Adjustment For Unusual Feature

[Doug Wegener]

I have a house that in addition to the gas FWA and central air conditioning has a hydronic system to heat all the floors including the attached garage and RV garage, over 5500 SF total. Cost to install was $30,000 to $40,000 in a $600,000- $700,000 price range house.

I have no data to extra an adjustment. Although a nice feature, I cannot prove the market will pay anywhere near cost and I doubt it would.

My feeling is that the best way to handle it is not to make a single line adjustment but consider it in the overall quality and lean toward the higher end of my adjusted range, but I would like to hear what others have to say about this.

 

[J Grant]

I agree. I do that in these situations and have never had an issue. Such an upgrade is referred to as a super adequacy. While buyers may appreciate it, they dont' set out looking for it and may be reluctant to pay any additional $ for it any additional $ they do pay is reflected in the total price and hard to isolate oul. Usually homeowners who put in these features upgrade the entire house so include it as part of that

 

[Doug Wegener]

I agree. I do that in these situations and have never had an issue. Such an upgrade is referred to as a super adequacy. While buyers may appreciate it, they dont' set out looking for it and may be reluctant to pay any additional $ for it any additional $ they do pay is reflected in the total price and hard to isolate oul. Usually homeowners who put in these features upgrade the entire house so include it as part of that

Thanks J Grant, the response is appreciated.

 

[Slappy]

I agree. I have had situations similar. I would state that the market has not adequately demonstrated that buyers would pay a significant premium for this amenity (no good comps) and be done with it. Without market support we are getting "speculative" in assigning a market contribution. People just sometimes upgrade their homes to personal tastes without consideration of a market cost recovery.

 

[Deleted member 128537]

Yep. Consider it in the quality and be done with it. No data. No adjustment. Also could consider in reconciliation and skew toward a higher value if justified. But I always think if a feature is unusual it doesn't have much market acceptance and people aren't willing to pay much if any extra for it.

By the way if a house has a passive hydronic heat system without an air exchanger that is going to be a problem. Generally this leads to too high of humidity in the house and the result will be windows will get damp and decay. I see this ALL the time in Wisconsin homes that have passive heating systems.

 

[Mike Garrett RAA]

While it might have a "value in use" I have no clue as to the market reaction to it.

 

[Michael S]

I have a house that in addition to the gas FWA and central air conditioning has a hydronic system to heat all the floors including the attached garage and RV garage, over 5500 SF total. Cost to install was $30,000 to $40,000 in a $600,000- $700,000 price range house.

I have no data to extra an adjustment. Although a nice feature, I cannot prove the market will pay anywhere near cost and I doubt it would.

My feeling is that the best way to handle it is not to make a single line adjustment but consider it in the overall quality and lean toward the higher end of my adjusted range, but I would like to hear what others have to say about this.

What part of California? Seems like it would be a waste in a lot of parts. I knew someone with a similar system in Las Cruces, NM (30 miles north of El Paso, snows about once a decade) and it got used maybe a month or two out of the year. Heck even at 5,000 feet here in Albuquerque our heat has been on for a grand total of about 3 hours this fall. It's still hitting 75+ most days. Go a few hours further north to Taos at 7,000 feet and some buildings don't have any cooling at all but radiant heat is very prevalent.