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  #1  
Old 10-12-2011, 04:01 PM
Scuba Mike's Avatar
Scuba Mike Scuba Mike is offline
 
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Default Unusual Property-Please Help!

I have a property in which they have added on to the original structure. Here's the problem. The carport has been enclosed and converted to a family room with a wood burning fireplace, they have added a 21x18 addition to the basement level of the home with another fireplace. In the original basement, they have a full kitchen. They have also added a detached garage equipped with electricity. All of these improvements were added over 25 years ago. There are no permits for the work done. They are not grandfathered in. Here in Georgia, more often then not, the lenders request permits for all work done over the original structure.

1st-Do I sketch all unpermitted improvements as GBA and give them zero weight and explain in an addendum?
2nd-Do I make note of the basement kitchen and also give it no weight?
3rd-The enclosed/converted carport has been made to where you cannot tell where the addition started or ended. There are no other records to verify this. Do you include this if you cannot verify where the original structure started/ended?

A year ago, no lender or anyone would ask or question the improvements as long as they were done in a workman like manner. Now they always ask.

I would probably go the way of providing the information, but giving it no value, however the carport offers a different problem. Any help would be greatly appreciated.
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  #2  
Old 10-12-2011, 04:09 PM
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J Grant J Grant is offline
 
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I would call your lender client and ask if they have any guidelines in place on permits etc.
  #3  
Old 10-12-2011, 04:19 PM
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Jo Ann Meyer Stratton Jo Ann Meyer Stratton is offline
 
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Verify with the local applicable governing agency if there has been permits issued and do they care or not. They are the authority of whether the additional areas are "legal" or not. For additions to have been there for 25 years, that might have been before permits were required or enforced and now because of the age they don't care. In your sketch each area should be delineated and identified. You as an appraiser do not or do give value to any thing. You research the market and discover what the market's reaction to that additional area is--it might be similar to the original area, a discounted price or a very sought after feature. Research the local market data, you might have to go back in time and a little further away than usual. What substitutes would a potential buyer consider before deciding on this specific property?
  #4  
Old 10-12-2011, 04:23 PM
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Scuba Mike Scuba Mike is offline
 
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I did. They're not sure what they want to do. I just want as many bases covered as I can.
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  #5  
Old 10-12-2011, 04:25 PM
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Scuba Mike Scuba Mike is offline
 
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Planning and zoning have no records of improvements at all. The tax assessor has the records showing the improvements, but no permits allowing for them. Neither one really knows anything.
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  #6  
Old 10-12-2011, 04:32 PM
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Michigan CG Michigan CG is offline
 
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Quote:
Originally Posted by Scuba Mike View Post
Planning and zoning have no records of improvements at all. The tax assessor has the records showing the improvements, but no permits allowing for them. Neither one really knows anything.
Finding permits from 25 years ago might be hard as not much was on a computer.

The assessor knows about the improvements and is most likely taxing them which would be tacit approval of the improvements. Should someone all of a sudden say they are not legal would the assessor refund all the taxes collected for the last 25 years?

I would use the Extraordinary Assumption that they are legal.
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  #7  
Old 10-12-2011, 04:32 PM
NorthTexValuation NorthTexValuation is offline
 
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I would not waste another minute with this POC assignment because you cannot get the answers you need regarding permits and legality of additions and such.

This could easily come back to bite you because its this type of proeprty that goes into default more often than a normal house. Ask your client to assign it to an appraiser who is specializes in this type of property.
  #8  
Old 10-12-2011, 04:49 PM
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Couch Potato Couch Potato is offline
 
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Quote:
Originally Posted by Scuba Mike View Post
I have a property in which they have added on to the original structure. Here's the problem. The carport has been enclosed and converted to a family room with a wood burning fireplace, they have added a 21x18 addition to the basement level of the home with another fireplace. In the original basement, they have a full kitchen. They have also added a detached garage equipped with electricity. All of these improvements were added over 25 years ago. There are no permits for the work done. They are not grandfathered in. Here in Georgia, more often then not, the lenders request permits for all work done over the original structure.

1st-Do I sketch all unpermitted improvements as GBA and give them zero weight and explain in an addendum?
2nd-Do I make note of the basement kitchen and also give it no weight?
3rd-The enclosed/converted carport has been made to where you cannot tell where the addition started or ended. There are no other records to verify this. Do you include this if you cannot verify where the original structure started/ended?

A year ago, no lender or anyone would ask or question the improvements as long as they were done in a workman like manner. Now they always ask.

I would probably go the way of providing the information, but giving it no value, however the carport offers a different problem. Any help would be greatly appreciated.
When say there are no permits do you mean you do not have evidence of permits or do you me you have evidence no permits ever existed?

Your only choice in producing an "AsIs" appraisal is to give the market value for the property as it currently exists. There are other things you can offer your client, but that is a conversation you can only have with them. Not much we can do for you here.
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  #9  
Old 10-12-2011, 04:58 PM
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J Grant J Grant is offline
 
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That is why you need to discuss with your client. The market may show an adjustment and value for non permitted additions/conversions to living space, but your lender client may have a policy where they won't lend on such homes, or will only lend on the home that was the original dwelling.
  #10  
Old 10-12-2011, 04:59 PM
Mountain Man Mountain Man is offline
 
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A lot of GA counties, except for metro counties, didn't have a building department until the 1990's or 2000's. Some, like Rabun, still don't have a building inspector... get a permit and build it how ever you want. So depending on which county, your problem may be solved by going to the office and buying a back date permit. Check with the county offices before you go off the handle worrying about what may be a non-issue.
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