Commercial Use in Residential Property

[ml2007]

Hello,
Wondering if I can get some of your thoughts. I am residential appraiser and inspected a single family home in R1 zoning. Found out, home owner is using it as a legal adult care center. No modifications to the home. Assignment type is SFR refi. Am I allowed to appraise it as a single family home or has to be appraised by a commercial appraiser? Thanks in advance.

 

[Fernando]

Have the home been modified with ramps, larger bathrooms, and other features for the immobile?

 

[glenn walker]

Your

Hello,
Wondering if I can get some of your thoughts. I am residential appraiser and inspected a single family home in R1 zoning. Found out, home owner is using it as a legal adult care center. No modifications to the home. Assignment type is SFR refi. Am I allowed to appraise it as a single family home or has to be appraised by a commercial appraiser? Thanks in advance.

You are still appraising a single family home and not appraisang the business and since there have been no modification to teh

Have the home been modified with ramps, larger bathrooms, and other features for the immobile?

Fernando the post says no modifications to home -With that being said its not a problem the appraiser is still appraising a SFR and not the business and a AG licenses is not required. In CA the City's and Counties issue temporary use permits. As the appraiser all I would do is mention the owner lives in it but operates a care facility . Most likley the lender already knows it based on the borrowers tax returns etc. And don't go down a rabbit trail of trying to find another comp with a facility it never works. hey ETHEL - I have two home offices in my house and the inside of my garage is a work shop does the appraiser need to be a AG ? NOPE- Its still a single family house

 

[George Hatch]

The occupancy goes with the occupant, not the realty. The license goes with the operator, not the realty. The question the appraiser needs to be asking themselves is what they're seeing in the sticks and bricks. Because if/when that business goes dark/vacant the realty is the only asset that a new buyer is going to be getting.

One of the reasons that small group homes are allowed under most R1 type zoning in Calif is because an operator can establish such a business in just about any typical SFR as long as they can meet the other requirements. They might be required to add an additional doorway or add fire sprinklers or such, but nothing that would make that property less marketable as an SFR.

It's when they start adding more bedrooms, exterior doors/ramps for each bedroom, additional baths, large communal dining spaces and commercial kitchens and secured access systems and such that the property is moving away from what the average SFR buyer would consider.

 

[George Hatch]

I just saw a narrative appraisal on a 3000sf SFR located up in NorCal where the CG had assumed the current occupancy was the primary search parameter and they ended up using sales located in a 45 mile radius even though they had other SFRs in the same size/age range within a mile selling for half as much. One of which is literally located 100 yards away from the subject property. There is no indication in the report that appraiser is even aware of those sales.

You don't want to be that guy individual.

 

[Fernando]

Homes I remembered using as a nursing home had modifications to the SFR.
If legal, I would think state requirements need to have ADA modifications.

 

[ml2007]

Your

You are still appraising a single family home and not appraisang the business and since there have been no modification to teh

Fernando the post says no modifications to home -With that being said its not a problem the appraiser is still appraising a SFR and not the business and a AG licenses is not required. In CA the City's and Counties issue temporary use permits. As the appraiser all I would do is mention the owner lives in it but operates a care facility . Most likley the lender already knows it based on the borrowers tax returns etc. And don't go down a rabbit trail of trying to find another comp with a facility it never works. hey ETHEL - I have two home offices in my house and the inside of my garage is a work shop does the appraiser need to be a AG ? NOPE- Its still a single family house

That's what I thought, thank you for clarification.

 

[Tom D]

most l&i departments will catch you doing something illegal, and will shut you down. so, i would have asked the home owner what they had to do to not get closed by l&i. probable not much. also depends on what part of the house is being used. mostly what i have seen is the basement being used for the owner's business.

 

[glenn walker]

I just saw a narrative appraisal on a 3000sf SFR located up in NorCal where the CG had assumed the current occupancy was the primary search parameter and they ended up using sales located in a 45 mile radius even though they had other SFRs in the same size/age range within a mile selling for half as much. One of which is literally located 100 yards away from the subject property. There is no indication in the report that appraiser is even aware of those sales.

You don't want to be that guy individual.

Take the crack pipe out of that appraisers mouth --Geez he has serious issues : )

 

[shrubberyvaluation]

Hello,
Wondering if I can get some of your thoughts. I am residential appraiser and inspected a single family home in R1 zoning. Found out, home owner is using it as a legal adult care center. No modifications to the home. Assignment type is SFR refi. Am I allowed to appraise it as a single family home or has to be appraised by a commercial appraiser? Thanks in advance.

If it is set up just like a SFR appraise it as such. If it has like 6-8 smaller bedrooms to cram in more people where a similar property would have 3-4 bedrooms there could be functional obsolescence.