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Cost approach for a Codo Unit

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Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
I have a lender that wants a Cost approach completed for a fourth floor 3 bedroom Kitchenett, Livingroom, 2.5 bath, codotel unit.

This is a first for me. Where do you even start. I have a call into both my old mentors who have retired. No response yet from them.

Has anyone done a cost approach for a codo or codotel unit?
 
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Wendy

Senior Member
Joined
Feb 23, 2004
Professional Status
Certified Residential Appraiser
State
Florida
I would not touch a cost approach on that with the proverbial 10' pole.

Of course, I also don't do condo-tel units.
 

TJSum

Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
Land Value ??? Where is my ten foot pole ??? Sometimes you just have to say NO to UW.
 

Jerry Bone Jr

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Joined
Feb 23, 2004
Professional Status
Licensed Appraiser
State
Oregon
So you give them a cost for everything inside the studs. You could probably use the Segregated Cost Method found in the Marshall & Swift handbook.
The remainder is the "site value". Good luck.
 

TJSum

Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
So you give them a cost for everything inside the studs. You could probably use the Segregated Cost Method found in the Marshall & Swift handbook.
The remainder is the "site value". Good luck.

What about the common areas, the unit is on the fourth level, is it just hanging in the air or is there levels of support below it? You can not determine site value, common area value, the not touching with 10' pole applies...
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
I have a lender that wants a Cost approach completed for a fourth floor 3 bedroom Kitchenett, Livingroom, 2.5 bath, codotel unit.

This is a first for me. Where do you even start. I have a call into both my old mentors who have retired. No response yet from them.

Has anyone done a cost approach for a codo or codotel unit?

Tell the lender "no can do".

The lender may request, but you do not have to accept.
 

Chris Colston

Elite Member
Joined
Jul 24, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Cost? Not Income?

Ray are sure they want COST and not INCOME? Sounds strange to me. But then again, I, as a residential appraiser, knowing that Fannie Mae will not buy the paper, don't appraise condo-tel units. I let the commercial folks do 'em. m2: m2: m2:
 

Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Ray are sure they want COST and not INCOME? Sounds strange to me. But then again, I, as a residential appraiser, knowing that Fannie Mae will not buy the paper, don't appraise condo-tel units. I let the commercial folks do 'em. m2: m2: m2:


Doubled check that, they want Cost approach. I told them there was no way I could get that or even start to put a value using the cost approach.

I am sure it can be done, but it would take a CG/MAI/MBA-Phd type person.

I would bet dollars to donuts they want it for insurance reasons.
 
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