Duplex on a 1004?

[CANative]

Thanks Mike. A good example of zoning ordinances and city code being as clear as mud. Their definition of duplex is any group of two dwelling units. The code then appears to contradict the definition by making distinctions between duplexes, accessory apartments and accessory dwelling cottages.

 

[CANative]

Andy...

Take a look at what Fannie has named the 1025 form. It's in big bold letters at the top of page 1. Fannie doesn't call it a "multi-family report." Fannie calls it a "Small Residential INCOME Property Appraisal Report."

 

[JSmith43]

"Small Residential INCOME Property Appraisal Report."

Does it say up to a certain number of SF?

At some point it isn't a small income property any more

 

[CANative]

Some on this thread would go ballistic if I told them about the property I appraised on a 1004 that had a large house, a medium house, two little cottages and an office structure with a full bath and a microwave oven.

 

[Webbed Feet]

In my opinion using a 1004 for a duplex is difficult the form is really not suited for the assignment. I am not saying it can't be done but it is difficult and can be very confusing. Personally I would not do it.

For example how are you going to report the GLA, both units combined with 6 bedrooms and 4 baths, with 2 separate two car garages.

The same applies to the comparables.

Personally I think the use of the form for a duplex could and would lead to a misleading report, so I would not use it. But that is just my opinion.

Mr. Wyrick and All,

To be more correct, shall we ask how we intend to report GLA for a 2-4 unit income property on the 1004, when by definition it is not Gross Living Area (GLA), but rather Gross Building Area (GBA) as correctly labeled on the 1025 form? Of course this is ignoring that some dinkwad decided on the 03/2005 1025 form to call the footage of the total of four units GBA and then the footage of each individual unit GLA. When the old 1025 form never referenced GLA anywhere on it and everything was GBA.

Just another reason I generally agree with you.

Webbed.

 

[Steve Wyrick]

Webb Feet

Point well taken as to one of the reasons not to use the 1004 form for a duplex.

 

[Steve Wyrick]

Greg,

"My property is on over an acre, has a 2,000 sf 3/3 and a 1,200 sf 2/2. It's all legal, I can rent one or both units to whoever I want. No one would buy this as an income property. It would be foolish to report the appraisal on a 1025 and no appraiser ever has."

Question - is the 2000 sf unit and the 1200 sf unit attached or are they separated?

Being on a parcel over 1 acre and in your area, it almost sounds to me like you are describing a SFR with a mother-law unit or house. If that is the case then 1004 would suffice, since you could do the larger home as the primary residence and the small unit/home as an accessory unit, and do it in accordance with the guidelines anf procedures for a single family reisidential home.

 

[CANative]

The units are separated. And the reason I'm pretty sure that no appraiser has ever appraised my property on a 1025 is because I bought the property from a family who owned it since the 1950's and they bought it from the original family who obtained it in the 1880's. So I'm the third owner.

Yes Steve. That is exactly what it is. This is why I hijacked the thread and went off on a tagent about "duplex" versus "SFR w/accessory unit."

It seems to me to be a combination of design/appeal and income. Plain Jane attached units which have lesser appeal for an owner occupancy and can be purchased for an amount where the rents are within shooting range of covering the mortgage and expenses then it's a pretty easy decision to use the 1025 for lending purposes. It's also easy to call this a duplex.

Appraising units in urban and metro areas is no more difficult (although a little more time consuming) than appraisinger SFR's. In rural areas, appraising units for lenders can be an absolute nightmare.

That's why sometimes I hate appraising.

 

[Marcia Langley]

I agree with Greg that there are certain properties that are not clearly identifiable as being SFR with accessory versus two-family. If feel like those properties could be reported on either the 1004 or the 1025.

One criteria to consider is the subordinate nature of the second unit.

I might have some difficulty agreeing to use the 1004 for a building clearly built as a duplex (for example, a building with two identical units side by side in an urban setting.)

 

[Carnivore]

Greg,

The SFR with Accessory unit is a term created by Fannie Mae and other GSE's.

It is still a multi-family that is under land use a; legal use, illegal use or grandfathered. Income producing may be a factor.

Applying your logic one could report an appraisal on a 1004 for a tri-plex, quadraplex, apartment complex. Just so long as there are proper disclosures.

Which unit is the acccessory?


Allison,

I think you should be asking the client WHY they want this on a 1004.

The product going to the secondary market is a dodge and unacceptable answer from the client.