Un-permitted Garage Conversion

[hastalavista]

re "as-is"

appraisal "as-is" - there is NO cost to cure because "as-is" IS "as-is".

Can someone kindly post the definition of Highest and Best Illegal Use from either the USPAP, a State's appraiser's Law, or a recognized appraisal industry text. Thanks in advance.

I'll cut to the chase for you, Mike.
From Appraising Residential Properties (4th ed., AI, p. 226):

legal permissibility
One of the four criteria the highest and best use of a property must meet; a property use that is either currently allowed or most probably allowable under zoning codes, building codes, environmental regulations, and other applicable laws and regulations that govern land use restrictions.

An illegal use would be one that isn't allowed. Commercial drive-through restaurant in most residential-zoned areas is a good example of an illegal use.
A non-permitted alteration that is either "currently allowed or most probably allowable under zoning codes, building codes..." etc., does not constitute an illegal use. If it "most probably" would be allowable under the zoning code & building codes, it meets the the legal use benchmark. One just needs to get the permit.

But you are probably more capable of finding the zoning requirement regarding covered parking (garages) requirements in Bakersfield than many appraisers who work in that area.
Does the SFR zoning require covered parking, or do "off street" spaces include open and enclosed parking spaces? If a garage is required, then the conversion (without a replacement) is a non-permitted use that wouldn't be allowable.
If a garage isn't required (just sufficient space on the site and off the street to park 2-cars), then the conversion is likely allowable; one just needs to get a permit.

:new_smile-l:

 

[Ms. Janet]

I'll cut to the chase for you, Mike.
From Appraising Residential Properties (4th ed., AI, p. 226):


An illegal use would be one that isn't allowed. Commercial drive-through restaurant in most residential-zoned areas is a good example of an illegal use.
A non-permitted alteration that is either "currently allowed or most probably allowable under zoning codes, building codes..." etc., does not constitute an illegal use. If it "most probably" would be allowable under the zoning code & building codes, it meets the the legal use benchmark. One just needs to get the permit.

But you are probably more capable of finding the zoning requirement regarding covered parking (garages) requirements in Bakersfield than many appraisers who work in that area.
Does the SFR zoning require covered parking, or do "off street" spaces include open and enclosed parking spaces? If a garage is required, then the conversion (without a replacement) is a non-permitted use that wouldn't be allowable.
If a garage isn't required (just sufficient space on the site and off the street to park 2-cars), then the conversion is likely allowable; one just needs to get a permit.

Now that is a real purty post! Can we make it a sticky to make it easy to copy and paste it in every thread?

 

[Mike Kennedy]

Bakersfield

Title 8 HEALTH AND SAFETY
Chapter 8.80 ABATEMENT OF PUBLIC NUISANCES


8.80.020 General enforcement authority.
Code enforcement officers have the authority and powers necessary to gain compliance with the provisions of the Bakersfield Municipal Code and applicable state codes. For the purposes of this chapter the term “code enforcement officer” shall include building inspectors where applicable.
These powers include the power to issue notices of violations, correction orders, field citations and to inspect public or private property and to use whatever judicial and administrative remedies provided under the Bakersfield Municipal Code or applicable state law. (Ord. 3666 § 2, 1995)

 

[Ms. Janet]

I need to poke my eyes out

 

[Mike Kennedy]

I'll cut to the chase for you, Mike.
From Appraising Residential Properties (4th ed., AI, p. 226):


An illegal use would be one that isn't allowed. Commercial drive-through restaurant in most residential-zoned areas is a good example of an illegal use.
A non-permitted alteration that is either "currently allowed or most probably allowable under zoning codes, building codes..." etc., does not constitute an illegal use. If it "most probably" would be allowable under the zoning code & building codes, it meets the the legal use benchmark. One just needs to get the permit.

But you are probably more capable of finding the zoning requirement regarding covered parking (garages) requirements in Bakersfield than many appraisers who work in that area.
Does the SFR zoning require covered parking, or do "off street" spaces include open and enclosed parking spaces? If a garage is required, then the conversion (without a replacement) is a non-permitted use that wouldn't be allowable.
If a garage isn't required (just sufficient space on the site and off the street to park 2-cars), then the conversion is likely allowable; one just needs to get a permit.

:new_smile-l:

As of an Effective Date of Appraisal, an improvement or use which required a Municipal C.of O. (subsequent to B.P.) at the time of improvement or conversion (in the OPs case), and the EDA, - in municipalities which have governing local, county and/or state building and/or zoning or combo building/zoning ordinances - including the OP's City of Bakersfield - that LACKS legal compliance ON the EDA - represents an illegal improvement and/or use. In the OP's "converted GARAGE > ADU":

A. either the "as-is" converted garage represented a legal, non-conforming pre-existing use, or a legally compliance use, or an illegal use as of the EDA

B. if legal, or legal non-conforming - "as-is" is appropriate.
C. if illegal, appraising the property "as-is"
- absent either an EA or HC and conditional valuation -
is inappropriate, incorrect and w/be intentionally misleading

The definition of Highest and Best Illegal Use ?????

 

[Mike Kennedy]

Page 352 "The Appraisal of Real Estate"

"To value a property with illegal improvements in its' "as-is" state, the appraisal must reflect the cost to remedy the illegality i.e. either to remove the illegal improvements or obtain legal permissibility.

Obtaining legal permissibility might include upgrading the improvements so that they conform to building codes and the payment of fees or fines.

If a market exists for the illegal use, the prices paid do not necessarily represent Market Value because Market Value is based on the highest and best use of a property and highest and best use is based on a legal use."

 

[Mike Kennedy]

Is HBU best reflected by the current improvements if the non-permitted conversion results in an improvement that does not pass all 4 tests?

Does the JA typically require conversion of a non-permitted area back to its original and legal use/configuration, prior to a transfer--like a very few JA's do in SoCal?

Does market reaction trump HBU if that type of physical status readily exists in the local market?

...no and ........no.

 

[Mike Kennedy]

Additional Example:

City of Dublin, CA

8.144.050 Compliance.

A. Actions contrary to Title 8 are unlawful and a public nuisance. Any building or structure set up, erected, constructed, altered, enlarged, converted, moved or maintained contrary to Title 8; or any use or occupancy of any land, building or premises established, conducted, operated or maintained contrary to Title 8 is unlawful and is hereby declared to be a public nuisance and may be summarily abated as such.


8.144.060 Violations.

A. Infraction/Misdemeanor. Notwithstanding Section 1.04.030 of the Dublin Municipal Code, any person, firm, or corporation violating or causing, or permitting to be violated, or failing to comply with any of the provisions of Title 8 shall be guilty of an infraction unless such violation is described as a misdemeanor by specific provisions of Title 8.
B. Separate offense. Each person, firm, or corporation shall be guilty of a separate offense for each day and every day during any portion of which any violation of any provision of Title 8 is committed, continued or permitted by such person, firm, or corporation, and shall be punishable accordingly.

1.04.030 Violations as misdemeanors or infractions—Penalties.

A. Violation of any provision of this code shall constitute a misdemeanor and shall be punishable by imprisonment in the County Jail not exceeding six (6) months, or by fine not exceeding one thousand dollars ($1,000), or by both, unless expressly described as an infraction. Notwithstanding the preceding sentence, or any other provision of this code, a violation of this code may, in the discretion of the designated enforcement officer, or if no enforcement officer is indicated, in the discretion of the City Attorney, be charged and prosecuted as an infraction.
B. Except as otherwise provided in this code, any person convicted of an infraction under this code shall be punished by a fine of not more than one hundred dollars ($100) for a first violation; a fine not exceeding two hundred dollars ($200) for a second violation of the same code section within one year of the first violation; and a fine not exceeding five hundred dollars ($500) for each additional violation of the same code section within one year of the first violation. Any person convicted of three (3) or more infractions within a twelve (12) month period following the first violation may, in the discretion of the designated enforcement officer, or if no enforcement officer is indicated, in the discretion of the City Attorney, be charged and prosecuted for a misdemeanor for any additional violations of the same code section.
C. Causing, permitting, aiding, abetting or concealing a violation of any provision of this code shall constitute a violation of such provision.
D. A separate offense shall be deemed committed each day a violation of any provision of this code occurs or continues. (Ord. 1-07 § 1: Ord. 21-86 § 3; Ord. 13 § 1 (part), 1982)



http://www.codepublishing.com/ca/dublin.html

 

[Mike Kennedy]

BAKERSFIELD, CA BAKERSFIELD CALIFORNIAN ARTICLE ON POINT

http://www.bakersfieldcalifornian.c...age-conversions-leave-home-buyers-in-quandary

 

[J Grant]

Appraisers frequently use the word "illegal" when they mean not permitted ( as in owner did not get a permit when constructed or changed). I wonder if those appraisers understand the difference or are just using the wrong terminology.