Duplex + ADU should be considered as Triplex?

[gorillakimchi]

Hope everyone is having a good Sunday

My new assignment is a duplex income unit and the property owner recently added ADU (Permitted).

It's common in CA SFR + ADU but actually it's my first time to see Multiplex + ADU. I know more than 5 units are considered as a commercial building. Then, fourplex + ADU should be considered as Commercial building?

I checked zoning first and it shows LARD2 which allows duplex unit. Then, tried to search about multi family ADU rules but couldn't find it. (Only related to SFR)

Thankfully, when I was searching comps, I found a duplex unit with an ADU near the subject area!

But I am wondering what if there's was no comp? should I treat it as a triplex?

I just wanna know how other appraisers think about this.

** Can someone answer Fourplex + ADU = Commercial or still Residential ? **

Thank you

 

[Terrel L. Shields]

I would treat it as a duplex and comps I might use a duplex, the one with an ADU, and then use a triplex... I'd extract the value of the ADU as an adjustment for one, supported with the triplex, and weight all three equally unless the duplex with ADU is truly similar, then weight it.

 

[Charles West]

There is a beautifully maintained duplex on an oversized corner lot across the street from one of my favorite restaurants in the Arden Oaks area. They recently added a ADU at the wide wing access on the right-hand side, then extended a new driveway to accommodate the new unit. I was salivating at the thought of the cash flow.

 

[Dublin ohio]

Hope everyone is having a good Sunday

My new assignment is a duplex income unit and the property owner recently added ADU (Permitted).

It's common in CA SFR + ADU but actually it's my first time to see Multiplex + ADU. I know more than 5 units are considered as a commercial building. Then, fourplex + ADU should be considered as Commercial building?

I checked zoning first and it shows LARD2 which allows duplex unit. Then, tried to search about multi family ADU rules but couldn't find it. (Only related to SFR)

Thankfully, when I was searching comps, I found a duplex unit with an ADU near the subject area!

But I am wondering what if there's was no comp? should I treat it as a triplex?

I just wanna know how other appraisers think about this.

** Can someone answer Fourplex + ADU = Commercial or still Residential ? **

Thank you

I hope it's not for Fannie

 

[J Grant]

Hope everyone is having a good Sunday

My new assignment is a duplex income unit and the property owner recently added ADU (Permitted).

It's common in CA SFR + ADU but actually it's my first time to see Multiplex + ADU. I know more than 5 units are considered as a commercial building. Then, fourplex + ADU should be considered as Commercial building?

I checked zoning first and it shows LARD2 which allows duplex unit. Then, tried to search about multi family ADU rules but couldn't find it. (Only related to SFR)

Thankfully, when I was searching comps, I found a duplex unit with an ADU near the subject area!

But I am wondering what if there's was no comp? should I treat it as a triplex?

I just wanna know how other appraisers think about this.

** Can someone answer Fourplex + ADU = Commercial or still Residential ? **

Thank you

I am not in Cali, but will offer my perspective -
Property is supposed to be valued at is HBU, and a component of HBU is what is legally permissible

So if your subject is in zoning that ONLY permits/allows a maximum build of a duplex plus ADU, then that limits what your subject can legally be - a duplex plus ADU - it can not legally be a triplex of the zoning does not permit a triplex .

The value aspect can only come after you define what your subject is - which you are in the process of doing.

You fortunately have a duplex plus an ADU for a comp. you can bracket it with additional duplex comps and triplex comps.

 

[gorillakimchi]

I am not in Cali, but will offer my perspective -
Property is supposed to be valued at is HBU, and a component of HBU is what is legally permissible

So if your subject is in zoning that ONLY permits/allows a maximum build of a duplex plus ADU, then that limits what your subject can legally be - a duplex plus ADU - it can not legally be a triplex of the zoning does not permit a triplex .

The value aspect can only come after you define what your subject is - which you are in the process of doing.

You fortunately have a duplex plus an ADU for a comp. you can bracket it with additional duplex comps and triplex comps.

This a good guideline for me. I saw a posting a few days ago regarding Effective date of appraisal can be changed since the appraiser found a better comp after inspection. Most of appraisers answered it can't be changed due to its nature. Similarly, as you advised "Property is supposed to be valued at is HBU, and a component of HBU is what is legally permissible" I agree with your opinion and I will find comps based on duplex.

 

[gorillakimchi]

I would treat it as a duplex and comps I might use a duplex, the one with an ADU, and then use a triplex... I'd extract the value of the ADU as an adjustment for one, supported with the triplex, and weight all three equally unless the duplex with ADU is truly similar, then weight it.

Oh... it's somewhere between duplex & triplex. Good mix & match option I think. Thank you sir

 

[gorillakimchi]

There is a beautifully maintained duplex on an oversized corner lot across the street from one of my favorite restaurants in the Arden Oaks area. They recently added a ADU at the wide wing access on the right-hand side, then extended a new driveway to accommodate the new unit. I was salivating at the thought of the cash flow.

They know what to do

 

[J Grant]

This a good guideline for me. I saw a posting a few days ago regarding Effective date of appraisal can be changed since the appraiser found a better comp after inspection. Most of appraisers answered it can't be changed due to its nature. Similarly, as you advised "Property is supposed to be valued at is HBU, and a component of HBU is what is legally permissible" I agree with your opinion and I will find comps based on duplex.

Imo you can throw in one triplex comp if need be.

 

[sputnam]

A lot of the reason that market participants want to call it an ADU and a lot of the reason that appraiser go along with that is..... they don't want to either pay the higher fee for a multifamily appraisal or they don't want to learn how to do a multi-family appraisal. No matter how much spin you put on it... an SFR with an ADU is a two dwelling property. A duplex with an ADU is a three unit property.