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A different kind of Web Footed Critter, how woudl you deal with it?

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Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
I have a subject in a resort development. Sold two years ago for $375K it is a Pent House Condo top floor looks out to lake. Interior of subject is one room, with bed in center, corner fireplace, jet tub in another corner, small refrigerator and Microwave in another corner, laundry room 4 x 12 off foyer; walk through bath room from foyer into main room. Balcony, GLA is 400 sq, ft. I have never seen until this resort a condo unit where you access the main living area through a walk through bathroom. (How did the original appraisers miss this as a functional obsolesces? Or am I wrong in my thinking that this would be a major functional obsolesce and should have been adjusted for?)

There have been no current sales of this type unit in the past 14 month with the standard listing and showing of the units. There have been three auction sales of $65K, 61K, and 59K in the past two months. Parts of the phases in the resort are not complete and sales have all but stopped except for the auction sales.

There are no other similar sales in the area with such floor plan. There will be two more model matches coming up for auction in 30 days. In addition to other larger Pent House Units with 1500 GLA and standard first and second floor units with 1200 GLA. All will be going on the auction block in thirty days with opening bid of $50K. In the future there will be many more, and their have been 10 units placed at auction in the past 12 months, but they were not similar to this unit.

This appraisal is for Refi and PMI removal.

My thinking is to use the auction sales as the comparable sales. As I considered then arms length, showing the current market conditions. Then note in the report that there are other units coming up for auction, the general contractor has been foreclosed on, that other phases in the development are not completed and no time frame has been set for there completion. That green areas and amenities are not complete. Buyers are being entertained at present to complete the resort. Junior Partners are trying to buy the bank out and complete the project. That the resort condo units are moving to the condo-tel form of business in order to try and survive and keep on going services for the owners. That I have no knowledge if this unit is part of the new condotel strategy or will become part of that strategy. Many units have converted to the condotel concept. Those on site personal are very tight lipped about what is going on. That they refused to let the auction company place any type of coming up for auction signs on the property, because they say the association rules do not allow signage with in the resort. (My gut feeling to the signage issue is the sales department don’t want other buyers to know that a number of units have been foreclosed on, that the resort is in foreclosure as it would wreck havoc with any new sales at the preconceived value in the $295K to $500K range).

How would you treat this assignment?????
 

Mike Boyd

Elite Member
Joined
Jan 18, 2002
Professional Status
Retired Appraiser
State
California
Yes, use the auction sales as comps and explain everything that you have written here. (after correcting your spelling.)
 

Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Yes, use the auction sales as comps and explain everything that you have written here. (after correcting your spelling.)


Spell check is as bad as I am. I ready did write it in word, still trying.

Thanks Mr. Boyd.
 
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