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Old 10-12-2010, 12:16 AM
mp2277 mp2277 is offline
 
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Default multi family ?

5000 sf house built in early 1900's with a carriage house apartment in the back yard. The main house has been turned into 4 units, 2 above grade, 2 below. Is this a 5 unit, or a 4 unit with an accessory unit. I have nothing to do with this assignment, just overheard a conversation between two appraisers and a Realtor. Ironically, both appraisers made good arguments. My first opinion ws that it was a 5 unit, however, listening, I am tempted to think it is a 4 w/ accessory unit. Of course I know why it makes a difference, neither of them were CG's, but am curious as to other opinions.
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Old 10-12-2010, 06:15 AM
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zdfenton zdfenton is offline
 
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It really comes down to highest and best use, is it legally permissible and does it have the potential to draw a rent

On a side note I do know for a fact Fannie has been forcing lenders to buy back loans based on appraisers (and lenders) ignoring 5th units (accessory units, basement units, etc)
  #3  
Old 10-12-2010, 11:58 AM
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CANative CANative is online now
 
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Funky 5-unit residential income property. IMO and without knowing anything else about the property.

You can't have multiple units and an accessory unit for GSE purposes in any case.
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Old 10-12-2010, 02:00 PM
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David Wimpelberg David Wimpelberg is offline
 
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Quote:
Originally Posted by mp2277 View Post
5000 sf house built in early 1900's with a carriage house apartment in the back yard. The main house has been turned into 4 units, 2 above grade, 2 below. Is this a 5 unit, or a 4 unit with an accessory unit. I have nothing to do with this assignment, just overheard a conversation between two appraisers and a Realtor. Ironically, both appraisers made good arguments. My first opinion ws that it was a 5 unit, however, listening, I am tempted to think it is a 4 w/ accessory unit. Of course I know why it makes a difference, neither of them were CG's, but am curious as to other opinions.
My answer is based on the assumption that all units are legal.

Call the units what you want, but

4 units + 1 accessory unit = 5 units.
  #5  
Old 10-12-2010, 03:24 PM
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Mike Kennedy Mike Kennedy is offline
 
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Quote:
Originally Posted by mp2277 View Post
5000 sf house built in early 1900's with a carriage house apartment in the back yard. The main house has been turned into 4 units, 2 above grade, 2 below. Is this a 5 unit, or a 4 unit with an accessory unit. I have nothing to do with this assignment, just overheard a conversation between two appraisers and a Realtor. Ironically, both appraisers made good arguments. My first opinion ws that it was a 5 unit, however, listening, I am tempted to think it is a 4 w/ accessory unit. Of course I know why it makes a difference, neither of them were CG's, but am curious as to other opinions.
The Answer s/be predicated on Due Diligence confirming:

1. local municipal zoning AND building ordinances in effect?
2. C. of O./Compliance for "turned into" conversion from SFR required and obtained?
3. was a C. of O. for finishing the basement in a Vintage 100+ year old home required i.e. finished bsmt only, then .......C. of O. for two basement apartments
4. WHEN were the conversions done i.e. PRE-zoning & building ordinances or POST?
5. Once Legally Permissible Use(s) (as of the Effective Date of Appraisal) has/have been established, look to the Market to demonstrate which Use clearly is HABU.
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Old 10-12-2010, 03:38 PM
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5 unit in my area, with perhaps greater rent on the detached unit. Of course, if it's recognized by the town as legal, that'd be swell.
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Old 10-12-2010, 03:57 PM
leelansford leelansford is offline
 
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I always get a kick from discussions as to whether or not a particular property is "this" or "that" with no discussion as to what might be legally permissable or whether or not there is zoning applicable to the property under discussion.
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Old 10-12-2010, 04:03 PM
mp2277 mp2277 is offline
 
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To clarify, it is legal, zoned properly, CO's from city for all 5 units, should have stated that up front I guess. HABU is as it is and this type of housing is common in that area of town. Grandfathered as multi family. TY
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Old 10-12-2010, 04:05 PM
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The 4 unit plus accessory unit is a lender trick. Don't fall for it.
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  #10  
Old 10-12-2010, 06:27 PM
Denis DeSaix Denis DeSaix is offline
 
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Quote:
Originally Posted by CANative View Post
The 4 unit plus accessory unit is a lender trick. Don't fall for it.
Agreed.

If the four units are rental units, how is the 5th unit an accessory unit and not another rental unit?

Accessory reflects something supplemental or subordinate to the primary use.
An accessory unit can be supplemental or subordinate to the primary use of a single-family residence.
I don't see how a unit which is a rental (or would serve as such) can be supplemental or subordinate to a rental-income property with multiple units?
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