Do Balconies count for anything

[LI-Appr]

You may be overpricing your upgrades as you allow $10,000 for a water heater and appliances. If they actually cost that much they are probably a super adequacy in your market area.

 

[Mary B]

I was loose which is why I said 30,000+ The water heater was 1800, the refrigerator was $1900, the range was 1700, the dishwasher 700 and the dryer was around 700 and the microwave was 400. Mostly Sears. There are a ton of retired Air Force officers here - some colonels and some generals that are contractors. Many of them have nice upgraded appliances as well. There are Mercedes and BMW's in our parking lot. Some have upgraded 15,000 to 25,000 (including appliances) but none have redone their bath to the extent we did. Some have high end granite but most don't have refaced cabinets.

What does super adequacy mean? And - I still can't figure how a condo with no upgrades at all and 12 year old everything trumps a better, bigger, 30,000 or so upgraded condo. I re-ran the figures with my agent. Actually ours is 236 and theirs is 238 per sqaure feet. Isn't that odd? Can different appraisers really make that much of a difference? I still don't know if theirs was FHA.. Could THAT be the culprit? I still have to find that out.

 

[Michigan CG]

Superadequacy
An excess in the capacity or quality of a structure or structural component; determined by market standards.

Overimprovement
An improvement that does not represent the most profitable use for the site on which it is placed because it is too large or costly and cannot develop the highest possible land value; may be temporary or permanent. Can be considered a superadequacy and measured accordingly in estimating depreciation.

 

[Pamela Crowley (Florida)]

Maybe the other unit's appraiser came in too high and is the one that is wrong?

Why do you think the appraiser who's opinion of market value that is lower than those involved in the transaction is always the one that's considered wrong?

Maybe the other unit's loan will not close after that appraisal is reviewed?

 

[Mike Kennedy]

Mary B. - simple solution to your dilemma:

Assumptions: your condo is self-managed with an HOA, or utilizes a Management Company. Should that NOT be the case - a trip to the Local Assessor's Office to research closed sales in YOUR condo complex would be in your best interest.

In either case - recommend contacting the respective Mgmt Co. Property Manager, or HOA President, to obtain confirmed closed sale data on units which sold between 300-400 (if any) within the past 2 years. Compare your upgrades to the higher priced units to determine what the Market (buyers) actually paid as contributory value of the additional upgrades you cite (or equivalent upgrades) - IF any report same. Recommend 2007+ versus probable "market bubble high" 2004-2006. I suggest continuted Speculation will accomplish nothing.

Should the Appraiser have dug deeper? That can only be determined either by the Appraiser, the Lender, your RE Agent (if you are using one), OR you.

Should you (the RE Agent, or the Lender) isolate TRULY competitive, confirmed closed sales which demonstrate market reaction to quality and/or renovations ABOVE the current comparables utilized - communicate them to the LENDER and request a Reconsideration of Value.

Older sales beyond 1 year MAY, or may not, require NO Time Adjustment or NEGATIVE Time Adjustment reflecting market conditions variances between their Sale Date and Current Effective Date of Appraisal. Can closed sales OVER 12 months be utilized in addition to more current closed sales, contracted sales, and active listings - YES. Will they require upward, downward, or NO Time Adjustments - that remains to be determine once they are identified and confirmed - after considering all the other comparative elements.

Keep in mind - you may also encounter confirmed info that units with similar upgrades yielded NO additional contributory Values above the highest priced, confirmed, arms-length sales. If so that factor will indicate whether BUYERS actually pay for possibly atypical, above average, upgrades i.e. Functional Obsolescence-Superadequacy.

p.s. In your shoes, I assure you I would hire an Experienced, LOCAL, Ethical Appraiser to perform the Market Data Search for you - most likely within 1-2 days - tops. Well worth your consideration to ensure you obtain VERIFIED, hard FACTS vs suppositions.

 

[Mike Plumlee]

Not a minor point, but your appliances+water heater total $7,200 and you were calculating value at $10,000 for them as I recall. I yield to Ms. Crowley's previous comment.

 

[DTB]

Mary B. - simple solution to your dilemma:

Assumptions: your condo is self-managed with an HOA, or utilizes a Management Company. Should that NOT be the case - a trip to the Local Assessor's Office to research closed sales in YOUR condo complex would be in your best interest.

In either case - recommend contacting the respective Mgmt Co. Property Manager, or HOA President, to obtain confirmed closed sale data on units which sold between 300-400 (if any) within the past 2 years. Compare your upgrades to the higher priced units to determine what the Market (buyers) actually paid as contributory value of the additional upgrades you cite (or equivalent upgrades) - IF any report same. Recommend 2007+ versus probable "market bubble high" 2004-2006. I suggest continuted Speculation will accomplish nothing.

Should the Appraiser have dug deeper? That can only be determined either by the Appraiser, the Lender, your RE Agent (if you are using one), OR you.

Should you (the RE Agent, or the Lender) isolate TRULY competitive, confirmed closed sales which demonstrate market reaction to quality and/or renovations ABOVE the current comparables utilized - communicate them to the LENDER and request a Reconsideration of Value.

Older sales beyond 1 year MAY, or may not, require NO Time Adjustment or NEGATIVE Time Adjustment reflecting market conditions variances between their Sale Date and Current Effective Date of Appraisal. Can closed sales OVER 12 months be utilized in addition to more current closed sales, contracted sales, and active listings - YES. Will they require upward, downward, or NO Time Adjustments - that remains to be determine once they are identified and confirmed - after considering all the other comparative elements.

Keep in mind - you may also encounter confirmed info that units with similar upgrades yielded NO additional contributory Values above the highest priced, confirmed, arms-length sales. If so that factor will indicate whether BUYERS actually pay for possibly atypical, above average, upgrades i.e. Functional Obsolescence-Superadequacy.

p.s. In your shoes, I assure you I would hire an Experienced, LOCAL, Ethical Appraiser to perform the Market Data Search for you - most likely within 1-2 days - tops. Well worth your consideration to ensure you obtain VERIFIED, hard FACTS vs suppositions.

Mike,

Mrs. Kravitz, er Mary B has already said she's been in them all. And of course none of them compare to hers.

I see inconsistencies in her posts, from neighbor's closing costs paid to the cost of appliances etc.

40K in a 2nd floor unit of 1300 square feet may indeed be an overimprovement that cannot be supported. No one will convince her of that though. m2:

 

[Mary B]

Not a minor point, but your appliances+water heater total $7,200 and you were calculating value at $10,000 for them as I recall. I yield to Ms. Crowley's previous comment.

With all due respect Mike Plumlee... and I know it's a long thread and perhaps you missed it...

I said "

Forgot that, of course, the appliances don't count. Deduct those and we still have 30,000+ worth of true upgrades.

That is 30,000 PLUS .. meaning I didn't stop to calculate exactly which would have meant taking out my receipt folder so I loosely said PLUS to make a rough estimate of appliances.. meaning - After taking out the appliances - the real upgrades were #30,000+

 

[Mary B]

Maybe the other unit's appraiser came in too high and is the one that is wrong?

Why do you think the appraiser who's opinion of market value that is lower than those involved in the transaction is always the one that's considered wrong?

Maybe the other unit's loan will not close after that appraisal is reviewed?

Yes - I did think that is a possibility. I mentioned that to my agent earlier today. She hadn't even thought of that. I don't understand at all why the other unit's load would not close? After seller closing costs they are buying a condo for 296,750. The place appraised for 300,000. Why is that a problem? Wouldn't they be happy that they got a deal? I don't understand.. Could you explain please?

PS Mike Kennedy - as always - thanks for the very thoughtful response. I'll respond tomorrow and I did send an email to my agent. I don't need to visit the assessor, however, as I looked at every single condo in the community on line - Fairfax County Website is very up to date and accurate (except for seller closing costs which are an important piece).

 

[Mike Kennedy]

Mike,

Mrs. Kravitz, er Mary B has already said she's been in them all. And of course none of them compare to hers.

I see inconsistencies in her posts, from neighbor's closing costs paid to the cost of appliances etc.

40K in a 2nd floor unit of 1300 square feet may indeed be an overimprovement that cannot be supported. No one will convince her of that though. m2:

I agree DTB, hence my very last sentence above - "just the facts" will either confirm her "suspicions" or .........not. Could be, maybe, possibly - will not solve Mary's perceived problem.