Code Violations Reported in Title Report ?

[ZZGAMAZZ]

A pending assignment is the purchase of 3 vacant parcels in unincorporated Riverside County.

[The AF often in the past indicated the perspective that appraisers aren't the code police.]

Preliminary interviews of County Planning, Building/Safety, and Code Enforcement revealed various code violations, e.g., a non-permitted inground pool, and several greenhouses that are legally-permissible but not legally-permitted.

Are code violations included in a Title Report?
Are code violations required to be remediated prior to a Cali purchase?
Can/should a purchase offer include the contingency for code violations to be resolved by the seller prior to the purchase?
If none of the violations are addressed in the RPA, would the failure to do so be included in the appraiser's analysis of the purchase docs?

[Of course I should have asked Code Enforcement. I will do so ASAP but betcha they won't say "yes" or "no." I also am awaiting response from Title.]

And.... I reviewed numerous prior AF threads but still foggy about the scenario that would prompt the appraiser to include all 3 contiguous properties in one rather than three appraisals...]

 

[glenn walker]

Yeah dig a hole.....lol

 

[Fernando]

I have similar situation where owner has violations.
I never encountered such a situation. Would lenders lend on property if there are violations?

 

[ZZGAMAZZ]

I have similar situation where owner has violations.
I never encountered such a situation. Would lenders lend on property if there are violations?

I dont normally inquire about code violations. I was visiting County Building/Safety that brought the violations to my attention. Google indicates that CA transfers are not affected, and that a prelim reports ownership rather than compliance. But now i am obliged to report what I know but want to avoid providing Consultant rather than appraisal services, having recently tried to better understand the appraiser's role in contested divorce assignments...

 

[Fernando]

In my case, the owner voluntarily told me the violations and the "squatters" in her in-law causing the problems.
In SF with rent control, it's difficult to evict a tenant. Best is to hire an attorney to follow every step in the law. It may take years and "shake down" settlement.
Don't know how I can consider this in valuation of this problematic property.
Owner may not see it but I foresee lawsuits to happen.

 

[ZZGAMAZZ]

In my case, the owner voluntarily told me the violations and the "squatters" in her in-law causing the problems.
In SF with rent control, it's difficult to evict a tenant. Best is to hire an attorney to follow every step in the law. It may take years and "shake down" settlement.
Don't know how I can consider this in valuation of this problematic property.
Owner may not see it but I foresee lawsuits to happen.

Great question. Marketability seems to be affected, although rent control might smooth over the distinction between lessee and squatter long as both pay rent??????

 

[Fernando]

In your case, you have the violations which can be corrected. Let lender know and they can decide if they want to do the loan.
With SF rent control, if tenant decides not to leave, it's not that easy to kick them out. If tenant is senior, they have special rights. Would a buyer willing to purchase a SFR with tenant who dictate the terms? Not sure if lender understands full ramifications if appraisal report doesn't discuss in full details of how rent control can affect occupancy of subject.

 

[KHS445]

As you know title commitments only cover the recorded history of the property. So, if any of the violations have resulted in a document such as a cease and desist order, an agreement of correction or some similar document has been filed then the recordings should be mentioned in the title commitment.

Now that you are aware of this information how does it impact your highest and best use analysis? Should you decide to ignore the information would you be guilty of preparing a less than creditable and/or misleading report?

 

[ZZGAMAZZ]

As you know title commitments only cover the recorded history of the property. So, if any of the violations have resulted in a document such as a cease and desist order, an agreement of correction or some similar document has been filed then the recordings should be mentioned in the title commitment.

Now that you are aware of this information how does it impact your highest and best use analysis? Should you decide to ignore the information would you be guilty of preparing a less than creditable and/or misleading report?

I won't ignore it. I will rrporrt it because I have been made aware of it. Unsure how if at all HBU will be affected, and any cost to cure the violations would be less than straightforward, i.e., say the greenhouses must either be permitted or demolished n removed, I "presume" the two cost estimates would differ considerably although I've never encountered a C2C process in which an appraiser must decide which alternative is most feasable. [BTW I haven't actually received an assignment yet, simply conducting due diligence for a potential client--that's why I'm concerned about the distinction between appraiser and consultant, although I'm comfortable that my eventualy result will be objective and credible.]

 

[sputnam]

You are the appraiser. Your job is to develop and report an opinion of value for the subject property. Everything else in your post is someone else's responsibility. Having said that, if you are aware of any adverse conditions, you include them in your appraisal report.