"Minimum Requirements" ?

[ZZGAMAZZ]

I think I have a reasonable understanding of the concept of "Minimal Requirements" that pertain to most appraisal regulatory standards, and I also am aware that assignment conditions often pertain to client rather than industry requirements; but I have two questions:

1) Would an appraiser who wishes to conduct a brief interior inspection of a 2055 exterior-only inspection, in order to reduce reliance upon EA's, without worrying about the time needed or the fee, be appropriate to do so, or should I request permission from lending client to do so? [I'm aware that the AF doesn't usually support exterior-only assignment conditions but that isn't for discussion please.]

2) Industry requirements to demonstrate market reaction typically is required in most instances, but I'm unsure how to respond to the client/lender of a residential re-fi assignment who says point blank that "no value can be given to any non-permitted additional unit, e.g, garage-to-living-area guest unit. What if I can demonstrate market reaction based upon multiple comps that are similar non-permitted conversions like the subject? Would peers question the client/lender for clarificatioh?

Maybe I should post in the Newby Forum because these are Appraisal 101 issues, Thanks as always to the AF. [BTW, I've been unavailable for a couple of weeks and apologize if I failed to respond promptly to other threads. Being older now is so damn time-consuming. I might not be able to extend my working career til 85 years of age like I planned. Damn...]

 

[glenn walker]

Time to call it quits. No offence but 20 plus years the light doesn't seem to be staying on. Why do you insist on making easy assignments into hard assignments and don't you think the clients are going to give up on you at some point ?

 

[Fernando]

I think I have a reasonable understanding of the concept of "Minimal Requirements" that pertain to most appraisal regulatory standards, and I also am aware that assignment conditions often pertain to client rather than industry requirements; but I have two questions:

1) Would an appraiser who wishes to conduct a brief interior inspection of a 2055 exterior-only inspection, in order to reduce reliance upon EA's, without worrying about the time needed or the fee, be appropriate to do so, or should I request permission from lending client to do so? [I'm aware that the AF doesn't usually support exterior-only assignment conditions but that isn't for discussion please.]

During Covid and even before if I do an exterior, I may pick through the windows thus technically never went inside. When I go to an open house, I just need to see the kitchen and bathroom and I quickly have an idea of the condition of the home. Be smart, outsmart the standards.

2) Industry requirements to demonstrate market reaction typically is required in most instances, but I'm unsure how to respond to the client/lender of a residential re-fi assignment who says point blank that "no value can be given to any non-permitted additional unit, e.g, garage-to-living-area guest unit. What if I can demonstrate market reaction based upon multiple comps that are similar non-permitted conversions like the subject? Would peers question the client/lender for clarificatioh?

Maybe I should post in the Newby Forum because these are Appraisal 101 issues, Thanks as always to the AF. [BTW, I've been unavailable for a couple of weeks and apologize if I failed to respond promptly to other threads. Being older now is so damn time-consuming. I might not be able to extend my working career til 85 years of age like I planned. Damn...]

If not permitted, I can still consider the room as a finished storage room which has some value. Outsmart the standards.
College education does help in critical thinking and thinking out of the box.

 

[J Grant]

I think I have a reasonable understanding of the concept of "Minimal Requirements" that pertain to most appraisal regulatory standards, and I also am aware that assignment conditions often pertain to client rather than industry requirements; but I have two questions:

1) Would an appraiser who wishes to conduct a brief interior inspection of a 2055 exterior-only inspection, in order to reduce reliance upon EA's, without worrying about the time needed or the fee, be appropriate to do so, or should I request permission from lending client to do so? [I'm aware that the AF doesn't usually support exterior-only assignment conditions but that isn't for discussion please.]

2) Industry requirements to demonstrate market reaction typically is required in most instances, but I'm unsure how to respond to the client/lender of a residential re-fi assignment who says point blank that "no value can be given to any non-permitted additional unit, e.g, garage-to-living-area guest unit. What if I can demonstrate market reaction based upon multiple comps that are similar non-permitted conversions like the subject? Would peers question the client/lender for clarificatioh?

Maybe I should post in the Newby Forum because these are Appraisal 101 issues, Thanks as always to the AF. [BTW, I've been unavailable for a couple of weeks and apologize if I failed to respond promptly to other threads. Being older now is so damn time-consuming. I might not be able to extend my working career til 85 years of age like I planned. Damn...]

The first, yes you can exceed minimums. Check with the client, though, in case a homeowner does not want to be disturbed with an ext assignment.

The second - if a client commands you to ignore value contribution property features , that can be an unacceptable assignment condition.

 

[Fernando]

The first, yes you can exceed minimums. Check with the client, though, in case a homeowner does not want to be disturbed with an ext assignment.

Expectation of client is lower for exterior inspection. Once you give notice that you went inside, you're liability of matters inside goes up. Best not to say you went inside.

The second - if a client commands you to ignore value contribution property features , that can be an unacceptable assignment condition.

Client can tell you to ignore but it may have value to the market. Be creative or consider it in your reconciliation.

 

[Tom4value]

I think I have a reasonable understanding of the concept of "Minimal Requirements" that pertain to most appraisal regulatory standards, and I also am aware that assignment conditions often pertain to client rather than industry requirements; but I have two questions:

1) Would an appraiser who wishes to conduct a brief interior inspection of a 2055 exterior-only inspection, in order to reduce reliance upon EA's, without worrying about the time needed or the fee, be appropriate to do so, or should I request permission from lending client to do so? [I'm aware that the AF doesn't usually support exterior-only assignment conditions but that isn't for discussion please.]

2) Industry requirements to demonstrate market reaction typically is required in most instances, but I'm unsure how to respond to the client/lender of a residential re-fi assignment who says point blank that "no value can be given to any non-permitted additional unit, e.g, garage-to-living-area guest unit. What if I can demonstrate market reaction based upon multiple comps that are similar non-permitted conversions like the subject? Would peers question the client/lender for clarificatioh?

Maybe I should post in the Newby Forum because these are Appraisal 101 issues, Thanks as always to the AF. [BTW, I've been unavailable for a couple of weeks and apologize if I failed to respond promptly to other threads. Being older now is so damn time-consuming. I might not be able to extend my working career til 85 years of age like I planned. Damn...]

1. I don’t see how you can do an interior inspection; even brief, without asking the homeowner to do so. As J said, the client probably told the homeowner you won’t be calling so, no, don’t do it.

2. Again, J Grant said it; that is an unacceptable condition. You are appraising the property in its highest and best use. To ignore something that adds value not only violates that but also violates the USPAP rule of not providing a misleading appraisal. My guess is the client doesn’t want to deal with it. Tough! Be a hero and point out that GSEs will accept properties in these circumstances if you can prove what you say.

Ask any questions you want here! Your questions are good and not “101”. Ignore the posts that ridicule you and just pay attention to the ones that help answer your questions.

 

[ZZGAMAZZ]

1. I don’t see how you can do an interior inspection; even brief, without asking the homeowner to do so. As J said, the client probably told the homeowner you won’t be calling so, no, don’t do it.

2. Again, J Grant said it; that is an unacceptable condition. You are appraising the property in its highest and best use. To ignore something that adds value not only violates that but also violates the USPAP rule of not providing a misleading appraisal. My guess is the client doesn’t want to deal with it. Tough! Be a hero and point out that GSEs will accept properties in these circumstances if you can prove what you say.

Ask any questions you want here! Your questions are good and not “101”. Ignore the posts that ridicule you and just pay attention to the ones that help answer your questions.

THANKS. I honestly don't understand how any residential appraiser could survive without being involved with the AF.

 

[Tom D]

I love doing drive by. Big city, seen 1 row home, seen them all. If the lender wants an interior they request it, period. I try to see if and when it was last listed. A previous listing can say a lot. What do you mean by non permitted use, you haven't seen the inside. And you know comps that have the same non permitted use. Pretty deep knowledge there.

And non permitted use. Do you mean an illegal use, or some work done without permits.

 

[ZZGAMAZZ]

I love doing drive by. Big city, seen 1 row home, seen them all. If the lender wants an interior they request it, period. I try to see if and when it was last listed. A previous listing can say a lot. What do you mean by non permitted use, you haven't seen the inside. And you know comps that have the same non permitted use. Pretty deep knowledge there.

And non permitted use. Do you mean an illegal use, or some work done without permits.

I mentioned two different assignments in the same post. My bad. Never know how much or how little is best on the AF. Nevertheless, the Non-permitted comments pertains to a garage to studio unit conversion on a lot in which a guest unit/ADU/etc is "legally permissible" but the conversion with not "legally permitted," in Inglewood. Interesting similar scenario was last week in Palm Desert where the subject improvements included a garage-to-studio unit in very nice condition, but done without permits. Consequently it couldn't be defined as an ADU because to do so would require building permits; and the city's developmental standards document defers the definition of a non-permitted supplemental living unit as an "Efficiency Unit" based upon CA building code standards. And because it is an Efficiency Unit rather than an ADU, the statewide standards that supersede the city requirement requirement for a garage DO NOT apply. Consequently the appraiser defined zoning compliance as "illegal" rather than "legal conforming" because a garage is required, we i6 3we on the recent retrospective date when the conversion appears to have been completed. Now OTOH how the market reacts to the distinction is vague without much data upon which the appraiser can make that decision, although the potential legal income factor is diminished because non-permitted supplemental living areas cannot be [legally] leased in that jurisdiction per the Code and confirmed by a city Planner. I like to think that the time it took me to crawl into that rabbit home was warranted, although the tangible, specific impact on market reaction to the zoning non-compliance wasn't definitive in the appraisal, because like almost always there wasn't much data upon which one could make a definitive decision, even an "opinion" rather than a "fact." ???????????????/

 

[Fernando]

I mentioned two different assignments in the same post. My bad. Never know how much or how little is best on the AF. Nevertheless, the Non-permitted comments pertains to a garage to studio unit conversion on a lot in which a guest unit/ADU/etc is "legally permissible" but the conversion with not "legally permitted," in Inglewood. Interesting similar scenario was last week in Palm Desert where the subject improvements included a garage-to-studio unit in very nice condition, but done without permits. Consequently it couldn't be defined as an ADU because to do so would require building permits; and the city's developmental standards document defers the definition of a non-permitted supplemental living unit as an "Efficiency Unit" based upon CA building code standards. And because it is an Efficiency Unit rather than an ADU, the statewide standards that supersede the city requirement requirement for a garage DO NOT apply. Consequently the appraiser defined zoning compliance as "illegal" rather than "legal conforming" because a garage is required, we i6 3we on the recent retrospective date when the conversion appears to have been completed. Now OTOH how the market reacts to the distinction is vague without much data upon which the appraiser can make that decision, although the potential legal income factor is diminished because non-permitted supplemental living areas cannot be [legally] leased in that jurisdiction per the Code and confirmed by a city Planner. I like to think that the time it took me to crawl into that rabbit home was warranted, although the tangible, specific impact on market reaction to the zoning non-compliance wasn't definitive in the appraisal, because like almost always there wasn't much data upon which one could make a definitive decision, even an "opinion" rather than a "fact." ???????????????/

A separate ADU is worth more than an ADU converted in a garage besides the fact it may not be done legally and you lose garage parking.