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Must appraisal GLA be based on city records GLA?

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Gavin:

I have one question: Did you have to go to another lender, or were you able to work this out with your original lender?

Thanks
 
Gavin,

I'd be careful slandering people. Just because you were able to either bully or talk some appraiser into doing your bidding doesn't mean that me or my appraiser was inept. I told you before all you had to do is have a code enforcement officer come out and approve the extra area and I'd re-appraise it for free. You decided not to do that. I wonder why? Stop slandering me! Get your refi and hope that you never have to sell your home and find that you were in conspiricy with some appraiser to overvalue your home.

I don't want this to get personal. The value our company opined to is 100% correct, since it is 100% our opinion. Use the new value and have a great life.
 
Denis DeSaix said:
Gavin:

I have one question: Did you have to go to another lender, or were you able to work this out with your original lender?

Thanks
Click to expand...
Denis,
I had to restart the entire process, and is with a different lender. Time consuming and costly, it was, to have to do that.
gavin
 
I told you before all you had to do is have a code enforcement officer come out and approve the extra area and I'd re-appraise it for free
Click to expand...

Dan... was there something obvious during your inspection that would lead you to believe the improvements were sub-standard, didn't meet code requirements, or were not a legal use?
 
Dan,
You wonder why I haven't completed the legalization process (to change city records)? Because it is a very slow process, and I'm working through the steps currently.

Regarding your offer to reappraise once city records are changed, why don't you do that right now, as a mental exercise? You have all the information you need - measurements, photos, comps, etc. Determine value assuming 2,164 sq-ft.

If you end up with the same valuation as before, $758,000, it would be due to a flawed analysis (using a house with 1,060 sq-ft as a primary comp, $600/sq-ft, and adjusting at ~$60 sq-ft; valid comps put the value at recent appraised value).
If you end up with valuation significantly different (say $1,200,000 - $1,350,000), then the implication is that the market would pay $450,000 - $600,000 less for the home due to the non-permit issue. I have asked many times for you to provide your basis for this very significant market reaction to lack of permits. You won't provide this, because you can't.

Also, the house next door (to the right in this photo) just closed late January for $1,350,000 in a "distress" sale (as described in the appraisal, he had spoken with the listing agent, no MLS, had to sell fast due to purchasing a new house prior to selling). The house is same construction, basic shape & interior quality (2 full floors, 3rd/top floor gabled), city records shows it as 1,285 sq-ft (market reaction to this?), the lower level is not accessible from the main house, is a rental unit.

Had you been asked to appraise this house, what valuation would you have arrived at?
I guess you are claiming the new owners overpaid by ~$600,000?

I am quite confident that all the facts are on my side on this. Your company completely screwed up on this. And it caused time & money loss for me, my broker, and my lender.
gavin
 
gavin said:
Denis,
I had to restart the entire process, and is with a different lender. Time consuming and costly, it was, to have to do that.
gavin
Click to expand...

That is unfortunate.

I'm glad that this is resolved for you.


BTW, my office is in Dublin, but I do about 30% of my work in San Francisco. What you describe; finished area used as living area, is extremely common in the city (in general) and in your specific neighborhood (I was just out there yesterday, and will be back there on Friday).
When these areas match or are similar to the quality/condition/and functionality of the main improvement, they many times command a value at or very close to living area by the market participants.

There are always exceptions, and I'm not offering an opinion on your prior appraisal or the most recent one.
I only say that, in general, the area that you have described for your home, I've seen valued as living area by the market participants. In some cases, I've interviewed agents where their opinion is that there may be a slight discount for the lack of permits, but the discount isn't significant, if it exists at all.
(Remember, I'm talking about (a) an area that is finished to a similar level quality/condition as the main improvement, (b) the area is fully functional as living area; such as standard ceiling height, direct interior access to the primary living area, sufficient windows/doorways for ingress/egress, etc. in other words, the downstairs contributes to the overall functional utility of the main improvement without impairments.)


Good luck!!

Denis
 
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gavin said:
Dan,
You wonder why I haven't completed the legalization process (to change city records)? Because it is a very slow process, and I'm working through the steps currently.

Regarding your offer to reappraise once city records are changed, why don't you do that right now, as a mental exercise? You have all the information you need - measurements, photos, comps, etc. Determine value assuming 2,164 sq-ft.

If you end up with the same valuation as before, $758,000, it would be due to a flawed analysis (using a house with 1,060 sq-ft as a primary comp, $600/sq-ft, and adjusting at ~$60 sq-ft; valid comps put the value at recent appraised value).
If you end up with valuation significantly different (say $1,200,000 - $1,350,000), then the implication is that the market would pay $450,000 - $600,000 less for the home due to the non-permit issue. I have asked many times for you to provide your basis for this very significant market reaction to lack of permits. You won't provide this, because you can't.

Also, the house next door (to the right in this photo) just closed late January for $1,350,000 in a "distress" sale (as described in the appraisal, he had spoken with the listing agent, no MLS, had to sell fast due to purchasing a new house prior to selling). The house is same construction, basic shape & interior quality (2 full floors, 3rd/top floor gabled), city records shows it as 1,285 sq-ft (market reaction to this?), the lower level is not accessible from the main house, is a rental unit.

Had you been asked to appraise this house, what valuation would you have arrived at?
I guess you are claiming the new owners overpaid by ~$600,000?

I am quite confident that all the facts are on my side on this. Your company completely screwed up on this. And it caused time & money loss for me, my broker, and my lender.
gavin
Click to expand...

If the property were located in New York where they have permit police like Mike Kennedy, the area would have no value at all.

It could be that the specific lender would only accept value from the appraiser for the permitted area. I don't know.
 
gavin said:
The permit report at time of purchase lists: 1957: Repair front steps; 1979: comply with BBI file 18391; 2006: Reroof. In 2010 I pulled permits to repair rear foundation.

The use is not "illegal," to my best guess as to what this implies.
Click to expand...

PDF See Bottom Page 4, Top Page 5, and Page 6 Blue Bullet 1 << especially converting unfin.bsmt. to finished rooms - livable area

also suggest reviewing the Paragraphs on Violation "Abatement" and "Assessment of Costs" and definitely reading Pages 7 to 12.

http://www.sfdbi.org/ftp/uploadedfiles/dbi/Key_Information/Code Enforcement Process.pdf
 
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