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Functional Obsolescence

Discussion in 'Urgent - Help Needed' started by zhencai, Sep 17, 2011.

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  1. zhencai

    zhencai Sophomore Member

    0
    May 27, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    A 2-story contemp house on a flat lot. Living room and dining room are on the first floor; Kitchen and family room (next to each other) are on the second floor. This appears to be a functional obsolescence issue. How to make adjustment? I know the area well but I've never seen one like this. There is no similar property in the area, even if I expand my search...

    Thanks for the advice.
     
  2. AnonApprsr

    AnonApprsr Elite Member

    0
    Jan 21, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    Massachusetts
    Why is that necessarily functional obsolescence? What are you basing it on? You seem to be jumping ahead of yourself. First you should figure out if it is, in fact, functional obsolescence and then figure out the market reaction by contacting local market participants.
     
  3. Jason Barber

    Jason Barber Junior Member

    0
    Feb 16, 2006
    Professional Status:
    Certified Residential Appraiser
    State:
    Michigan
    First you need to determine if it's curable or not. If it can be cured to allow similar functional utility as other homes in the neighborhood (and your comparables), then that is your adjustment. Otherwise you are going to have to analyze the markets reaction to this non-traditional floor plan.
     
  4. zhencai

    zhencai Sophomore Member

    0
    May 27, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Thanks for the comment. I'm not sure if it's functional obsolescence. That's why I said it "appears" to be. However, I think it would be weird the carry dishes between kitchen and dining room on different floors. I don't know the market reaction. That was my question. There is no comps. How to determine market reaction? Thanks.
     
  5. PropertyEconomics

    PropertyEconomics Elite Member

    1
    Jun 19, 2007
    Professional Status:
    Certified General Appraiser
    State:
    New Mexico
    First you need to decide if its even obsolescence. Never mind whether its cureable or not. If you dont have sales to show an item is functionally obsolete then I would caution you against using the term and making an adjustment.
    Obsolescence in all forms must be shown by market evidence ... lacking that its just your "feeling" that obsolescence may exist.

    If your feelings are strong, then handle it in the reconciliation as a means of concluding at the lower end of the provided range but do not make an adjustment you cannot support with market evidence.
     
  6. Obsolescent

    Obsolescent Senior Member

    20
    Jul 6, 2004
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    Any prior sales? If so, what was the listing history on its last sale? Was the marketing time similar to other properties within it's market or longer? Check with the Realtor at that time and ask if there was an adverse reaction to its floor plan.
     
  7. Terrel L. Shields

    Terrel L. Shields Elite Member
    Gold Supporting Member

    623
    May 2, 2002
    Professional Status:
    Certified General Appraiser
    State:
    Arkansas
    I like your thinking....go back and see if it sold "below" other similar homes in its history...
     
  8. BRCJR

    BRCJR Senior Member

    22
    Sep 20, 2005
    Professional Status:
    Licensed Appraiser
    State:
    Virginia
    Does the space that is called family room and the space that is called dining room have the ability to be "switched"?

    What stops the family room from being a dining room and what stops the dining room from being a family room?

    Sounds like someone wanted to put the tv and couch near the frig.

    Are you sure there is a functional issue? or preference of homeowner issue?
     
    Last edited: Sep 18, 2011
  9. Walter Kirk

    Walter Kirk Senior Member

    17
    Jun 24, 2003
    Professional Status:
    Licensed Appraiser
    State:
    New Jersey
    Where are the bedrooms and bath? how is food transported from the kitchen to the dining room? Is this a resort property?
    There are lots of houses on the Jersey shore that have the public rooms on the upper floor, these "upside down" houses are designed that way to take advantage of views and cool breezes.
     
  10. zhencai

    zhencai Sophomore Member

    0
    May 27, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
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