Duplex purchase will be half owner occupied/half tenant occupied

[Zoe]

Years ago, I did a Jewish Synagogue that was sold to COGIC.

I promise you cost approach would not have worked on that one. That thing would cost millions and millions and millions to reproduce today. That is how high the quality of construction was on the subject. Old school money in Memphis. Real old school money.

COGIC liked my appraisal. They were not my client. Banks will tell you if the place of worship liked your appraisal. Of course I met the preacher or whatever they are called of any place of worship I ever appraised.

 

[Zoe]

On cost approach, I wasn't doing reproduction cost. No way. I got by with replacement cost on Cost approach. Similar utility for current use. H&B use was place of worship. MV was value definition.

 

[Zoe]

Places of worship very rarely get foreclosed on. The H&B use can change, but very rare for a place of worship to be foreclosed on.

Let me put it to you this way. I have not experienced personally a place of worship being foreclosed on. I have seen H&B use change maybe a time or two.

Many times govt will step in before a place of worship can be foreclosed on. They will say can we or any private investor or another place of worship use this subject property?

You know damn well the local bank don't want to foreclose on the place of worship.

The local bank would hold that loan for eternity before they foreclosed on it. Til 'Hell freezes over" is how long the bank would hold the loan before they foreclosed on it.

 

[Tom D]

Do you all realize how many properties are left to the church from deceased members.

 

[sputnam]

That is risky. You do realize that. What if that user dies in a minute? what about dies in a second?

The risk is the Lenders to take. This is an appraiser's forum. BTW, value in use isn't about a particular user... it's about a particuler use.

 

[Sadie]

Dealing with a purchase that is currently a full duplex with both units being leased. One of the tenants is purchasing the property and the other side will remain as leased. When looking at comps for both the rental portion and the sales comparison, should I consider properties that have only 1 unit rented? My thought process is, only one side will be rented which the GRM will not be the same for a fully leased duplex vs one that has only one side leased. Additionally, if I report rents for a full duplex then it will appear as if the income should be more than what will actually be coming in.

Fannie has guidance on this for the income approach.--Also its like any other property you appraise. Its not who lives there, its what it is. Don't over think it.