2 Parcels sold together

[PropertyEconomics]

My question would be, how is title held now? It must be different here, but in a case like this, we start with the deed and go from there. It sounds like we rely on the deed more than other parts of the country.

Are you saying two parcels held by one deed cannot be sold seperately by antoher deed?

 

[Noreen]

Are you saying two parcels held by one deed cannot be sold seperately by antoher deed?

Oh no, here, under our "laws of conveyance", two parcels can have full descriptions on one deed, however when one parcel is broken off and sold separate, a new deed is drawn to reflect the new separate recording. I have seen "margin references" to reflect the sale of a parcel off the "mother lot or deed".

 

[biker4ever]

What is bizarre is that you can have 2 parcels combined in a Sale. Now, if the 2nd parcel is a stand alone parcel with its own ingress/egress, the Buyers will not be able to refi the property with both lots combined.

 

[Michigan CG]

.....Remember the client always chooses the subject property ... you take over after that.

The client can choose the property but they cannot ask the appraiser to adhere to an unacceptable assignment condition. Two parcels does not mean they are appraised as if one without disclosure.

Client can want two parcels appraised, Highest and Best Use determines how they are appraised.

 

[Lee Lansford]

My question would be, how is title held now? It must be different here, but in a case like this, we start with the deed and go from there. It sounds like we rely on the deed more than other parts of the country.

I frequently see and read of appraisers who will approach this appraisal challenge with a "one size fits all" mentality (as in "I do it THIS way...") in the erroneous belief that they can "explain away" whatever isn't convenient on the road to satisfying the want of the client.

The OP has a "subject" that is two parcels; one parcel contains the improvements and the other is vacant. I assume (but don't have certainty) that the appraisal is for a residential mortgage, the loan is headed to the secondary market, and the appraisal is communicated (in part) via the 1004.

If the vacant parcel has its own separate H&B Use, the question becomes what results in the optimum market value: the two parcels as one entity or the two as separate entities? IF the rightful conclusion is the latter, the appraisal cannot be communicated with a single value opinion as the appraiser cannot answer "yes" to the question "Is the H&B Use of subject property as improved...the current use?".

 

[Appraisal Time]

There are certainly a few issues associated with your question and there is no "one size fits all" correct response.

I assume that you are asking this from the perspective of appraising for use in residential lending and a loan headed to the secondary market. The use and the user(s) of the appraisal certainly impact how this situation might be approached. Also, it is important whether or not each parcel has its' own separate H&B Use.

sounds like you may have to address the assemblage issue... or is it considered excess land or surplus land?
Can you sell off the parcels separately?

-ray

Because parcels are deeded together does not mean they are tied together other than they are included on the same deed .... each can have their own legal description, each can be assessed separately, and each can be sold separately in most jurisdictions.

To answer your question you should have a conversation with your client as to what they wish to have appraised .. I dont think its your call to make the decision. Remember the client always chooses the subject property ... you take over after that.

This appraisal is not for fannie. This is for a purchaser's informational purposes. This is a cash deal. The lots are side by side. The lot without an improvement is buildable and can be sold separately with an improvement or not. It is also deeded separately and assesed separately. The seller is just chosing to sell them together and the purchaser has chosen to buy them together. I have include in the report that the lots are separate and buildable. Just wondering if it would be more proper to leave the improved parcel as one parcel in the report and list the other parcel as being sold together with it or to combine the acreage in the site section and the list both parcel ID numbers in subject section? The site with the improvement is 6 acres and the adjoining site without the improvement is 4 acres, so obviously I would end up with 10 total acres. So do I Combine or dont combine? Either way I still have to figure in the value as if it were 10 acres since they are both being sold together.

 

[Michigan CG]

The start of any appraisal question is HIGHEST AND BEST USE.

....The lots are side by side. The lot without an improvement is buildable and can be sold separately with an improvement on not. It is also deeded separately and assesed separately.......

Two lots, both buildable.

......Just wondering if it would be more proper to leave the improved parcel as one parcel in the report and list the other parcel as being sold together with it or to combine the acreage in the site section and the list both parcel ID numbers in subject section?.....

What is the maximum productivity of the two parcels, being one or being two?

......Either way I still have to figure in the value as if it were 10 acres since they are both being sold together.

NO you don't.

If the parcels are sold separately to two different buyers is it the same as selling one 10-acre parcel?

You have two separate legal parcels, both can have improvements, it is legal and it is physically possible; two parcels, two reports, two values, don't add them together.

UNLESS of course there is some SOW agreement to appraise them hypothetically as one which would diminish the value.

 

[CANative]

You have two separate legal parcels, both can have improvements, it is legal and it is physically possible; two parcels, two reports, two values, don't add them together.

Agree (except you can include both appraisals in the same report if you want to or if the client wants you to.)

 

[PropertyEconomics]

This appraisal is not for fannie. This is for a purchaser's informational purposes. This is a cash deal. The lots are side by side. The lot without an improvement is buildable and can be sold separately with an improvement on not. It is also deeded separately and assesed separately. The seller is just chosing to sell them together and the purchaser has chosen to buy them together. I have include in the report that the lots are separate and buildable. Just wondering if it would be more proper to leave the improved parcel as one parcel in the report and list the other parcel as being sold together with it or to combine the acreage in the site section and the list both parcel ID numbers in subject section? The site with the improvement is 6 acres and the adjoining site without the improvement is 4 acres, so obviously I would end up with 10 total acres. So do I Combine or dont combine? Either way I still have to figure in the value as if it were 10 acres since they are both being sold together.

I am not being flippant here but you do not have 10 acres of land ... you have a six acre parcel and a four acre parcel which are separately assessed and legally described. 10 acres and a six and a four acre parcel are not the same thing.

Simply becuase they have been sold in one transaction does not mean they are sold as one tract or parcel of land .. they were sold together as separate tracts and that is how they should be valued, particularly given the assignment you have as I understand it.

 

[Appraisal Time]

You have two separate legal parcels, both can have improvements, it is legal and it is physically possible; two parcels, two reports, two values, don't add them together.

Thats what I was thinking.

Agree (except you can include both appraisals in the same report if you want to or if the client wants you to.)

Yeah, I agree with you.