Which valuation method considers the cost of land and construction?

The cost approach is the correct answer as it directly assesses the value of a property based on the cost to replace or reproduce the structure on the land, including both the price of the land and the expenses related to construction. This method involves estimating the current cost to construct a new building that is similar in size, type, and utility to the subject property, then adding the value of the land on which the property is situated. Essentially, it calculates the total cost of the property as if it were to be built anew, making it particularly useful for properties that are unique or for which there are few comparables in the market.

In contrast, the sales comparison approach focuses on comparing the subject property to similar properties that have recently sold in the same area, without giving direct consideration to the costs of construction or land. The income approach values the property based on the income it generates, which is particularly relevant for investment properties but does not involve direct cost assessments. Lastly, comparative market analysis is a technique often used in real estate to determine a property's value based on the sale prices of similar properties, but it also does not specifically consider the direct costs of land and construction like the cost approach does.