Making sense of land values

Do you ever think about what your home is worth? reads a sign outside a real estate office in northern Copenhagen, where I live. It continues: Join us for our Valuation Weekend and get a free, thorough and non-binding sales valuation from an agent who is not so realtor like.

As someone who is both affected by, and candidly part of, gentrification in Copenhagen’s heated housing market, I find this message revealing in three major ways. First, it is clearly addressed only to those privileged enough to own property in Copenhagen, a dream that has become increasingly out of reach for many in my generation.

Second, it mobilises the hope that one’s home has increased in value over time. This curiosity, closer to the mindset of an investor than that of the traditional homeowner, reflects a broader cultural and economic shift. Ordinary homeowners increasingly treat their homes as financial assets, an investment to climb the property ladder with or to rely on as a form of private pension.

Third, and most importantly for its intended audience, the message promises a free and seemingly neutral assessment delivered by a trustworthy professional who presents himself as the opposite of the familiar stereotype of the pushy, sales-oriented estate agent more interested in closing a deal than in providing an honest appraisal.

This advertisement reflects a broader hype around property valuations. Homeowners are routinely targeted with offers of free and instant appraisals via agents’ websites and online platforms such as Boligportalen in Denmark, Zoopla in the UK, or ImmoScout24 in Germany. These platforms, of course, depend financially on properties being put on the market. Valuations thus become a tempting measure of economic potential that goes beyond the asking prices of supposedly comparable homes displayed online. Property valuations, however, are much more than a marketing tool.

Land, the awkward commodity

Although property typically refers to a composite of land and improvements, it is the value of land itself that carries not only the greatest economic weight but also significant political and moral importance. Buildings depreciate and can be replaced, but land is fixed, scarce and embedded in planning decisions, infrastructure investments and ecological systems. The land component of property value most clearly reflects these wider moral and political entanglements in society.

Karl Polanyi, writing in the mid twentieth century, made this point clearly. He argued that land was not a true commodity but a basic condition of human life. Treating it as if it were a manufactured good was, in his view, a liberal fiction that risked destabilising society by subjecting something fundamental to market logic. The global and historical persistence of resistance to land commodification and financialisation, from land grabs to protests over affordability and tenant rights, bears witness to this enduring tension.

However, what Polanyi did not fully explain was how this fiction of land is made workable in practice. As Tania Murray Li reminds us, land is not a self-evident object waiting to be exchanged, but must be constituted as something that can be owned, bounded and valued.

Making land valuable

Making land valuable involves practices of measuring, comparing and assessing land. Only through surveying boundaries can property titles be established and registered. This work, carried out by certified surveyors and valuers, underpins key instruments of land policy, including taxation and compensation in cases of expropriation or foreclosure. Valuations can be technically complex and require specialist expertise, for example when assessing a unique historic building. Valuing land, however, is not merely a technical exercise. There is no universal formula for determining its value. Instead, valuation is organised within distinct institutional traditions that reflect the complex histories of land and normative ideas about how land markets ought to function and whom they should serve:

In Germany, property is understood to carry social obligations, requiring the state to secure the institutional framework needed to curb speculation and ensure market transparency. This orientation is expressed in a publicly codified valuation regime. Under the Federal Building Code and the Property Valuation Ordinance, independent expert committees collect transaction data and publish standard reference land values derived from recorded sales. These zone-based reference values rest on the premise that an objective market value can be identified through systematic data collection and methodological standardisation. Valuation is thus framed as a publicly organised process designed to stabilise and render markets transparent.

In England, by contrast, valuation developed primarily within professional organisations linked to landowning and commercial interests rather than public institutions. This trajectory fostered the view that markets require ongoing interpretation from within rather than direction by the state. Professional standards are set within largely self-regulating institutions and networks that rely on practitioner judgement and close engagement with the industry. Here, value is understood to emerge through expert interpretation embedded in market practice rather than through publicly codified rules.

Despite these institutional differences, both systems ultimately centre valuation on market value, reinforcing land’s treatment as an economic object. Land’s wider moral entanglements in society are addressed only insofar as they are channelled through expertise, procedural fairness and market transparency, and incorporated into what counts as acceptable or just market outcomes.

Reimagining valuation therefore does not mean abandoning valuation altogether, but making its underlying assumptions explicit and broadening the frameworks through which land is assessed. This includes taking more seriously the social, technological and ecological entanglements that shape land’s value, and recognising that how we value land shapes how we govern it.

Reclaiming land values

In the context of today’s land and housing pressures, reimagining land and property valuation takes on renewed significance. For example, if land values rise not only because of individual ownership and improvements, but also as a result of collective investments in infrastructure, planning decisions and public services, then a basic question follows: how should the resulting gains be distributed? And what other values, including social, ecological and political ones, should be taken into account?

Returning to Copenhagen, where housing prices and land values have risen markedly over recent decades, these questions have become increasingly salient. Rising property values have generated significant increases in housing wealth for many homeowners. At the same time, these increases are closely connected to broader patterns of urban development, fiscal policies, public infrastructure and planning decisions. Public debate has therefore centred not only on technical assessment methods, but also on how collectively shaped increases in land value should be treated.

The Danish case illustrates both the possibilities and the tensions associated with progressive land politics more closely. Copenhagen in particular maintains a relatively high proportion of non-profit and cooperative housing, reflecting a longstanding emphasis on collective provision. At the same time, land is governed not only through planning and housing policy, but also through an institutionalised regime of public valuation supported by comprehensive public registers, accessible transaction data and detailed property information.

This comparatively high degree of transparency underpins the land tax, the so called grundskyld, levied by municipalities on the unimproved value of land. Inspired by the social liberal land reformer Henry George, the tax was introduced in the mid-1920s and remains a central instrument within Danish land and fiscal policy. Unlike George’s more radical proposal to replace all duties with a single tax on land, however, the grundskyld forms only one component of the broader property tax system and does not fully socialise land rents. Today, the Danish Property Assessment Agency (Vurderingsstyrelsen), operating under the national tax authority, produces the valuations used to calculate annual municipal land taxes.

Recent reforms to the valuation system, including the introduction of a fully centralised and largely automated assessment model, have generated sustained public and media controversy. Concerns have focused on rising tax liabilities, particularly among homeowners in the Copenhagen region who have benefited disproportionately from increasing land values. At the same time, questions have been raised about whether the new automated system delivers the transparency and consistency it promised. Implementation delays and acknowledged shortcomings in earlier assessment rounds have intensified scrutiny. Many homeowners report receiving valuations they regard as difficult to understand or inaccurate, perceptions shaped and amplified by extensive media coverage. Together, these developments have prompted broader debates about accountability and public trust, both in individual assessments and in the tax itself.

One lesson from this episode is that institutional design matters. Even in contexts characterised by relatively strong public institutions, land value taxation and transparent data infrastructures, disagreements persist over what land values represent and who should benefit from them. This illustrates that the legitimacy of land value redistribution rests not only on institutional arrangements but also on shared moral beliefs about fairness and on levels of public trust. At the centre of these disagreements lies a fundamental normative question: whether land value gains should be understood as unearned income arising from collective investment, planning decisions and broader social processes, or as legitimate returns to private ownership.

Moreover, the growing risks associated with climate change, including increased flooding in low lying coastal areas, threaten to unsettle established patterns of valuation. In such contexts, land values become contingent on emerging forms of environmental risk, raising difficult questions about insurance, compensation and the allocation of public responsibility.

Taken together, these dynamics indicate that progressive land politics cannot be confined to market regulation alone. Confronting contemporary land and housing crises may therefore require not only regulatory reform but also a shift in the imaginaries that underpin how land itself is valued. This involves recognising the collective production of land value, incorporating environmental and social considerations into existing frameworks and expanding public and collective forms of ownership and access that are not governed solely by market imperatives.

Dr Alexander Dobeson is an Assistant Professor at Copenhagen Business School. His research examines the social, technical and cultural dimensions of property, including the privatisation of access rights, land markets, land reform, cooperative forms of ownership and economic democracy.