zone by PBB 36

4.2.2. Land Value .. 38

4.2.3. Transaction Value ... . 42

4.2.4. Properties . 44

4.3. Validation Process of Land Value Zones .. 46

4.4. Research Validation .. . 46

V. CONCLUSIONS AND RECOMMENDATIONS .. 50

5.1. Conclusions .. . 50

5.2. Recommendations .... . 50

REFERENCE . .. 52

LIST OF TABLES

No Caption Page

1. Spatial Data Requirement ... .. . 25

2. Land Value Zones Comparisons ... .... 37

LIST OF FIGURES

No Caption Page

1. Illustration of the parcels located in 2 or more value zones .. 18

2. Several Component Comprise a GIS .. 19

3. GIS Process . 20

4. Study Area 22

5. Flow of Thought ... .. 24

6. Unclean Block ... 27

7. Splitting Process .. 27

8. Clean Block . 27

9. Procedure of Land Zone Valuation... ... 29

10. Raster and Vector Data ... 30

11. The Road and Drainage Area .. 31

12. Overlay Parcel and Block ... 31

13. Clean Block .. 32

14. Road Centerline 33

15. Scheme of Data Analysis 34

16. Land Value Zone . 35

17. Value Zone Map by INLA Project . 35

18. ZNT Map from PBB ... 37

19. Properties .. .. 45

20. Block Pattern of Zone 1 .. 47

21. Block Pattern of Zone 2 .. 48

22. Block Pattern of Zone 3 .. 48

LIST OF APPENDIXES

No. Title of Appendix Page

1. The Procedure to Create Land Zone ... . ... 55

2. Model to Create Land Zone .. ... .. 59

3. Avenue Script for Automation Program . 64

4. Transaction Value Analysis . 69

I.

INTRODUCTION

1.1. Background

Characteristics of land in economic sense are defined as the entire material universe outside of people themselves and the products of people. It includes all natural resources, materials, airwaves, as well as the ground. All air, soil, minerals and water is included in the definition of land. Everything that is freely supplied by nature, and not made by man, is categorized as land [Gwartney, 1999].

Land holds a unique and pivotal position in social, political, environmental and economic theory. Land supports all life and stands at the center of human culture and institutions. All people, at all times, must make use of land. Land has no cost of production. It is nature's gift to mankind, which enables life to continue and prosper.

Land's uniqueness stems from its fixed supply and immobility. Land cannot be manufactured or reproduced. Land is required directly or indirectly in the production of all goods and services. Land is our most basic resource and the source of all wealth.

Regarding to the uniqueness, the land needs to be managed to get more value added. The land is natural resources that may be developed a potential resource for human prosperity.

There are several authorities dealing with land issues. National Land Agency (BPN) is responsible for land management and registration concerning urban and agricultural land according to article 2 of Basic Agrarian Law (BAL), Act Number 5/1960. In President Regulation Number 36/2005 and 65/2006 both

are on regard with land acquisition for public use, BPN is currently authorized to conduct land valuation in connection with land acquisition. Prior to the enforcement of these regulations, BPN is active in work connected with expropriation in this regard. In general, the expropriation values are higher than taxation value (in Indonesia it is known as NJOP, an abbreviation of Nilai Jual Obyek Pajak) and reported prices. These values may also be higher than the market values.

The Directorate of Land and Building Tax, Directorate General of Taxation (in Indonesia it is known as PBB, an abbreviation of Pajak Bumi dan Bangunan) has developed valuation method to determine taxes. The NJOP for land decided by PBB are much lower than market values. In average these values are around 40 % of the market values [INLA, 2003]. The reason why NJOP is much lower than market values is because of political reasons. Presumably, this condition may be because majority of our people are low income people, which therefore it gives rise to low tax-paying capabilities. It should be noted that NJOP must be equal to market value, so that this value can be applied to all purposes including land acquisition. If such circumstance occurs, where NJOP is at the same value with market s, it assumed that the government will obtain larger revenue. Alas, the fact that NJOP is lower than market value has become a loophole which is misconducted by number of Notary/PPAT (in Indonesia it is known as PPAT, an abbreviation of Pejabat Pembuat Akta Tanah). Thus, sellers and buyers also report their transaction values merely as the sum of NJOP in order to avoid more taxes and other induced fees. This fact in return cannot increase NJOP towards market values.

With regard to determine NJOP, PBB has collected transaction values from previous year to assign land value zone. These zone are visualized in Zona Nilai Tanah Map (ZNT map), which is nearly similar to a sketch map. This map is produced through delineation of such zone manually, performed by the expert who subsequently provides NJOP for the following year.

Valuation by BPN in general is not yet applied, however there is a prototype produces by Indonesian Land Assessment Project (INLA Project). This method uses the analyzing market data and developing the valuation models. Valuation model consist ofvalue maps with value zones and tables or formulas for valuation of each property.

In Accordance to President Regulation No. 10/2006, there has been formed a new directorate related to the land valuation mandate by BPN. The directorate of Land Potency Survey has responsible for surveying, valuating, and managing the land potencies; there are the physical potencies and the economical values of land.

On the basis of the above mentioned facts, this research is intended to develop the determination of land value zones by applying new approach which results automatic land value zone map. It is then expected that this research provides a lot of benefits not only for BPN and PBB but also for other interested parties. This may be best pictured by the following cases:

a. Prospective buyers need area to build houses; they seek for available potential land zone, but it is very difficult to realize this need due to infrastructures and legal aspect constraints;

b. Developers expand land for houses or apartment to increase functions of land by means of providing comprehensive facilities to improve such area, and also to get the benefit of such ownership;

c. Agro-businesses expand existing farm field to increase their production. d. Industrial sector plans to develop commercial or industrial zone, and are

willing to invest their financial capability to these potential location and reserves for the future.

e. Resources management peoples control land resources to obtain the optimal benefit and for sustainable use.

1.2. Scope of Research

Based on the backgrounds mentioned above, this research develops a method to determine land value zone that formerly has been initiated by INLA Project in another approach. By applying this method, the expected result is to produce automatic land value zone map, as well as to compare to the method applied by PBB.

The case study of this research is in Desa Nagrak, Kecamatan Gunungputri, Kabupaten Bogor, because digital map data from BPN and PBB are already available. In addition, this location possesses transaction value data collected by PBB. Land value zones created in this research is based on road classification, and level of land value zone is assigned by values for the fulfillment land assessment requirements.

1.3. The Objectives of Research

The objective of this research is to develop a prototype of land value zones automation in variety land use area using GIS Technology. The values of land zone are determined by type of road and its transaction value.

II.

LITERATURE REVIEW

2.1. Land Value

As articulated by Longley et al. [2001], there are three basic methods to assign a value of land. These methods also can be used to assign a value of properties:

a. Cost method

Cost method is based on replacement cost of the property and the value of the land. Assessor must examine data on construction costs and vacant land values.

b. Income method

The income method takes into consideration how much income a property would generate if it were rented. This requires details on current market rents, vacancy rates, operating expenses, taxes, insurances, maintenances and other costs.

c. Market method

The market method is the most popular, also in Indonesia. It compares the property to other recent sales that have a similar location, size, condition and quality.

Assessors are responsible for accurately, uniformly and fairly judging the value in jurisdiction. The expert opinion in this research is very necessary. The expert opinion is very subjective in the field, even though very subjective, but the expertise should be involved. In the scope of scientific, the expert opinion is valid. The expert opinion is very independent, means the expert could determine either

the buffering road distance or the land zone valuation process according to the expertise experience, expertise knowledge and the expertise skill [Longley et al, 2001].

Value objects are mostly classified in accordance with the use for which it is established. The four main categories are residential objects, agricultural objects, commercial and industrial objects.

When considering whether a certain type of property should be part of the mass-valuation process, the cost for the appraisal should also be taken into account. The resources put to creating and maintaining separate models for properties that will not be taxed - or to do individual valuations - will to a large degree be wasted if it does not result in any revenue. Types of properties that should not be appraised are for instance:

a. public land (state land) such as parks, streets, roads, water areas; b. cultural and natural reserves;

c. forest land.

Valuation models should describe how the property market thinks and acts , where there are many transactions on the open market, the better chance to capture the market s sentiments. If not, do simulation market situations, i.e. what would a buyer of a certain type of property look for and what would be willing to pay considering what other alternatives.

Different value objects have different valuation models, depending on the description separate market sectors. Different categories of buyers are looking for residential objects, business objects and industrial objects. Totally different

criteria for selecting an object, and criteria is what should be captured in the valuation model for each type of property.

Different criteria for selecting property result in that land for industry is more attractive in some areas, while land for residential purpose in other areas. The influence of location is captured in value maps, with zones showing different market value levels. Each type of value object has a value map, and each zone on the value map is connected to a table, describing how the value for a specific value object or unit should be assessed. The value map, together with tables for all market levels, represents the valuation model for each type of value objects [INLA Project, 2003].

2.2. Principles of Land Valuation 2.2.1. Concept and Principles of Value

Hidayati et al. [2003] argued that anticipation, changes, demand and supply, substitution and balancing are the principles that influence land value of the area. The meaning of this anticipation is the value produced by profit expectation that will be acceptance in the future. The competition between buyers in marketing for a site will give the prices position for the land zone of the area. Demand and supply for a site in certain location of area liable balance, if supply is decrease and demand is constant then the price going to increasing, and also the differing. This principle can not apply in the short term, if the site type very difficult to find in certain location in the area then the pressure from the market competitor will increase to the site price of the area until the profit indication level. The substitution principle explains that a buyer will not pay more for a

certain site compare to another site in the area. While principle balance is the factor or variable that influence to the land value when occur the changes to the elements that influence to the balance.

2.2.2. Principles of Valuation

Assessor identifies properties to give the value and determine the date valuation, the valuation objective, the valuation definition and its scope, and stated on valuation report. Next step is selection and analyze to the data comparator. Include in the valuation process is identification to all properties attribute, legal aspect, physical characteristic, and extent all the potency on the site [Hidayati et al, 2003].

Gwartney [1999] argued that the collected data should be verified with two different sources. Market data should be verified with a person directly involved in the transaction. For example, one party could be the selling agent representing the responsible for the sale. Another party could be the site user who agrees to the sale amount. Additional sources might be government land agents or officials who have first hand knowledge of the sale. Inaccuracies can also be brought to light by concerned citizens if the data is made available to the public.

Nevertheless, in Indonesia it is reality that terminology of valuation is connoted with several institutions attached with their respective interests. For instance, PBB relates to taxation, BPN terms valuation for expropriation, while banks define valuation in term of credits, etc.

The main valuation methods used by PBB are in correspondence with international standards. But the non-transparent market makes the application of

these methods difficult. The NJOP for land decided by PBB are much lower than market values. In average these values are around 40 % of the market values [INLA, 2003].

PPAT are dealing with the transactions. The reported prices are registered. PPAT never examines the sales to find out if the reported prices are the real prices or not. It is not PPAT duty. In general reported prices are lower than market prices but sometimes higher than NJOP.

The banks do land valuation for credits. In so doing they use information from notaries and brokers. They also interview people living in the neighborhood of object for valuation. The banks also build their own databases but some of these databases have not been in digital form yet. The capacity of borrower is more important than valuation object. To value objects for credit with the amount of loan exceeds Rp. 2 billion some banks will use a private valuation company to do this activity.

Brokers and developers conduct land valuation for their own or on demand of customers. The broker in Depok profiles more as an investor and partly also as developer. As an actor in market these entities should have sound knowledge regarding market, and practically they did not use any specific methods other than knowledge of valuation. Developers usually calculate backwards to find out how much they can pay for the land. They start to calculate the receipts and costs for the whole project. Costs for the land will be a part of the total costs.

BPN do land valuation for expropriation. The valuation methods for expropriation are not regulated but the most common way is to try to find sales of comparative properties. Other authorities are also involved in valuation for

compensation. If there is agricultural land with perennial plants, agricultural office will account additional values of the trees or plants for compensation purposes.

In general for many centuries, the role of valuation has been an activity associated with government activity, especially in relation to taxation and property acquisition for public works.

With the industrial revolution and capitalism, the development of major urban areas and increasing demand for housing of workers streaming from the country-side to work in factories, it produced some new faces: industrialists and developers. The people needed financial assistance using land as collateral and the lenders needed advice about the value of that collateral. The valuation was born and it has continued up to the present to be an important part of the property finance business although it is rarely very noticeable to those outside the business area.

2.3. Principles for Land Value Zones

According to INLA Project report, the principles for land value zones are described as below. A land value zone is a geographic area where comparable parcel objects have approximately the same market value. The number of value levels sets the ambition of the valuation model, since each zone covers a range of values around a given norm object value. More levels give smaller ranges.

The ambition of the model is set by the differences in value levels, which will also be evident from the number of zones. One proposal can not be difference in value levels higher than 20% and lower than 10%. The difference in percentage should be smaller for higher values.

The total number of zones will of course be much higher than the number of value levels, since each market value level will be present in many urban areas, sometimes in several locations. The work is a kind of iterative work where there is a need of both knowledge of the market and values of land parcels but also use of reliable sales. It is easiest to start with large roads. The highest prices are found along roads with a lot of traffic or other places where there are a lot of people in movement for example around universities.

There are two different ways to work with the fact that different parcels have different land use in the work with zoning. The market behavior differs due to the type of property. Therefore it can be good to have different valuation zone systems. One possibility is to have valuation zones for agricultural, residential, commercial and industrial units respectively. This way to work with separate value maps for different kind of land use is useful if the planning regulations are strict. With strict planning regulations the permitted land use according to the City Plan is very important. It is also good with separate value maps for different land use if the values are not updated so often. If there is a system with only one land value map it is important that the land use planning has had influence of the zoning. There should also be possibilities to reduce the values for parcels where a change to a higher and better land use is not possible in the short run according to the planning.

Every value zone must have a unique identity. First there can be a letter for type of value zone, for example A for agricultural and R for residential. Then there must be a unique number for region, district and municipality. The last part is a unique number for each value zone in the municipality [INLA Project, 2003].

2.4. Land Valuation by PBB and BPN

Land valuation by PBB based on Letter of Taxation General Directorate No SE-38/P.6/1001 on Manual of NJOP and No SE-06/P.6/1999 on Implementation of Value Zones (ZNT) and Average Indication Value (NIR) as the basis of NJOP. In general, taxation is calculated by NJOP. NJOP is calculated from ZNT and NIR, times area (meter square). The complicated process is ZNT and NIR determine process, when tax assessors have to consider various factors that influence the valuation, such as land class, market value relativity, area development, building, date of transaction, road wide, road access, facility, flood, plan land use, soil fertility and value class.

Since earlier, BPN is obliged to propose land values for two other purposes as well:

a. For establishing equitable compensation in cases of acquisition (expropriation).

b. For establishing the land price in connection with granting of State owned land.

Refer to President Regulation No 10/2006 jo Head of Land National Agency Regulation No 3/2006 and 4/2006 about Organization and Task of National Land Agency, on land valuation issues BPN responsibilities are not only for expropriation and granting of State owned land purposes, but established to surveying, valuating and managing land potencies. The responsibilities are including updating data for parcel value and zone value information, land valuation institutional cooperation, and assessor technical assistances, etc.

In comparison regarding land valuation between PBB and BPN, it can be submitted that BPN is more independent in dealing with land which should take more part in the valuation. There is also a need to develop framework and valuation methods for compensation and other purposes.

According to articles 154-157 of the above-mentioned BPN regulation No 6/2001 the BPN is entitled to provide services in various land related fields including that of land valuation. The BPN makes use of land values in a number of different situations:

a. In order to propose land values for the purpose of taxation e.g. planning, land reform, land registration.

b. In order to propose a second or third opinion concerning land values whenever needed.

Since earlier, and based on other regulations, BPN is obliged to propose land values for two other purposes as well:

c. For establishing equitable compensation in cases of acquisition (expropriation).

d. For establishing the land price in connection with granting of State owned land.

BPN has developed land values from INLA Project for each parcel based on market data. Land values in market value levels can be used for a lot of different purposes. Open access to these values for different organizations and the public contributes to a more transparent real estate market.

According to INLA Project Report, a system for mass valuation of land consists of three main parts; a market data collection system, a valuation system and an assessment system.

The market data collection process has been described above. If there is a need of recurrent market valuation collection of market data is a continuous process.

The second process is the valuation process. At this stage, the researcher analyzes market data and develops the valuation models. If deal with the value factor location through zoning, then this part of the work also is included in the process. The result of the work is valuation models, value maps with value zones and tables or formulas for valuation of each property.

The third process is the assessment. During this process, the researcher collects data about characteristics which is included in the valuation model for all properties that are going to be valued. The valuation models applied to the properties with their characteristics or value factors will result in assessed values.

a. Market data collection

Based on the experience of INLA Project, market data collection must be undertaken. Attempts to determine market values without collection of market data will cause to failure. To collect market data for example information about real prices is difficult in many countries including Indonesia. Transfer taxes and notary fees are based on the reported prices. To avoid tax and fees people involved in real estate transactions do not report the real price to PPAT. The transfer tax in Indonesia is at least in theory high. In practice it is not so high

because people do not report the real transaction prices. The situation is similar for notary fees. It would be better to base fees to notaries on other parameter than reported price for example on assessed value multiplied with some factor or to have some kind of fixed fee per transaction. Similar calculation is also compatible for transfer tax. If people report the real transaction prices the tax rates could be decreased but the state and local authorities receive the same revenues from the taxes.

There will also be problems if carry through a fair valuation with market values for one region but not for others. The relation between the assessed values in the region and market values may be fair. But in comparison with the values in other regions will not be fair, especially not as long as the tax rates are the same.

To find information about real prices, interested parties have to use other sources than reported prices from PPAT. In urban areas this can be done through advertisements. PBB partly uses this way to work. In rural areas advertisements are not a common way. To get more information on real price, interview with buyers or people such as head of village in rural areas is more effective.

The quality of the collected market data is very important for the valuation. There is general rule "garbage in garbage out . If collected information about prices and characteristics for sold properties is not reachable, the result of the valuation will probably be the same.

b. Value zoning

INLA Project performs value zoning through a process. The process is a kind of iterative work where there is a need of both knowledge of the market and

values of land parcels but it also use reliable sales. It start with large roads. The highest prices are found along roads with a lot of traffic or other places where there are a lot of people in movement. For every value zone there shall be a set up of rules for the valuation of parcels belonging to that value zone. Firstly the norm value for the standard plot in Rupiah/m2.

The principle of value zoning: The influence of location is dealt with value zoning. Each value zone has a unique identity. Value of land zones determined by delineation the same market data. Therefore the value zone will be shown in the value maps.

c. Value for an individual parcel

The next process after value zoning is how to calculate value for an individual parcel. The other value factors shall be used. To set up valuation rules for a certain value zone in the study area is as the following:

Norm value 600.000 Rupiahs/m2 1) Road class 1,0 / 0,6 / 0,3 2) Land use 1,0 / 0,8 / 0,6 3) Infrastructure 1,0 / 0,8 / 0,6

To calculate the value for an individual parcel the formula will be the following: Value of the parcel = (Norm value) * Size * (Road class factor) * (Land use class

factor) * (Infrastructure class factor)

If the parcels locate in 2 (two) or more value zones, the value of parcel will be calculated as follow:

Figure 1. Illustration of the parcels located in two or more value zones

Value of the Parcel A = {(Norm value zone 1) * Size} * (Road class factor) * (Land use class factor) * (Infrastructure class factor) Value of the Parcel B = {(Norm value zone 1) * Size zone 1} + ((Norm value

zone 2) * Size zone 2}} * (Road class factor) * (Land use class factor) * (Infrastructure class factor)

Where: Parcel A in one value zone, Parcel B in two value zones

The result of INLA Project: The model does not focus on all value factors affecting market value. Some factors are not common way, or sometimes the value factor is of exceptional proportion, and is therefore excluded from the model. If this affects market value significantly, than there are possibilities to adjust the value derived from the model. For adjustments there is a need of manual work. This is costly and there can be rules for when adjustments shall be possible to carry through.

Zone 1 Zone 2

Parcel A Parcel B

2.5. Geographic Information System

Geographic Information System is a set of hardware, software, geographic data and people, designed efficiently for collecting, storing, updating, manipulating, analyzing, and presenting for all information geographic referenced [ESRI, 1995].

Geographic information System is a general purpose tool, contain several maps illustrating a few of the many GIS application.

Figure 2. Several Component Comprise a GIS [SEAMEO BIOTROP, 2004]

Geographic Information System is information system to manage data that has spatial information. In specific term, the GIS is computer system that has the ability to build, restore, manage, and to display the information based on geographically, such as the data that identified based on location in a database, the user who involves building and operating is part of this system. Basically the entry data process shown in the following figure: [SEAMEO BIOTROP, 2004].

Abstraction or Simplification

GIS

Software

tools Database

The Real World

User

Figure 3. GIS Process [SEAMEO BIOTROP, 2004]

As articulated by Bruce [1996], spatial data as data that occupies cartographic (map able) space and that usually has specific location according to some geographic referencing system (e.g., Latitude-Longitude) or address. Spatial data are data defined by physical characteristics, usually including location or position. Spatial data may simply give an address (a specific location), or they can define size, such as a certain area of a forest (which is the same as defining the various positions of boundaries). The illustration shows a database containing addresses and a map (lower left) showing the area. Both the database and map represent spatial data.

The addresses in the database are locational, and are therefore considered spatial data. The map is based on location, so it, too, is spatial. The owner name and value of the property are non-spatial data. They are descriptive characteristics called attribute . Many attributes are not location-specific but are mean to offer description about the spatial data or something that occurs at the location. For examples, Mr. X is the owner of one address, but he couldn t own, or move to,

another address. The address doesn t change, but the attribute (owner) might. GIS data set usually contains spatial data and associated non-spatial data.

GIS data comes from a variety of sources: digitization of maps (electronic copying), tabular data such as census lists, remote sensing imagery, user input (typed-in data), existing reports (e.g., soil surveys), and digital products (e.g., digital line graphs sold in some countries). These diverse sets of data (upper illustration) are not naturally combined. It is difficult to hold up a satellite image, for instance, and compare it to a list of agricultural sites, they do not integrate easily.

All these data sets must go somewhere for GIS use, and that place is the database a program that stores and manages data. The database contains data and may point to other data sets, such as satellite imagery. A major strength of GIS is that it can accept and merge diverse data into a single database, giving the user a flexible and powerful set of data from which to work.

Database in GIS is a simple concept a list or table of data arranged as columns (categories of data) and rows (each observation entry). Columns are called fields , whereas rows are records .

III.

METHODOLOGY

3.1. Time and Location

This study was conducted from January - September 2006, in Desa Nagrak, Gunungputri Sub District, Bogor District, West Java Indonesia. The coordinate location in TM-30 zone 48.2 datum WGS-84 is A (251,592.00 ; 781, 915.14), B (250,121.85 ; 792,001.88), C (248,331.51 ; 792,081.46), D (247,183.42 ; 793,519.41), E (248,581.59 ; 795,542.77).1 Data analysis was carried out at the MIT (Master of Science in Information Technology) Program, Bogor Agricultural University (IPB), SEAMEO-BIOTROP.

Figure 4. Study Area

(Source : Kantor Pertanahan Kab. Bogor, 2002)

1

The coordinate location in geographic coordinate datum WGS-84 is A (106059 49.9176 ; -6022 36.2460 ), B (106057 11.1600 ; -6024 11.1312 ), C (106056 12.894 ; -6024 8.5932 ),

Bogor District Study Area Desa Nagrak, Gunungputri Sub District, Bogor District

West Java, Indonesia

A

B C

D

3.2. Data Sources

The data involve in the research including: a. IKONOS, data acquisition 2002

b. Parcel Measurement by BPN, data acquisition 1995-2006 and Parcel Sketch and ZNT map by PBB, data acquisition 2005-2006.

c. Analog Data PBB, including transaction value, data acquisition 2005-2006

3.3. Hardware and Software

In this study, it is needed the following supporting tools, in terms of hardware and software:

1. Hardware: PC Pentium-4, 1400 MHz, 256 MB RAM, CD ROM Read/Write Drive 48x24x52x; Canon Pixma iP 1000 Color Printer.

2. Software: ArcView 3.1; ArcGIS 9 Extension Spatial Analysis; Arc/Info 3.5; MS Office 2003; AutoCAD 2000; MapInfo Professional.

3.4. Flow of Thought

The steps of research will be described in the research methodology as showing in figure 5:

Start

Determine Block Area Determine Type of Road

Spatial Buffer Buffering Process

Data Collection Method

Data Analysis

Overlay Process

Valid?

Stop

N

Y

Spatial Clean Block

Valid? Valid?

Split Process

N Y Y N

Map Land Zone Land Zone Valuation

Process Land Zone Data

3.4.1. Data Collection Method a. Data Collection

The research starting with data collection method, as the following:

- For market data collection requirement, the research used the transaction value from PBB, the data collected from January to June 2006 in Desa Nagrak, 150 parcels.

- Digital data; including vector data and raster data. Data requirement for the research as the following: Table 1. Spatial Data Requirements

Layer Type Minimal tabular data

Source

Road centerline

line Id, Road type (primary, secondary, local or no access)

Digitizing and generalization

Road polygon Id, Name Digitizing and generalization River polygon Id, Name Digitizing and generalization Block polygon Id Digitizing and generalization

RR-Area line - The assumption of Road and

Drainage Area Parcel polygon Id, Transaction Value Field Measurements

b. Data Analysis : Land Value Zone Determination

The land value zones determination is based on the accessibility or the road access. They are:

- Zone 1 : primary road access - Zone 2 : secondary road access - Zone 3 : local road

The more explanation to determine the level of land zone and to classify the suitable road will be discussed in chapter 4.

c. Data Analysis : Norm Value of Land Zones

The approach of norm value of land zones utilizes the transaction value of PBB. In the future this approach must be corrected by the market value, with the objective is to get the fair norm value. The parcel value will be calculated by the norm value, the norm value is adjusted by the expert.

3.4.2. Value Zoning Automation

It is different with INLA Project, while the value zoning is done by delineating of market value which has the same classification value. The land value zone in this research by using approach based on the road classification (type of road). The more explanation about the concept design and its implementation in ArcView and the comparison with the ZNT map from PBB will be discussed in chapter 4.

The concept of the automation methodology can be explained as the following:

a. Splitting Process

To edit the polygons, use the Polygon Split tool to draw a line across a polygon to split it into separate polygons. Splitting process is to get the clean block, it is the locations that can be occupied by someone or an institution, used it physically for instance for a house, a supermarket, a farming, etc. and to be sold to another side that has the relationship with ownership right.

The example of splitting process to make a polygon smaller, use the polygon split tool to simply split off the unnecessary part, select it, and delete it. 1. Overlaying the polygon of block and poly-line of fence.

2. The next process after overlaying polygon of block and poly-line of fence, then do the spliting process.

Figure 7. Splitting Process

3. Remove the small polygon area, and then another polygon is the Clean Block (polygon with land value).

Figure 8. Clean Block Small area

Block

Clean Block

Fence

Block

b. Buffering Process

To create a buffer, specify the source feature and the buffer distance. For linear features, the GIS draw a line around the feature at the specified distance. To calculate value zone buffer around roads, specify a distance then GIS draw the buffer width. The specific distance for buffering is given by the expert. The approach distance uses the average wide of the land zone value (ZNT) of PBB, generate as the road centerline. It needs iterative process to get the fair distance. Further this approach needs to be re-adjusted by the expert to get the fair land value zone, but it is not include in the scope of this research.

c. Overlay Process

The utilization of this method is to find which features are inside which areas and summarize the zone values inside one or more areas.

a. Combining two spatial data layers and producing the land zone data from them.

b. Both layers are geo-referenced in the same system.

The input data for overlaying process is the result buffering zones combining with the clean block area, so produce the land zone in some locations that can be occupied, can be used, and can be sold.

3.4.3. Land Zone Valuation Process

Land zone valuation process is a process to give the value to the land zone, it based on the assessor opinion. The assessor opinion refers to the market data,

one of them is the transaction value that consider to the description as the following statement:

According to Gwartney [1999], the data should be verified with two different sources, so it needs to be developed the procedure of land zone valuation, the flow of the procedure as in the following diagram:

There are 150 of transaction value data of Desa Nagrak from PBB, this data is used for the land zone valuation process. The result of the land zone valuation process is used as an approach of norm value land zone. The process of this approach will be discussed later in chapter 4.

Data Collection Data Market

Verify Verify

- National Land Agency - Directorate for

Land and Building Tax

- Selling Agent - Site User - National Land

Agency

Data Transaction Value

Expert Opinion

Land Zone Valuation

IV.

RESULTS AND DISCUSSIONS

4.1. Data Collection Method

4.1.1. Preparing Raster and Vector Data

Based on raster data (IKONOS) used in the research, it can be determining certain study area of the research. The method to determine scope of research area is using the GPS equipment to get the accurate data (rectified image map). The research used raster data to produce vector data by digitizing on screen method. The raster and vector data as the following:

Figure 10. Raster and Vector Data

(Source : Kantor Pertanahan Kab. Bogor, 2002)

4.1.2. Determine the Road and Drainage Area

The information of road and drainage area (in Indonesia it is known as Daerah Milik Jalan and Daerah Bantaran Sungai) was taken from the raster data and vector data. Identification of the study area was doing by field survey. The

result of field measurement used for determining the road and drainage area or to describe the land zone.

Figure 11. The Road and Drainage Area

The assumption of the road and drainage area on the block overlay on the parcel, it is from the field measurement. So the road and drainage area produced from the parcel, further it will be used to get the clean block area.

Figure 12. Overlay Parcel and Block

Figure 13. Clean Block

4.1.3. Determine the Road Type

The road type information was taken from the field survey and taken from the satellite data (IKONOS). From the satellite data, the route of the road in the study area was identified, and it was digitized on screen to produce the new data (road type). In determining the type of the road in Desa Nagrak is not refers to the role of road classification, because the size of study area is small. The process to identify the road type in this research as the following:

a. Primary road is kind of first alternative road route; it is Jakarta-Cianjur-Bandung, this route constructs of blacktop and it has 4 lines and the traffic jam for 24 hours. This route categorized as primary road access (type-1). b. Secondary road is kind of road route, it categorized as secondary road access

(type-2).

c. Local road access is kind of pathway, this route categorized as local road access (type-3).

4.1.4. Determine the Road Centerline

The road centerline was determined from the road type data. This process based on the information taken from the field survey and it was verified on satellite data (IKONOS). The model of road centerline as the following:

Figure 14. Road Centerline

The road centerline is generalization from the road double line, in this research the generalization needs editing process to get the best data of the desire centerline. The reason that this research using the centerline or not uses the double line is because the information from satellite data may be covered by some objects for instance the trees, buildings, clouds, etc.

4.2. Land Value Data Analysis

The data in the research to be analize divided by two, spatial data and non-spatial data. The non-spatial data is the data regarding to location or the area of the research, it is represented by spatial data digital in shape file format or CAD file

format. Non-spatial data is the data regarding to the secondary information, it is represented by tabular data.

Figure 15. Scheme of Land Value Data Analysis

4.2.1. Land Value Zone

4.2.1.1. Land Value Zone by Automation

The land value zone is based on type of the road and also based on the land classification such as agricultural (wet land, dry land, plantation), residential (land for family houses, land for apartments, land for combined use residential).

The land value zone process can be based on the layer of land use, parcel, building, etc. Through this process the expert easier to classify the land zone based on agriculture, residential and easy to fill the norm value on digital land zone map.

This figure is result of land value zone automation, every unique land value zone assigned by norm value. The norm value used in this model is the approach of transaction value.

Non-Spatial Data

Spatial

1. Land Value

2. Transaction Value

3. Properties/Asset Land Value Zone

Figure 16. Land Value Zone

4.2.1.2. Land Value Zone by INLA

The process is a kind of iterative work where need of both of market knowledge and land parcels values, but also use of reliable sales. It is easiest to start with large roads. The highest prices are found along roads with a lot of traffic or other places where there are a lot of people in movement. Land zones determined by delineation the same market data.

The weakness of this model does not take care of all value factors that affect the market value. Some factors are not so common, or sometimes the value factor is exceptional proportion, and therefore excluded from the model. If this affects the market value significantly, than there are possibilities to adjust the value derived from the model. For adjustments, it needs the manual work. This is costly and there can be rules, when adjustments shall be possible to carry through.

..

Figure 17. Value Zone Map by INLA Project

4.2.1.3. Land Value Zone by PBB

Figure 18 is the land value zone from PBB which has the same estimation location (similar) with figure 17 and it is the sketch of map ZNT, it delineated manually by the expert. The expert also determines the process of NJOP and taxation value.

Norm Value:

2.200.000 to 2.500.000 (1) 1.900.000 to 2.200.000 (4) 1.600.000 to 1.900.000 (5) 1.300.000 to 1.600.000 (2) 1.000.000 to 1.300.000 (1)

Figure 18. ZNT Map from PBB

(Source : Kantor Pelayanan Pajak Bumi dan Bangunan Kab. Bogor, 2006)

Zone 4 in figure 16 and 18 is the zone that has no access infrastructure, so in the land zone classification it is categorized as the lowest level zone.

The comparison land value zone between Taxation General Directorate for Land and Building Tax (PBB) and Land Value Zone by Automation:

Table 2. Land Value Zones Comparison

Land Value Zone by Automation Land Value Zone by PBB

No Description No Description

1 Limited variable 1 Complex variable

2 Computerization 2 Manually

3 Simple process 3 Complicated process 4 Fast and inexpensive 4 Slow and expensive 5 The value based on the objective

data (spatial, non-spatial and the spatial analysis), and minimum influenced by the expert opinion.

5 The value based on the expert opinion and it is very dominant from the begining until the end of the process.

6 Not yet applied 6 Already applied for the taxation

Similar Zone - 1 Similar Zone - 2

Similar Zone - 4 Similar Zone - 3

4.2.2. Land Value

According to Gwarney [1999], Hidayati [2003], and some internet cited, the assessment or appraisal process is an organized procedural analysis of data. This procedure involves eight specific phases, each of which contains numerous procedures as below:

a. Defining the Assignment

The goal is to estimate the market value of the study area within a given district. This will include manufacturing enterprises, apartments, commercial enterprises, single family home sites, government land, farms and all other land and natural resources of various descriptions. The assessor should be able to support his estimate of land market. The assessor must define and use specific terminology suitable and pertinent to land appraisal.

b. Determining the Data Required and Its Source

A land market assessment system is based upon data related to land attributes. These data generally include maps; aerial photographs; descriptions of physical characteristics like size, shape, view and topography; permitted uses; economic usefulness; present uses; available utilities; proximity to town centers or employment; and site improvements like streets, curbs, gutters, sidewalks and street lights. Governments have much of this data available in the different agencies.

c. Collecting and Recording the Data

Most governments do not have all of this information available in a single data base capable of analysis. Assessors must determine; 1) what land data and valuation systems currently exist, 2) how effectively they operate, 3) how to build

upon and improve these systems and 4) how to implement procedures for collecting additional data to improve the estimates of land values.

If no effective land revenue systems are in place they can be created in a manner similar to the following. Assessors should ascertain what land data presently exists and how it could be assembled for use in a land valuation system. They should collect and maintain the data needed from any existing records even though it is not currently stored in a single source. They should determine what additional data would be valuable and from what sources it can be obtained. They should develop procedures for collecting any additional data required to determine land market values and the data should be collected for the differences in characteristics for each site.

The data should be displayed in a useful manner such as on a land market value map or a computer printout. In an area with no systems or data in place, simple relationships could be drawn for permitted use (zone), distance to amenities (location), physical characteristics (size, topography, view, and so on) and other significant factors. Data could be collected and analyzed on a neighborhood and type of potential use basis.

Conversations with residents and businessmen could help to define the parameters which people in the local community use to determine favorable land location. An interview might reveal that the distance to transportation, such as a river, roadway or public transportation, weighs greatly in people's minds. Or, other factors may predominate, such as homogeneity of a neighborhood or distance to shopping and schools. Planners, government officials, real estate agents, appraisers and others involved in real estate may also provide useful data.

Even if no land sales or market evidence exists, the specific factors which influence land market value are well understood by most people in study area, even in primitive cultures. The assessor's job is one of skillfully determining the relative priorities identified by local people.

A sample of typical and varied land sites within a city could be selected to demonstrate a land valuation system. Based upon a study, land market values could be assigned by a competent assessor. The assessor could use a few people trained to collect and analyze existing data, then analyze the sample survey data and set standards for the base market values in the study area. The difference in market value of the attributes that enhance or detract from a typical site could be added or subtracted to the base market value for the other sites in the study. These features should be recorded on the land market map, which would show the primary sites with markets declining as desirability decreases or increasing as desirability increases.

Several examples of land assessment systems will be discussed in this paper, from a simple example with no significant land data, to a more complex example with plentiful land data. The methods employed will depend upon the land market data that currently exists and how that data can be assembled for use in a land assessment system.

d. Verifying the Data

Since the appraisal process is an opinion of market value that is not based upon the personal experience of the assessor, the data collected should be verified with two different sources. Market data should be verified with a person directly involved in the transaction. For example, one party could be the selling agent

representing the responsible for the sale. Another party could be the site user who agrees to the sale amount. Additional sources might be government land agents or officials who have first hand knowledge of the sale. Inaccuracies can also be brought to light by concerned citizens if the data is made available to the public.

e. Analyzing and Interpreting the Data

The balance of this report will be concentrated on various methods of analyzing and interpreting land market data. Several methods will be suggested to secure the goal of estimating the market value of study area sites.

f. Estimating the Market Values

Once the analysis has been concluded, it will be possible for the assessor to make a rational estimate of the market value of study area site. This estimate will serve as the basis for the value that will be paid by a site user for the exclusive use of a location (site). The assessor would assign preliminary land value estimates based upon the comparative estimated usefulness and desirability of the sites. Initially, they could accomplish this task in a general manner, with the understanding that refinements would be made to reflect new information and public opinion.

g. Public Examination and Analysis of the Land Market Values

The preliminary land value assessment, estimated for each site, could then be displayed on a land market map. Public examination and analysis of the land market values for land sites would help to clarify any errors in assessments. People who occupy land acquire skills in noticing slight differences in land characteristics. They can explain to the assessor why and how differences should be reflected in the conclusions about land values.

Once an adequate sample survey has been completed and had favorable public review, the result can be used throughout the total area. These sample data results could be used to estimate the comparative markets of each land site. To ensure the optimal and equitable use of land sites, land assessments should reflect the attitudes of the individuals who can make the highest and best use of the site, who would be willing to pay more than individuals with inferior uses in mind. Neither requiring nor willing to pay the land taxes for a superior site will use another site that match the needs, desire and budget, thus making it available for others who can pay for the better site.

h. Periodic Updating of Assessments

Land market values tend to increase each year at a rate usually greater than inflation. Building values tend to decline each year, because of a wearing out of the physical structure or its functional desirability. If assessments are not maintained on a regular basis (annually) land will become greatly under-assessed and buildings will be over-assessed in only a few years.

4.2.3. Transaction Value

The transaction value according to PBB, it is determining the value from accumulation of all properties inside of the parcel such as land itself, building, utility (telephone, power line, gas, etc), trees, fence, and the other assets. This is already verifying by analog data analysis that has the relationship with the transaction data value as the following table:

Table 3. Transaction Value from PBB TRANSACTION VALUE LAND SIZE NJOP of LAND BUILDING SIZE NJOP of BUILDING

NJOP STATISTICS

27,100,000 60 243,000 21 595,000 27,075,000 Greater than 139,691,000 128 802,000 45 823,000 139,691,000 Equal 299,260,000 250 802,000 120 823,000 299,260,000 Equal 299,260,000 250 802,000 120 823,000 299,260,000 Equal 121,245,000 105 802,000 45 823,000 121,245,000 Equal 141,484,000 121 802,000 54 823,000 141,484,000 Equal 288,480,000 180 916,000 103 1,200,000 288,480,000 Equal 30,900,000 300 103,000 - - 30,900,000 Equal 188,500,000 250 394,000 - - 98,500,000 Greater then 251,405,350 63 1,416,000 128 2,200,000 370,808,000 Less than 206,125,000 50 1,032,000 100 1,200,000 171,600,000 Greater then 239,000,000 144 1,032,000 76 1,200,000 239,808,000 Less than 239,808,000 144 1,032,000 76 1,200,000 239,808,000 Equal

(150 records)

Statistics:

Greater than 45 30%

Equal 69 47%

Less Than 35 23%

Total 149 100%

The information from table and statistic explained that the transaction value from PBB is the value of property. The transaction value is consisting of the value of land and also the value of building. This information represent that the transaction value equal with the NJOP is 47%. Greater than is 30%, it shows that

the transaction value not yet include of the other value of properties like building, plantation, the ownership, etc. Another perception, this is indicate that there is political strategy to decrease the value of the object in order to get low tax price and there is the ability to pay.

NJOP of Land in Table 3 describes as the data reference for the expert to appraise the norm value of the land zone. Based on the statistic analysis above not each NJOP of the land can be used, it is only equal and less then value can directly used. For the statistic analysis that has the greater than value, it has to be more analyzed, for instance it is only for the data that has the different not more then 10% can be used.

4.2.4. Properties

After analyzing process of transaction value from PBB, it can be concluded that the transaction value is the value for property. It stated in table 3, the value stated not only the land value. The following is the explanation of property:

Richmond [1994] argued that the terms property is also used to signify land and building . Building or roads or paths are constructed upon land, they become part of the land, although it is common practice to refer to land and buildings .

Figure 19. Properties

Property as a medium for investment differs considerably in its qualities and characteristics compared with the other investment outlets previously mentioned. It is naturally limited in supply and it would be extremely difficult and expensive to create additional land to meet expanding requirements. No two pieces of land are exactly alike in every respect. The land will differ in size, topography, locality and condition. Property will not be available in regular units for investment as are stocks and share.

The data including in property subject are:

a. Site; wide and size, shape, contour, soil type, elevation, zoning, etc. b. Building:

- Main building; wide and size, design, layout, construction, material, roof, ceiling, floor, wall, etc.

- OLI (other land improvement); fence, security post, internal road, yard, garden, drainage, water treatment, etc.

4.3. Validation Process of Land Value Zones

Validation process is executed by assessor. The validation process performs in some processes of the automation land zone value; they are in stage buffering process, splitting, and land zone valuation process. In the buffering process, the validation is to do re-adjustment for the buffer distance. In the splitting process, the validation is to do the verification for the real block boundary. In the land zone valuation process, the validation is to do re-adjustment for the norm value. These all processes necessary to do to get the fair land value.

The objective of this process is to do the validation of the unique land zone valuation as the goal of the research. The land zone valuation is based on characteristic condition and location of the study area. Land zone characteristic were very influences significantly to the land valuation, and its very dependency to the expert opinion. In this part, the experts do the validation process to determine every block of the unique land zone.

The land value is very dynamic, it is fluctuation and it is depends on the function of the land, regulation, inflation, etc. Only the expert can determine the fluctuation of land value. The research acceptability shows the similarity graphic pattern, it means that the research is valid.

4.4. Research Validation

This research needs more validations in the land value system. Result of the research in study area can be used as a standard. The prototype can perfected with the following suggestions:

a. The category of road type in the study area must indicate the standard of road type, for instance standard from Department Kimpraswil.

b. The ideal land zone valuation taken from 2 sources (in chapter 3.4.3 Land Zone Valuation Process). In this research the land zone valuation taken from transaction value of PBB only.

c. The more accurate link between the BPN parcels with the parcels sketch of PBB will be very helpful for approach of the norm value land zone. The fact prove after testing 150 data transaction value it is only 22 can be identified in BPN parcels.

The final product of this research is the automation digital data of the land value zone (figure 16), where the buffer of the road type-1 is 100 meters, type-2 is 50 meters, and type-3 is 50 meters. The research analysis shows the result of the automation has the similarity pattern with ZNT sketch map of PBB in figure 17, with the graphic patterns as the following:

Zone 1

0 10,000 20,000 30,000 40,000 50,000 60,000

1 2 3 4 5 6

Block

A

r

e

a _Valuezone

ZNT Map

Zone 2 0 20,000 40,000 60,000 80,000 100,000

1 2 3 4 5 6

Block A r e a _Valuezone ZNT Map

Figure 21. Block Pattern of Zone 2

Zone 3 Valuezone ZNT Map 0 2,000 4,000 6,000 8,000 10,000 12,000 Block A re a

Figure 22. Block Pattern of Zone 3

Zone 4 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000

1 2 3 4 5

Block A r e a _Valuezone ZNT Map

Figure 23. Block Pattern of Zone 4

The graphic patterns in figure 20 to figure 23 give the information as the following statements:

a. Buffer distance in zone 1 larger than ZNT PBB b. Buffer distance in zone 2 close enough to ZNT PBB

c. Buffer distance in zone 3 moreover than ZNT PBB d. Zone 4 less over than ZNT PBB

To get the similar land value zone with the ZNT PBB, the buffer distance in road type-1 and road type-3 must be decreased. This is a sample of estimation that must be done by an assessor or an expert in determining the range buffer distance of the road type. It is the same case for determining the norm value of the land value zone to get the real value.

V.

CONCLUSIONS AND RECOMMENDATIONS

5.1. Conclusions

This research is a comparative study between Land Value Zone Automation, INLA Project, and land zone value map from PBB. The following conclusions can be drawn from this research:

1. Land value zone can be determined automatically in type of road approach using GIS Technology. In this research, the values of land zone are determined by type of road and its transaction value. Based on the pattern of shape and location, the result of the land value zone automation has the similarity with the land value zone (ZNT) from PBB.

2. Based on the research findings, the identified benefits of this research are: (a) Land Value Zones Automation may simplify land valuation process because of the use computerization with limited variables; (b) Land Value Zones Automation reduces expert (human) influences; (c) Because of computerization and minimum expert influences, the automation could be speed up and inexpensive.

5.2. Recommendations

After conducting the research and performing the land value zone process, it can be stated as the following recommendations:

1. Land Value Zone Automation needs to be implemented in BPN, because it can be used as an evaluation or an appraisal tool for all customers, for instance PPAT, Banks, Brokers, and Developers.

2. Because of the Land Value Zone by PBB and INLA Project have been implemented, but they are not as the expectation, so the Land Value Zone Automation is suggested as the new method to be implemented in BPN. It can be used by BPN as an alternative to determine the land value zone for the location.

3. Method of this research should be modified, if it will be implemented in another location or the large scale location.

4. For the location that has very large block, for instance villages, agricultural, plantation, and forest, it is possible to be applied by using double buffer method in determining the land value zone.

5. For another location the research should consider the location that has the similarity characteristic with the road and drainage area, for instance the pipeline of gas, the high voltage of power line, the conservation area, etc. 6. It needs the link between BPN and PBB to get the accurate data parcel

and sketch.

7. It needs the development of the automation application in the future, including determining land value zone, determining individual parcel value, and determining the assessment.

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Dirjen Pajak, 1991, Surat Edaran Direktur Jenderal Pajak No: SE-38/PJ.6/1991, 29 April 1991 tentang Tata Cara Penyusunan Klasifikasi NJOP atas Bumi/Tanah. Direktorat Jenderal Pajak, Jakarta

, 1993, Surat Edaran Direktur Jenderal Pajak No; SE-38/PJ.6/1993, 30 Juni 1993 tentang Petunjuk Teknis Pengukuran dan Identifikasi Objek Pajak Bumi dan Bangunan, Direktorat Jenderal Pajak, Jakarta.

, 1998, Keputusan Direktur Jenderal Pajak No: KEP-16/PJ.6/1998, 30 Desember 1998 tentang Pengenaan Pajak Bumi dan Bangunan, Direktorat Jenderal Pajak, Direktorat PBB dan BPHTB, Jakarta.

, 1999, Surat Edaran Direktur Jenderal Pajak No: SE-06/PJ.6/1999, 5 Pebruari 1999 tentang Pelaksanaan Analisa Penentuan Zona Nilai Tanah (ZNT) dan Nilai Indikasi Rata-rata (NIR) Sebagai Dasar Penentuan NJOP Tanah. Direktorat Jenderal Pajak, Jakarta.

, 2000, Keputusan Direktur Jenderal Pajak No: KEP-533/PJ/2000, 29 Desember 2000 tentang Petunjuk Pelaksanaan Pendaftaran, Pendataan dan Penilaian Objek dan Subjek Pajak Bumi dan Bangunan dalam Rangka Pembentukan dan atau Pemeliharaan Basis Data SISMIOP (Sistem manajemen Informasi Objek Pajak), Direktorat Jenderal Pajak, Jakarta.

ESRI. 1995, Understanding GIS The ARC/INFO Method, John Wiley and Sons Inc, New York, USA.

Establishing the Value of Land - [cited 2006 June 23]; Available from:

http://www.agr.gov.sk.ca/

Gwarney, T, 1999, Estimating Land Values. [cited 2006 June 23]; Available from: http://www.henrygeorge.orgted.htm.htm/

Hidayati, W, Harjanto, B. 2003. Konsep-konsep Penilaian Property First Edition. BPFE-Yogyakarta, Yogyakarrta.

Indonesian Land Assessment Project, 2003, Land Valuation Methodology. National Land Agency Republic of Indonesia, Jakarta.

Presiden Republik Indonesia, 2006, Peraturan Presiden Nomor 10/2006 tentang Badan Pertanahan Nasional. Sekretariat Negara, Jakarta. Land & Property - [cited 2006 June 23]; Available from:

http://www.lands.nsw.gov.au/Department of Lands - NSW Land Values.htm

Land Valuing Problems - [cited 2006 June 23]; Available from: http://www.henrygeorge.org/

Longley, P.A., Goodchild, M.F., Maguire, D.J., Rhind, D.W. 2001. Geographic Information System and Science. John Wiley & Sons, LTD., Buffins Lane, Chichester, West Sussex PO19 1UD, England.

Ruslan, 2003, Pemanfaatan Data Citra satelit IKONOS untuk Penentuan Jenis Penggunaan Bangunan dan Luas Objek PBB, Thesis, Program Pasca Sarjana UGM, Yogyakarta.

Richmond, David. 1994, Introduction to Valuation, Third Edition. Macmillan Press LTD, Houndmills, Basingstoke, Hampshire RG21 2XS.

Sanjoto, Fadjar, 2003, Pengukuran Luas Bidang Tanah pada Citra Ikonos (Studi Kasus di Wilayah Kerja Kantor Pelayanan Pajak Bumi dan Bangunan Jakarta Selatan II), Thesis S-2 UGM, Yogyakarta. SEAMEO BIOTROP, 2004, GIS Basic Training. SEAMEO BIOTROP,

APPENDIX 1

The Procedure to Create Land Zone

1. Display the Layer Road Centerline base on type of road:

2. Buffer for all the road type. Buffer distance determine by assessor/expert. The result will be layer Buff1 of type 1, layer Buff2 of type 2 and layer Buff3 of type 3.

Buff1 Buff2 Buff3

(100 m) (50 m) (50 m)

3. Union for Buff1, Buff2 and Buff3 by the following steps :

70

42,886,000 523 82,000 - - 42,886,000 equal

42,886,000 523 82,000 - - 42,886,000 equal 150,180,000 105 916,000 45 1,200,000 150,180,000 equal 278,379,200 128 802,000 99 1,200,000 221,456,000 greater than 288,480,000 180 916,000 103 1,200,000 288,480,000 equal

- 803 1,274,000 54 365,000 1,042,732,000 less than 133,215,000 105 916,000 45 823,000 133,215,000 equal

24,429,000 108 128,000 21 505,000 24,429,000 equal 34,095,000 108 200,000 21 595,000 34,095,000 equal 124,668,000 180 1,032,000 97 1,200,000 302,160,000 less than 286,566,000 159 1,274,000 70 1,200,000 286,566,000 equal

33,372,000 324 103,000 - - 33,372,000 equal 20,000,000 106 200,000 42 505,000 42,410,000 less than 27,005,000 200 82,000 21 505,000 27,005,000 equal 32,205,000 108 200,000 21 505,000 32,205,000 equal 85,152,450 214 916,000 193 1,200,000 427,624,000 less than 223,500,000 144 916,000 76 1,200,000 223,104,000 greater than

- 43 802,000 - - 34,486,000 less than 86,759,000 62 802,000 45 823,000 86,759,000 equal 128,040,000 90 916,000 38 1,200,000 128,040,000 equal 349,500,000 160 1,274,000 96 1,516,000 349,376,000 greater than

22,000,000 110 200,000 - - 22,000,000 equal 187,770,000 105 1,274,000 45 1,200,000 187,770,000 equal

52,000,000 500 103,000 - - 51,500,000 greater than 22,000,000 210 103,000 - - 21,630,000 greater than 318,800,000 136 1,274,000 96 1,516,000 318,800,000 equal 214,725,000 120 916,000 88 1,200,000 215,520,000 less than 218,010,000 200 802,000 70 823,000 218,010,000 equal 439,446,000 279 1,274,000 70 1,200,000 439,446,000 equal 14,014,000 11 1,274,000 - - 14,014,000 equal 171,208,000 92 1,274,000 45 1,200,000 171,208,000 equal 267,456,000 144 1,274,000 70 1,200,000 267,456,000 equal 108,000,000 180 1,032,000 90 1,200,000 293,760,000 less than 223,500,000 144 916,000 76 1,200,000 223,104,000 greater than 259,034,238 146 916,000 76 1,200,000 224,936,000 greater than 395,924,000 226 1,274,000 90 1,200,000 395,924,000 equal 163,493,750 105 916,000 59 1,200,000 166,980,000 less than 574,275,000 300 1,147,000 243 1,516,000 712,488,000 less than 168,000,000 105 916,000 63 1,200,000 171,780,000 less than 597,272,728 200 1,147,000 202 1,516,000 535,632,000 greater than 152,712,000 135 802,000 54 823,000 152,712,000 equal 144,692,000 125 802,000 54 823,000 144,692,000 equal

47,209,091 95 243,000 27 505,000 36,720,000 greater than 41,672,728 96 243,000 21 505,000 33,933,000 greater than 33,920,000 64 243,000 21 505,000 26,157,000 greater than 40,218,182 91 243,000 21 505,000 32,718,000 greater than 34,920,000 60 243,000 21 505,000 25,185,000 greater than 57,027,273 134 243,000 27 505,000 46,197,000 greater than

47,754,546 135 243,000 21 505,000 43,410,000 greater than 39,427,273 84 243,000 21 505,000 31,017,000 greater than 75,648,800 72 243,000 36 505,000 35,676,000 greater than 212,000,000 144 1,032,000 76 823,000 211,156,000 greater than

41,200,000 400 103,000 - - 41,200,000 equal 233,904,000 144 916,000 85 1,200,000 233,904,000 equal 240,000,000 144 1,032,000 76 1,200,000 239,808,000 greater than

27,000,000 1,000 27,000 - - 27,000,000 equal 51,500,000 500 103,000 - - 51,500,000 equal 1,200,660,000 520 1,274,000 355 1,516,000 1,200,660,000 equal 362,800,000 200 1,274,000 90 1,200,000 362,800,000 equal

greater than

45

30

%

equal

69

46

%

less than

35

23

%

72

APPENDIX 5

TESTING & VALIDATION PROCESS

Figure 24. Testing Process

Table 4. Testing Process

Zone

Valuezone (m2)

ZNT Map (m2)

Notes

1

56,840

20,700

14,710

7,677

54,020

1,633+7,506+1,320+

3,803+11,560

6,652

3,803

1,458

15,790

6,662

24,540

5,490+4,103

2

22,130

38,030

22,020

14,930+2,334

12,110

6,859

54,930

88,910

150,800

30,150

Reject - blunder

10,700

14,550

1,685

4,243

3

11,100

8,995

4

136,900

9,360

Reject - blunder

11,360

23,640

32,410

60,820

1,664

3,150+3,941+721

39,010

10,910+

Zone 1 0 10,000 20,000 30,000 40,000 50,000 60,000

1 2 3 4 5 6

Block A r e a _Valuezone ZNT Map

Figure 25. Block Pattern of Zone 1

Zone 2 0 20,000 40,000 60,000 80,000 100,000

1 2 3 4 5 6

Block A r e a _Valuezone ZNT Map

Figure 26. Block Pattern of Zone 2

Zone 3 Valuezone ZNT Map 0 2,000 4,000 6,000 8,000 10,000 12,000 Block A re a

74

Zone 4

0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000

1 2 3 4 5

Block

A

r

e

a _Valuezone

ZNT Map

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