Property valuation in peri-urban land acquisition for cooperative housing development in Woldia, Ethiopia

Abstract

Property valuation for compensation is the foundation for developing urban projects, including cooperative housing initiatives. This study examined property valuation practices for compensation in peri-urban land acquisition for cooperative housing development in Woldia town, Ethiopia. Data were collected from 323 survey households, 12 key informant interviews, and six focus group discussions. The data were analyzed using descriptive statistics, Fisher's Exact Test, and binary logistic regression, while qualitative data were examined through thematic analysis. The results indicated that the compensation amount for land acquisition for cooperative housing development is lower than the benefits derived from the acquired land. The estimation methods employed do not align with the established replacement cost method. The result revealed that property valuators considered only the value of crop production and byproducts, neglecting improvements made on the land and both ripe and unripe perennial fruits. The findings showed that compensation for crop production has significantly increased from 2019 to 2024, reaching $79.05. In contrast, compensation for by-products has remained stable at $3.26 per sack, which does not reflect current market pricing principles. The binary logistic regression result revealed that factors such as age, acceptance of the plan, timing of dispossession, and pre-dispossession income significantly influenced the willingness of affected individuals to accept the determined compensation, with a significance level of p < 0.001. Gender, year of land acquisition, crop production, Tropical Livestock Units (TLUs), distance from the market center were also significant at p < 0.05. Suggestions for improving property valuation and compensation procedures were provided.