Appraise House Combined With Extra Lot?

[Timothy Wixted]

Originally posted by Pamela Crowley (Florida)@Oct 25 2004, 07:29 AM
Which is exactly what I did. I already knew the buyer might plan to build on or very near the center lot line and that is the HC I used, fully explained along with the full explanations of Surplus and Excess Land, for the combined value. In this case, the buyers potential purchase of these 2 separate sites was at full value for 2 separate sites. The value of these 2 sites if combined into 1 site by building on or too close to the center line was a lot less than if they stayed separate.

Pam-

In my opinion, you got it right. From your original post, it seemed to me that just because you were doing two appraisals under one report cover, the value was diminished. I should've known better. Because as everyone knows- you are da bomb.

Tim

 

[Timothy Wixted]

Originally posted by Timothy Wixted+Oct 25 2004, 08:45 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Timothy Wixted @ Oct 25 2004, 08:45 PM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Pamela Crowley (Florida)@Oct 25 2004, 07:29 AM
Which is exactly what I did. I already knew the buyer might plan to build on or very near the center lot line and that is the HC I used, fully explained along with the full explanations of Surplus and Excess Land, for the combined value. In this case, the buyers potential purchase of these 2 separate sites was at full value for 2 separate sites. The value of these 2 sites if combined into 1 site by building on or too close to the center line was a lot less than if they stayed separate.

Pam-

In my opinion, you got it right. From your original post, it seemed to me that just because you were doing two appraisals under one report cover, the value was diminished. I should've known better. Because as everyone knows- you are da bomb.

Tim [/b][/quote]
Pam-

Upon further reflection, I think your client would have been better served with a fourth value, the value of the the two lots combined (A +B) without a HC.

This way it would be the lender's decision on how to proceed.

If in fact the buyer did decide to build on or near the property line, he could do it

A-with his own money and the lender would still be covered

B- with a construction loan from a new lender that paid off the mortgage on the
land (no lender is going to lend on new construction with the mortgage on the land being held by another lender)

C- a new loan from the original lender. The new appraisal would (in theory) reflect the diminished value of the land.

Under any scenario, your client would be covered.

Tim

 

[Pamela Crowley (Florida)]

Part of my 'discussion' within that narrative mess included that if the owner decided to place all building(s) within the legal side setbacks, the still vacant site would retain it's individual site value - or a barn that was built, depending on it's location on the site without the house, could add value to that site.

Believe me, I really covered all the bases I could think of on that one.