The Importance of a Forest Inventory Report

The Importance of knowing the value of your land The value of timber can make all the difference when buying or selling land. This fact seems to be overlooked by most real estate agents and landowners. A forest inventory report can also help get the desired loan from a bank. Perhaps you already own land and want to have the highest cost basis to pay the least in capital gains tax. A forest inventory report will allow you to do that. Understanding this might give you an edge over other buyers or sellers. With all that said, what is a forest inventor report?

A forest inventory report is a systematic sampling process where a professional forester gathers data from a stand of timber to accurately project the value of the whole stand. The sampling points are set out by a uniform grid. This will eliminate the possibility of bias. The forester will travel to each point using a GPS. At the point, the forester will measure and tally the trees within the specified area. This process is repeated at each point until a desirable confidence interval is made. This might sound all fine and dandy, but how accurate is it?

The volume estimates contained in an appraisal are obtained using sound forestry principles.  However, even though we have great confidence in the estimates, they are only a sample of the total tree population and can not be guaranteed. Stating that there is no guarantee is a part of any sampling process. In most cases, the volume estimates fall under a 90% confidence interval. Thus, the estimates vary +/- 10%.

To give an example, we cruised a recreational property in Butler County, Kentucky. After we cruised the tract, the timber alone added another $100,000.00 to the standing value of the land. In short, a trained professional can assist in the big decision of buying or selling land.

Eli Moore, Consultant Forester

November 17th, 2023