Which principle indicates that the availability of land impacts its value?

The principle that indicates the availability of land impacts its value is scarcity. This principle asserts that land is a finite resource; as the amount of land decreases or becomes more limited in certain areas, its value tends to increase. Scarcity creates competition among potential buyers and investors, driving prices up for desirable locations.

Understanding scarcity is crucial in real estate, as it highlights how limited availability can lead to increased demand and higher property values, particularly in urban areas or regions experiencing growth. This principle also emphasizes the importance of location, as land in highly sought-after areas will generally hold more value due to its limited supply.

In contrast, liquidity refers to how quickly an asset can be converted into cash, while fixity relates to the permanence of land and its improvements. Air rights represent the legal ability to utilize the space above a property and are not directly related to the principle of scarcity affecting land’s value.