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Certified Residential/commercial/industrial Zoned Assignment

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Charliegrl

Freshman Member
Joined
Jul 14, 2016
Professional Status
Certified Residential Appraiser
State
Florida
I am a state certified appraiser in FL. I received an assignment for a property that is zoned commercial/industrial. It currently is used as a SFR. The assignment is for the current use. May I complete the assignment? It is NOT for a federally funded mortgage.
 

Howard Klahr

Senior Member
Joined
Oct 4, 2004
Professional Status
Certified General Appraiser
State
Florida
It currently is used as a SFR
That does not mean that is the highest and best use of the property

The assignment is for the current use
Is the assignment for the market value? If so, the current use may not represent the market value

May I complete the assignment? It is NOT for a federally funded mortgage
The answer is it depends ... Florida limits certified residential appraisers to 1 - 4 family properties regardless of whether it is an FRT or not. Therefore you'd need to resolve the highest and best use issue. If highest and best use supports a 1 - 4 family residential property then, yes, it falls under your scope of practice. If not, then no, at least not without assistance.

The challenge here is one of competency, in that you'd need to demonstrate sufficient competency to perform the highest and best use analysis related to the commercial aspects even if the the conclusion is residential.

If you need/want help and decide to move forward, contact me before accepting the assignment and I'd be happy to assist.
 

Michigan CG

Moderator
Staff member
Moderator
Joined
Nov 1, 2006
Professional Status
Certified General Appraiser
State
Michigan
I am a state certified appraiser in FL. I received an assignment for a property that is zoned commercial/industrial. It currently is used as a SFR. The assignment is for the current use. May I complete the assignment? It is NOT for a federally funded mortgage.

Just yesterday I completed an assignment where the subject was a single-family home located in an Industrial zoned area. My Highest and Best Use section of my report was five pages long and the residential use is no longer allowed for THIS house because the improvements were not used for residential for over one year. I found five comparable properties that sold where houses were in place at the time of sale and all five houses were torn down after the sale. What does this say about Highest and Best Use?

I seriously doubt you want to get involved in this, you would need to have land sales of commercial industrial land to do the Highest and Best Use summary and I am guessing they are not willing to pay a $2,500 fee for this.
 

Charliegrl

Freshman Member
Joined
Jul 14, 2016
Professional Status
Certified Residential Appraiser
State
Florida
Just yesterday I completed an assignment where the subject was a single-family home located in an Industrial zoned area. My Highest and Best Use section of my report was five pages long and the residential use is no longer allowed for THIS house because the improvements were not used for residential for over one year. I found five comparable properties that sold where houses were in place at the time of sale and all five houses were torn down after the sale. What does this say about Highest and Best Use?

I seriously doubt you want to get involved in this, you would need to have land sales of commercial industrial land to do the Highest and Best Use summary and I am guessing they are not willing to pay a $2,500 fee for this.
Exactly! That is the direction I am heading..."Just say no"!
 

ucbruin

Elite Member
Joined
Mar 11, 2014
Professional Status
Certified Residential Appraiser
State
Massachusetts
Just yesterday I completed an assignment where the subject was a single-family home located in an Industrial zoned area. My Highest and Best Use section of my report was five pages long and the residential use is no longer allowed for THIS house because the improvements were not used for residential for over one year. I found five comparable properties that sold where houses were in place at the time of sale and all five houses were torn down after the sale. What does this say about Highest and Best Use?

I seriously doubt you want to get involved in this, you would need to have land sales of commercial industrial land to do the Highest and Best Use summary and I am guessing they are not willing to pay a $2,500 fee for this.


"What does this say about Highest and Best Use?"

Wouldn't that depend on what your "verification" gleaned from your conversations with the agent/sellers/buyers?????




:peace:
 
Last edited:
D

Deleted member 130081

Guest
I am not a General, so I turn down all properties commercially zoned. Each time I consider taking one on, I get stuck on the highest and best use. Could I educate myself better to "feel" competent making a highest and best use judgement on commercially zoned property? Maybe. Though I am not sure it would right to do so. For me, if I have to stop and question my ability, I take that as a good sign to let someone else handle it.
 

Slappy

Sophomore Member
Joined
Mar 2, 2010
Professional Status
Certified Residential Appraiser
State
California
Run away from that mess. I once turned down a similar assignment. The buyers subsequently turned the SFR into a retail business. I bet the lender who funded a residential loan on that property was not pleased.
 

JTip

Elite Member
Joined
Oct 12, 2004
Professional Status
Certified Residential Appraiser
State
Pennsylvania
so I turn down all properties commercially zoned.

H&BU as VACANT.

Vacant.

Vacant.

Vacant.
 

jturner01

Junior Member
Joined
May 13, 2008
Professional Status
Certified Residential Appraiser
State
Florida
That does not mean that is the highest and best use of the property


Is the assignment for the market value? If so, the current use may not represent the market value


The answer is it depends ... Florida limits certified residential appraisers to 1 - 4 family properties regardless of whether it is an FRT or not. Therefore you'd need to resolve the highest and best use issue. If highest and best use supports a 1 - 4 family residential property then, yes, it falls under your scope of practice. If not, then no, at least not without assistance.

The challenge here is one of competency, in that you'd need to demonstrate sufficient competency to perform the highest and best use analysis related to the commercial aspects even if the the conclusion is residential.

If you need/want help and decide to move forward, contact me before accepting the assignment and I'd be happy to assist.


Howard,

I am currently working on.... I mean I stopped working on (after I did the inspection) a home that is zoned Agricultural/residential, however the home owners have a tree farm/nursery. I have completed the inspection (did not want to have to go back to the property), but as soon as I pulled up and saw the trees, I just "knew" I would not be completing the report. Should I have this re-assigned? I was in the middle of doing this, but then decided to make sure, just in case I am looking at this the wrong way.

Anyone else want to chime in, I would greatly appreciate it!
 
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