THE VALUATION OF WOODS OR PLANTATIONS. 401 



particular circumstances of each estate. Such modifications must 

 be left to the judgment and experience of the valuer. 



2. Middle-aged Woods. 



This is a class of woods in which the valuer will experience 

 some difficulty when estimating the transferable value. The trees 

 have not reached maturity, and the valuation must be based on 

 the pi^ospective value of the trees. The method adopted is usually 

 on the following lines, modified, of course, to adapt it to the 

 peculiar circumstances of each case : — (1) Estimate the number 

 of years the wood will take to reach maturity, and the ultimate 

 value of all the trees likely to be found in the final crop. 

 (2) Estimate the value of all thinnings likely to be taken from 

 the wood before the trees reach maturity. (3) To obtain the 

 present transferable value from the sum of these two (viz., the 

 value of the trees at maturity and of the intermediate thinnings 

 to be taken), deduct compound interest at say 7i per cent., to 

 cover interest on capital outlay, taxes, supervision, etc., for the 

 number of years the trees take to reach maturity. 



If to the amount thus obtained be added the capitalised rents of 

 the ground on which the timber stands, a fair valuation will have 

 been arrived at of the present value of the plantation. But here 

 a point must be noted in regard to the capitalising of the rents 

 of the land. In the prospective value, the purchaser has already 

 paid for the annual increment (growth) up to the period of 

 maturity of the timber ; and the interest which he is entitled 

 to receive on the capital sum paid down for the land will be 

 deferred until the period of maturity. This is a case of calcu- 

 lating the present value of the reversion of say £1 per acre 

 (which we will assume the land is worth as agricultural or 

 grazing land) deferred twenty years, when the wood will reach 

 maturity. This can easily be found from tables prepared for the 

 valuation and purchasing of estates, and which every valuer 

 should possess. Thus at 4 per cent.— a fair interest on money 

 invested — the present value at twenty- five years' purchase of a 

 perpetuity twenty years deferred is only 11-409 years' purchase. 

 The estimated yeai'ly rental should therefore only be multiplied 

 by 11*409, and the amount added to the value of the growing 

 timber, to find the transferable value. The considerations men- 

 tioned in the case of matured woods as to the valuing of the land 

 on which the crop stands apply to this class of crops also, and the 



