1004 or 1073?

[Airstream]

Unless it's a lease hold estate, if the title anywhere says condo, you must use the condo form.

Even if they're townhomes with owned lands.

Condo is an ownership type. The language appears in legal because in addition to the individual sites, there is also commons area lands which require HOA dues and a PUD structure to maintain.

Everything with community commons elements which are private and not maintained by the city/county are probably going to be on condo form.

For appraisers the difference can be negligable. You can often successfully comp a standard townhome which you'd complete on a 1004 form, against a similar townhome which you must complete on the condo form. The form difference is due to insurability requirements and packaging loans. Because there are different legal requirements for servicing in community developments.

These are done on the 1004. And I have done these for Wells Fargo, USBank, and other banks. The only one I have come across that wants these types of properties on a 1073 is FHA. Maybe there are more, I just haven’t run across them.

And the 1073 is a terrible form for these properties (it is not negligible) that have a legal description of condominium YET they own acreage and function as a single family detached residence like any other. And I know of many SFR’s that have common elements and own common land areas that do not have condominium in their legal. They are all over the place in the county I do appraisals. Trying to use the 1073 is like fitting a square peg through a round hole.

 

[Airstream]

The GSE's will allow site condos and HPS properties to be reported on the 1004. IMO, however, this is inappropriate, as there is no site 'under the house'. All property types where ownership of the land is held in common, IMO, should be reported on the 1073 (assuming the intended use is for mortgage lending purposes, that is).

Yes there is a site under the house. I just did one that owns a 2.9 acre site. Every single property in the complex owns a site with specific dimensions. And those sites in the past sold just like vacant land sites with specific dimensions and acreage.

 

[Airstream]

Sounds like a leasehold estate. Those do go on the 1004, even if they're modulars and not stick or manufactured.

No, not a leasehold estate. From the responses in this thread it seems like people are not understanding what I am talking about. These properties have specific sites owned in fee simple. If they had no improvements they would still own the site with acreage just like any other vacant land sites. They are NOT leasehold estates.

 

[Cob]

Hello,

I received a request to appraise this property. The lender ordered a 1004, however after reading the legal description I wasn't so sure. Any recommendations? Thank you, Jon

VILLAGIO AT HAPPY VALLEY CONDOMINIUM MCR 915-34 UNIT 102 (PLEASE NOTE: FOR LEGAL DESCRIPTION REFERENCES REGARDING THE PERCENTAGE OF OWNERSHIP OF THE COMMON AREA(S) PLEASE REFER TO THE RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS (CCR) ASSOCIATED WITH THIS PLAT.)

If the property is a Condo that is detached and is located in a community that feature the same type of properties, the appraiser can complete the appraisal report on a 1004 or 1073, I always explain this to the client/lender and have them decide which they prefer.

 

[GWISC]

If it is a site condo, but where the site has a defined size and the condo unit sites are sold for varying prices depending on size, then I generally report on the 1004. Mostly, because cost approach will apply (especially if it is new or newer construction). There is no cost approach on the condo form and I am not going to work up a cost approach in the narrative addendum. I explain, in the narrative, the property is a site condo with ownership to the site (The one development we have explains the ownership of the land in detail in the condo decs which I copy into my report and highlight for the underwriter). Anyway, my decision maker is if the cost approach applies, then 1004.