condotel?

[Ray Miller]

If it is rented out and there is income, then it becomes an income property correct?

If there is a cental res system, maid service, nightly rental, I would think it would be classed as a condotel, would it not?

 

[piaford]

i posted my reply wrong . . . i meant to send it to you . . . look online at what i wrote - it's firs flight retreat!

 

[JRS at OBX]

If it is rented out and there is income, then it becomes an income property correct?

If there is a cental res system, maid service, nightly rental, I would think it would be classed as a condotel, would it not?

There isn't a central res system. The maid service is the same kind of service that comes with the weekly cottage rentals, it's probably not the type that will come in a fluff your pillows when you go out for lunch. Once you check out, they will come and clean up just like you rented a 10 bedroom oceanfront house for a week. I don't know about the nightly rental, that is a new one around here but I don't think it would qualify as a condotel just because of that.

 

[piaford]

These are supposed to get the CO next week - they are being sold as individual condos - they will be owned individually - so right now, it is unclear if one owner will own more than 30% of the units. The individuals who purchase these units have a choice of which vacation rental company they want to use - so really there is no central reservations system and ther is no lobby or front desk. As far as I know they don't have to rent these units at all - and typically, in this area, it is between the individual owner and the rental company if they will rent for less than one week or one weekend at a time - . . .. i don't think it fits enough of the criteria to be deemed a condotel.(?)

 

[piaford]

ok - well, that's what i think too - but a loan originator called me and was very concerned - i'll just include what i find out and explain explain explain with lots of good verbage and let the underwriters decide i guess!?!? is that what you would do?

 

[JRS at OBX]

That is what I would do. I wouldn't worry about it too much.

 

[Mztk1]

So how come they instruct the appraiser NOT to make the determination if it is a condotel?

I dunno.

The one I am appraising is an old hotel and nothing in it or about it has changed except that the rooms have been sold to individual owners (most now in foreclosure and/or for sale for about 1/3 what they paid for them) who must have them as part of a rental pool. I don't think there is any way around it being one, but I'm just the appraiser. Who am I to say?

 

[DJBanas]

Have you read the Fannie Mae letter on condotels? It gives a pretty good description and states that they are commercial.

 

[Dave Smith]

Fannie Mae on condo hotels found at:

http://www.allregs.com/efnma/index.asp?dv=0&id=a&ii=0&im=0&io=FNMA&ip=/&iq=0&iv=0&iw=0&iy=0&iz=0&fc=0&fk=_&fm=0&fs=0&fv=0&sd=/&sm=1&sp=FNMA&sq=_&st=_&sv=0&sx=/&sy=0&sz=0&t=0&tc=FNMA/annoc/n2006&td=0&ti=0&tm=0&to=FNMA&tw=0&tv=0&tq=0&tx=/&tp=FNMA/annoc/n2006/n06-12

 

[Lost Cause]

Boggles The Mind

So how come they instruct the appraiser NOT to make the determination if it is a condotel?

Excellent question!

How ridiculous is it to ask an appraiser not to identify what kind of property he/she is valuing? Do I even need to ask how they expect the appraiser to complete the assignment without identifying what kind of real estate is to be valued?

Landsafe's policy is contrary to USPAP, FIRREA, and common sense. It never ceases to amaze me what some companies will put in print, but this takes the cake.

Anyone following these instructions should keep an especially good workfile, because they're going be meeting with their state appraisal board pretty soon (well, maybe not all that soon, but no doubt sooner or later). I suspect the board will not be taking an appraiser's claim that he/she was only following instructions very seriously.