Dubious bathroom situation

[Lobo Fan]

I looked at a small SFR that has a pre-1976 trailer along side. There is a doorway between the LR of the stick built structure and the trailer. The problem is that there is no bathroom in the stick built portion. They have started to install one, with stud walls and some rough-in plumbing.

I am thinking of using a C2C to finish the bathroom and hauling off the trailer (which is in very poor condition). Not sure if to condition it upon the completion of the bathroom (which is the purpose of the refinance), or to go as-is and let the lender deal with it. Not sure if CB4 applies here.

What would you do?

 

[PropertyEconomics]

Lobo ... I would assume from your post that the "trailer" is not permanently affixed to the site. This would result in the "trailer" being personal property which I would not include in the final value estimate.
I dont see how you can appraise this residence without making it subject to installation of the bath. Without a bath, unless you have comparables similarly situated with no baths, I would almost think this property not marketable and it certainly wouldnt meet building code for safe and sanitary.
The issue you would have doing a cost to cure, is would it reflect the true value "as is" which may be very very limited at best.
What does your client say and what is your scope of work?

 

[Kevin A. Spellman]

I would appraise “As Is” with curable functional adjustments, cost to finish the bathroom and the cost to remove the trailer and close the doorway opening. Does the current condition of the home create market resistance? Would a typical buyer finish the bathroom and remove the trailer?

 

[Lobo Fan]

I think I agree PE, thanks for the quick response. I have not yet discussed with the client. I did not know that it was a contraption until I started measuring. The trailer is hidden from the street by a frame-stucco wall. Still trying to wrap my head around this one. My thoughts started with it being a manufactured home with a site built addition. But the age and foundation situation were not too good. It still has the tongue and wheels on it, and it is pretty old.

I think I will go with it being subject to a completed bathroom. I will likely never find another comp with a similar situation. Thanks for helping me clarify my thoughts on this.

 

[CANative]

LOL...


I had one just like that back in 2004. One room cabin with a trailer glued to the side and serving as the kitchen and bath.

 

[Kevin A. Spellman]

Like most properties that are not typical of the market, there are inadequacies and the owners of these properties typically “do not finish the work”. The applicant may not complete the bathroom, but could qualify for a loan with a value reflecting “As Is”. If this is a mortgage company assignment, they probably would deny, but community banks with a portfolio product would close the loan with an “As Is” value.

 

[KD247]

Same as any job; if it's possible (it probably is) to make reasonable assumptions regarding the marketability of the property, form an opinion of value. If you discover that the original scope of work is inappropriate for the assignment, request a scope of work modification from the client (which might involved increased fees or a paid cancellation of the assignment).

In addition to your opinion of value (and supporting comments involving marketability) clearly report to the client any health/safety issues, zoning and/or code violations, and any other problems that might disqualify this property from their loan program (irregular construction, lack of permanent bathroom, ongoing construction, etc.) Be sure to reference your cautions in bold, upper case type on both the first and second pages of the appraisal form. Cautions that are only stated in the addendum have a way of disappearing from the report.

 

[CURT VAN HOOSER]

What came first...the chicken or the egg? I lived in Yuma for 6 years. The snowbirds would flock in the winter months. They would buy properties with trailers on them then spend a bunch of money adding "Arizona Rooms." These rooms may be just a large enclosed patio or may be bedrooms,family rooms, baths, kitchen, or any combination in between or inclusive of. In Yuma it wouldn't be too hard to find comparable properties.

 

[CURT VAN HOOSER]

How do the property records describe the subject?

 

[Lobo Fan]

Our property records are very limited, but there is no indication of a personal property trailer. From the street it is disguised with a frame and stucco facade. I was measuring it before I got around the corner a realied what I had.

I think the approach I will take is the trailer is personal property so I am not going to give it any value. I will check with the proper officials tomorrow and try to get a clue as to permit status, etc. It may be possible that none of it was completed with with permits. I reallt doubt they got a CO with the only working bathroom being a travel trailer.

I have prepared the report subject to a functioning bathroom. I can hardly wait for the whiny LO call when this one hits the system.