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Old 04-08-2005, 06:58 PM
alpineinc alpineinc is offline
Join Date: Jun 2002
Location: Northeast
State: New Jersey
Professional Status: Certified Residential Appraiser
Posts: 31

Okay, here's a good one. We have at first glance what appears to be two single family half-duplex properties attached to each other (making one duplex type dwelling), each on a 20x100 lot. Easy, right? Problem is, it has been sold as a multi-family property more than once, so we have various recent deeds as a MF, and lender has TWO previous recent appraisals as a MF. Current owner has her one deed, pays 2 tax bills. Also, the duplex layout inside (both sides occupied by same owner) is not split along the property line (basement is finished and completely open to entire structure with full access to both sides, and above grade, each side has a half-bath (one behind the other) that straddles and extends over this line, but there is no access between the two units above grade.

- Legally - 2SF, since 2 lots (?), but both uses are allowed (town told me " they can do whatever they want to do" - trying to find someone a little more enlightened!)
- Physically possible - lot wise 2SF, improvement wise MF
- Financially feasible - again MF, additional cost to change to 2 SF layout?
- Most value - MF

Virtually all properties on street are identical to this, but are on one lot and are all MFs. This appears to be the only one with two parcels under the single structure, but the street history leads me to believe it had to be a true MF at least at one time.

Still waiting for definitive word from the city, but it seems that it would have to be 2 SFs with obsolescence, etc. for non-separated basement and encroaching baths, but HABU is a problem. What do you guys think?
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Old 04-09-2005, 10:47 AM
Wally Jones's Avatar
Wally Jones Wally Jones is offline
Join Date: Jan 2002
Location: Lakeland, Florida USA
State: Florida
Professional Status: Certified Residential Appraiser
Posts: 1,722

If the legal descriptions say there are two separate properties then you have two attached single family residences. If this is the case, you may need to look beyond that particular neighborhood for similar comparables. (Are there any current listings/pending sales being marketed as single family homes that are similar to your subject?) The highest and best use may still be as a duplex but that can take a detailed analysis to figure out sometimes. The income stream from rental properties is sometimes offset and exceeded by the cost of maintenance.

We see many of these in our market. Duplexes which have been converted to attached single family use. The other wrench in the works is if the "new" single family units are being rented, the client may sometimes decline the loan (some don't want to handle income property) or want a sinlge family rental analysis.

Confirm that there are two distinct legal descriptions for each "side" of the building/lot. Talk to your client to see how they want you to proceed.

It is what it is.

Good luck.
Old 04-10-2005, 06:17 PM
Walter Kirk Walter Kirk is offline
Join Date: Jun 2003
Location: Audubon, N.J.
State: New Jersey
Professional Status: Licensed Appraiser
Posts: 4,418

I own a house just like the one that you describe. If you have two parcels you have two propertieseven thgough they were conveyed on one deed. Although other appraisers have treated it as a two family they were wrong, don't repeat their mistake.
Old 04-10-2005, 10:49 PM
Couch Potato's Avatar
Couch Potato Couch Potato is offline
Join Date: Mar 2004
Location: Chapel Hill
State: North Carolina
Professional Status: Certified Residential Appraiser
Posts: 14,075

Depending on local laws it may be as simple as a letter requesting the merging of the properties into one tax ID to make it officially MF.
"Give a man a gun and he can rob a bank. Give a man a bank and he can rob the world."
Old 04-11-2005, 09:30 AM
Jo Ann Meyer Stratton's Avatar
Jo Ann Meyer Stratton Jo Ann Meyer Stratton is offline
Join Date: Jan 2002
Location: Safford, Arizona
State: Arizona
Professional Status: Certified Residential Appraiser
Posts: 6,322

Assessor's parcel numbers do not determine the number of properties, they are a bookkeeping function for assessment purposes.

A single property can consist of numerous lot numbers or several different legal descriptions. Legal descriptions on a Deed of Trust can be a single description or multiple descriptions. Due to city limit or school district or fire district or irrigation district or special assessment district, etc, etc lines parcels sometimes cannot be combined into a single assessment. That does not effect the legal description that is on the deeds transferring or encumbering the property. Therefore there can be very bona-fide reasons that there will be several assessor's parcel numbers.

So what is the highest and best use of the property? What is most physical determining factors that indicate whether it is a single or multiple entity? etc, etc.

Once you and the client has made that decision, then you can appraise it to its highest and best use. That might involve one structure and one legal, or one structure and 2 or more legal, or two more structures and one legal, or two more structures and two or more legal.

You appraise the property to the highest and best use, the lender has the title company write the legal description and issue title insurance for what ever legal description is necessary to cover the ground that highest and best use necessitates.
Jo Ann Meyer Stratton, IFA, SRA
Old 04-11-2005, 11:42 PM
alpineinc alpineinc is offline
Join Date: Jun 2002
Location: Northeast
State: New Jersey
Professional Status: Certified Residential Appraiser
Posts: 31

Thanks to all replies, they are very helpful and much appreciated. Never did get definitive word from the town, but there are clearly two lots with the owner paying two tax bills, and since the entire street is similar to subject, but with larger lots and single MF structures, it appears the parcel was split in two for some reason in the recent past. And the HABU was really in the middle, so it's one of the tougher ones I've done. Anyway, the client has cancelled the order due to the discrepancies, but I can definitely put this one in the learning experience column. So, thanks again.
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