Condo/Townhomes

[Don Clark]

Wrong, Wrong, Wrong! Since when do condominimums not own the land??????
Of course they own the land( except in some instances when a long term land lease is in effect i.e. indian tribal lands in Palm Springs)!!!!! All unit owners own the land collectivly and thus have an "indivisable interest" in the land and common elements.
C'mon guys we are supposed to be professionals here and if you do not know what you are doing then you should never have accepted the assingment!!!!!

I have appraised commercial office suites that are condominium ownership, 4 plexes that are condominium ownership, townhouses that are condominium ownership, 4 story queen ann's with each story that are condominium ownership, 5 story brownstones row houses with each story that are condominium ownership.
Condominimum is a legal way to hold title to real estate and has nothing whatsoever to do with the style of building.
Please do not confuse this form of ownership with Co-op's as that too is a different animal all together.

Have to agree with Frederick to a great extent. Also, ownership of only the air rights do not apply in many cases, and usually only in high rise condos. I have attached a single family detached home on it's own tract of land but is a condo; a 2 unit(only 2 units in the entire condo); and a townhouse style condo. We also have HUD Code double wides in a condo park where each double wide is a condo unit:

 

[TC]

Welcome to the Forum, don't let these guys run you off.

One of my pet peeves is this question, maybe it's just too easy to identify a condo vs a PUD in my market, cuz I never have a problem. I will say that do some leg work, knock on some doors, find the HO president, the on-site manager, talk to the agent, contact a fellow appraiser.

You just need to search for the information. I'm currently doing an attached Townhouse that the agent swears is a condo and stated such on the listing sheet. A trip to the courthouse and some info from a fellow appraiser shows it's clearly a PUD. But within the plan are 12 condos and 14 detached single family houses. Confusing, but that's our job. I emailed the plot plan to the agent so she could "correct" her listing. Yeah, that will happen.

TC

 

[Frederick R. Ruffell]

"C'mon guys we are supposed to be professionals here and if you do not know what you are doing then you should never have accepted the assingment!!!!!"

Fred, I don't appreciate you stating I do not know what I am doing. It seems like a personal attack to me. Anyway, so they own the land, and the structure correct? If that is the case why can't they make any changes to the structure, the common areas or the building? Why can't they tear down their unit in the condo development and build a townhome? They own it correct? I said I simplified the meaning, when I wrote the statement I knew it wasn't the technical answer. It was a simplification to help the Loan officer and Real estate agent understand that there is a Big difference between townhome and condominiums ownership. Also, it is very common in our tax records for condo's to have 0 for the lot size, because they do not have full ownership of the lot that they rest on. QUOTE]


Sorry you feel that way "but if the shoe fits", key word there and in my post is "if". Maybe you need ro re-read the post? Furthermore what you said you told your client was factually wrong. Stop doing that, maybe that is why they can't understand the concept in the first place because people like you are Misleading them with incorrect information. Stop doing that! And why are you talking to anyone but your client? Why are you talking to brokers and borrowers and owners?

 

[Frederick R. Ruffell]

Fred, I don't appreciate you stating I do not know what I am doing. It seems like a personal attack to me. Anyway, so they own the land, and the structure correct? If that is the case why can't they make any changes to the structure, the common areas or the building? Why can't they tear down their unit in the condo development and build a townhome? They own it correct?
.

Of course they can make changes to the structure, common areas and the buildings. I have seen it done all the time. The same way a home owner of a SFR has to go to a regulatory agency (i.e. get a building permit) to perform changes to their structure so do the owners that hold their property by condominimum. They just have the extra step of gettin it approved by their HOA.

Where are you getting this from. Maybe it is different in your state?

 

[Bill_FL]

As I have posted on this forum for at least 1,100 times, a CONDO is a form of ownership not a style of archetecture. A Townhouse is a style of property as are detached homes, and at least 200+ variations of housing in the USA. You have to look at the documents in the public record. If the documents describe a condo, then it is a condo even if it looks like a townhouse. In my market we have old 1950's style motels that have been converted to condo's, apartments converted to condo's, duplex, triplex, and 4 units converted to condo's. We also have condo's where the entire condo is just 2 units, no fees, no HOA. We also have single family detached sitting on their own tract of land that are condo's. Again, a CONDO is a form of ownership, not a style of archetecture. Search the records. If the records describe a condo, then it is a condo. I realize there is no zoning in Houston. This is not a matter of zoning but of ownership. The idea that a condo has to be a unit in a high rise with ownership of air space only is archaic, outmoded, and not the reality of the times. In any document, a condo would be described as a "unit" and not by lot & block. I realize you may have not seen the many post about condo's so don't take this personal. Half the forum is probably still confused about what a condo actually is, but so is the secondary market, most lenders, and most appraisal dictionaries and referrence books.

Don - while we agree on this. We are not always 100% correct. You see, in some states, the Legislatures have actually defined these terms into law. Now, some stated define in law a townhouse to be an attach unit that owns land.

 

[Don Clark]

Don - while we agree on this. We are not always 100% correct. You see, in some states, the Legislatures have actually defined these terms into law. Now, some stated define in law a townhouse to be an attach unit that owns land.

Bill,

I understand that. The states can really screw things up now and then. But, I believe, in all states a Condo is described as a unit in a condominium development, with an undivided interest in certain common areas. Even here in virginia where we have 2 unit condo's(the entire condo is just 2 units) our records describe an undivided interest in the common elements. those generally include, in such a small condo development, access to the units such as driveways, etc. And, often, even in larger condo developments there are no condo fees as each unit owner is responsible for maintaining their entire unit including interior, exterior, and the portion of the site it sits on. Below is a HUD Code Manufactured Home. It sits on it's own site that is owned and maintained by the unit owner. The condo fees pay forr common area maintenance which in this case is just the streets.

 

[Vermonter]

Mike.....Look at the tax records. If the assessor's parcel number assigned to the unit you are appraising has a tax assessment for the land plus a tax assessment for the improvements, it is not a condo.

You can't always go by this. Virginia tax records on condos had assessments for land. Don't ask me why.

 

[Don Clark]

You can't always go by this. Virginia tax records on condos had assessments for land. Don't ask me why.

Robert, you are absolutely right. The reason is so they can stick it to us 2 seperate ways for assessments.

 

[Mikew]

Ok, apparently I wasn't as clear as I should have been

The unit is under 3 floors of other condo units. It is the only unit out of +/- 6 buildings that is on the garage level. My definition only applied to this specific condo unit or similar units, as I am fairly certain while they may have a few other ownership rights, they DO NOT have the right to make any changes other then cosmetic, without having some serious issues. I am not an expert on ownership rights, nor do I pretend to be, but if they start trying to mess around with the structure of the building they are going to have a few issues, IMO. I honestly didn't think this was pertinent, but apparently proving my own knowledge/experience is a requirement beforehand.

Anyway, as far as discussing anything with a borrower? Where did I ever say that? I was talking with the LO and the listing agent, simply as a matter of damage control. I consider it good customer service, and also an assitance in understanding the problem presented. If an untrained eye looked at the comps, without double checking the information the appraisal could have been cranked out in a couple of hours. However, this is what brings me here. To get other opinions on the subject. Heh, and I did get them !

With that said:
Thanks for the input, information, and for the mostly warm welcome. I think the best answer thus far, was the one I came to as well.

From TC.
I will say that do some leg work, knock on some doors, find the HO president, the on-site manager, talk to the agent, contact a fellow appraiser.

As there unfortunately is no easy answer judging by the variety of opinions. Due diligence...

 

[Frederick R. Ruffell]

Mikew,

Hey look maybe we got off on the wrong foot but you asked, actually I looked at your inital post again and am not really able to discern an actual question. And as such maybe it is appropriate that it is in the General forum.

My position is still the same and I will try to restate it here in an attempt to address your posting.

You, as the appriaser, are the one to make the determinitation as to how the property is classified. You as the appraiser are supposed to be competent (i.e.possess all the necessary education, skills, and knowhow) to complete the assignment OR you are duty bound to not accept the assignment OR disclose you lack of competency and list in your report the steps you took to become competent.

Sooooo from what you posted subsequently, it appeared that you were under the impression that condiminum ownership had no land component to it. Also that the owners could not make any changes to their property. Both of these things are not true in my area. I have never appraised in Texas and maybe things are different there, if so I am sorry for thinking otherwise.