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Borrower Owns Two Adjoining Parcels, One Is Vacant Land

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ratherbefishing

Freshman Member
Joined
Dec 6, 2013
Professional Status
Licensed Appraiser
State
Nevada
Received a request to complete a 1004 Appraisal on a 4.54 acre parcel with SFR and several outbuildings, all situated on the 4.54 acres. When borrower purchased this parcel, he also purchased an adjoining vacant 4.19 acre parcel. The two parcels have separate APN's, separate addresses with the county, and were recorded under two separate documents with two distinct doc numbers. In discussing with another local appraiser, he advised that including this vacant parcel in the appraisal was not allowed under USPAP. Checking my USPAP booklet I can find no concrete reference to such....anyone out there experience this situation before? Thanks!
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Retired Appraiser
State
California
"USPAP Booklet?" lol

You're not going to find this sort of thing in the booklet. It's a highest and best use issue to be solved. The last sale is just that.,. the last sale. We don't appraise the contract, we appraise the property rights and contributory value of the improvements, if any.

Go to efanniemae.com and this issue is discussed. Use the search function.
 

Michigander

Senior Member
Joined
Oct 23, 2003
Professional Status
Certified Residential Appraiser
State
Michigan
Fannie?

B2-3-04, Special Property Eligibility Considerations (07/28/2015)
 

Michigan CG

Moderator
Staff member
Moderator
Joined
Nov 1, 2006
Professional Status
Certified General Appraiser
State
Michigan
For your vacant parcel answer the four questions of Highest and Best Use as vacant. Most likely you will find that the other appraiser is correct.
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
Received a request to complete a 1004 Appraisal on a 4.54 acre parcel with SFR and several outbuildings, all situated on the 4.54 acres. When borrower purchased this parcel, he also purchased an adjoining vacant 4.19 acre parcel. The two parcels have separate APN's, separate addresses with the county, and were recorded under two separate documents with two distinct doc numbers. In discussing with another local appraiser, he advised that including this vacant parcel in the appraisal was not allowed under USPAP. Checking my USPAP booklet I can find no concrete reference to such....anyone out there experience this situation before? Thanks!

In the real world--not some "pie-in-the-sky" theory--where you are appraising, if you owned both parcels (and, again, with your awareness of what's happening in the market), how would you market the 2 parcels in order to maximize the most probable highest value?
 

JTip

Elite Member
Joined
Oct 12, 2004
Professional Status
Certified Residential Appraiser
State
Pennsylvania
Checking my USPAP booklet I can find no concrete reference

You are looking at the wrong booklet.

Check page C-5 in M&S for concrete reference.

Seriously though, it's H&BU.
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
Received a request to complete a 1004 Appraisal on a 4.54 acre parcel with SFR
Appraise what you are requested to appraise and not adjacent properties you were not asked to appraise...So what that they own the parcel next to it? They are not borrowing money on that one are they?
 

Walter Kirk

Senior Member
Joined
Jun 24, 2003
Professional Status
Licensed Appraiser
State
New Jersey
What is the purpose of the appraisal? Does the client want the additional parcel included? Does the owner want the other parcel included?
 
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