Common Area Of Duplex

[Pekejake]

I have a duplex that I have not inspected yet. The attic is finished and heated with headroom above the second floor and is considered a common area according to the homeowner. Harrisons guide states the rules established by fannie mae are acceptable to freddie mac for meausring gba. and are substantially the same as the rules for calculating GLA, however some appraisers interpret them to mean that common hallways/areas are not included in the gba.. Okay if its 5 ft or higher and more than 50% of this giant room is greater than 7 ft (according to ansi) than I would include as GBA.. But since this common area does not belong to either of the units and its common space, than obviously my total GBA will conflict with the total finished areas of both units added together?? Never did a duplex with a large common area like this... Any help would be appreciated.. Thanks

 

[wyecoyote]

Consider using a GLA for adjustments to the unit and perhaps either a SF or line adjustment for the difference for the area. Depending upon what your market is telling you.

 

[Pekejake]

For the sales comparison grid I can do... However with rental comparisions this will obviously be excluded from the individual units.. Should i list as amentity?

 

[Kate]

I can't wait to hear the rest of the responses. I have not run into this yet as an appraiser. However my duplex is very similar. I have a 500SF finished room in my attached barn. It is attached by a finished bridge that connects the common area of the house to the third floor of the barn (still attached in my mind even though you can walk under the bridge). We are only using it as storage now but someday it will be my office. The town will not allow a studio apartment, so it is not that valuable, but it was a selling point to us so I would think it is worth something.

On all the appraisals I have ever had on my duplex, no one has ever mentioned this space or given it a penny of value.

 

[wyecoyote]

For the sales comparison grid I can do... However with rental comparisions this will obviously be excluded from the individual units.. Should i list as amentity?

You can list as an amenity and adjust there. Again if an adjustment is warranted in the market. You have to be able to prove an adjustment.

On all the appraisals I have ever had on my duplex, no one has ever mentioned this space or given it a penny of value.

Could be there is no value disernable from the market.

 

[Kate]

True. But there aren't many duplexs that have a space like that (not attached to either unit, a separate finished space that is not rentable). Not in my market that I have seen. There are single family houses that have loft spaces above their garage, but I haven't seen any duplex's that have an extra space like that. Perhaps it's a functional obsolescence issue. The floor plan is odd and doesn't flow. So instead of dealing with that issue and giving the space value, it is easier to completely ignore the space all together????

 

[wyecoyote]

So instead of dealing with that issue and giving the space value, it is easier to completely ignore the space all together????

Not completely ignore it. Depends on what it use and utility. Could be functionaly obsolete. If there truly is no market comparison that can be abstracted from a market analysis. Hypothetically speaking there are a couple ways to deal with it. One note it in the report and state there is no supporting market data to provide an adjustment. Two note there is no direct market data to support an adjustment however, treat it as an amenity similar to say some other area of a duplex that provides additional feature or amenity such as another outbuilding, storage, common wash room or other. Three note there is no market data to support an adjustment and rely upon the cost approach for an adjustment.

Though personally I would note it and depending upon the use and utility of the area would consider it from there. Sounds like it is part of the barn so perhaps considering it a portion of the barn and finished loft area of the barn maybe what it was considered as.

 

[Mike Garrett RAA]

I, personally, would adjust for common areas on a separate line; however, I have seen appraisals where the appraiser just divided the common area between the two units. More common in duplex properties than duplex. What ever you do, explain, explain, explain. As far as the comps.....you must make some assumptions and/or verify the data with the agents involved.