Enclosed patio-GLA?

[jmedina]

I am concluding an FHA assignment appraisal in which the subject has an enclosed patio attached to the home. No permits were provided to the appraiser. I'm a bit confused from what I have been hearing and reading. I attended an FHA class and the instructor said if it's not permitted, give it value or demolish the addition. The enclosed patio appears to have been constructed in a workman like manner, with the exception of a water stain on the ceiings. I can't seem to find any sales with an enclosed patio. Should I apply a nominal value? If I do, does this have to be included in the actual GLA of the building. Please advise. thx

 

[realbiz]

Separate value (nominal value), do not included in the GLA. But, the roof should be repaired. If they don't want to fix the roof, have it torn down. Do not go with no value, because it will cost someone to tear it down or fix. The lenders quick fix is usually "just do not give any value".

 

[Riick]

Enclosed porch patio is not GLA -- unless finish similar to balance of house and is heated.
Why are you questioning whether it was built w/o a permit?

 

[Pamela Crowley (Florida)]

Structure and finish must be same or superior quality to the main GLA structure.

I sure do wish ANSI Residential Standards were mandatory for beginning appraisal classes!!! And again prior to licensure and/or certification.

 

[RSW]

I took an ANSI class for CE several years ago. One of the best CE classes I have ever taken.

 

[DelMarValuations]

Pam,

Are you saying if a non-permitted addition is of similar or superior quality to the original structure, HUD will allow the square footage to be counted in the main GLA?

 

[ZZGAMAZZ]

Just chiming in without being asked: My mentor in SoCal was advised by his "FHA Contact" last week that to fail to include workmanlike/etc/etc areas into the GLA regardless of the permit status will result in automatic removal from the FHA panel. I cannot cite the source, although it is diametrically opposed to what I was taught.

And like the OP I recently attended a SoCal FHA seminar in which the instructor's posture on non-permitted additions to the GLA was: include the area in the GLA, and condition the report "subject to" either obtaining permits or demolishing the area. (Burbank mid-April possibly the same class). When asked whether the guise of FHA would shield an appraiser from liability, the instructor indicated that quite the opposite was true.

I addressed this issue with the Forum last week and received a thorough bashing for the elitism and arrogance of presuming that the appraiser can tell a property owner how to treat his real property ownership.

Thas why I don mind asking FHA questions ad nausem casue there appears to be quite a divergence of opinion..

 

[Farm Gal]

Delmar...

Depends on where you are and if the local ordinances can create a mandatory tear-down or a required permitting of the previously unpermitted area. That was buried in some mortgagee letter from the dark ages... You were not to value the addition if it was a liability or subject to police power removal!

Best to insure yoru situation is properly addressed on a case by case basis... get the information from the building/permitting authority and then get the name rank and serial number of your HUD HOC contact along with what time of day and from which phone youcalled them. for verification when they try to hang you later .... THAT gets written on the case file folkder or stapeled to the file arounde this office!

Keep in mind that there are still counties (even in CA) where building permits for certain additions or structures are not required to have a permit, or were grandfathered in depending on age, AFTER permitting was enforced to a higher degree than previously required. In some areas it is verifiable that somebody lost the paperwork but everybody KNOWS it is OK on that house...

HUD insures loans all over the country. The rules were written to address many areas and many styles of regulation. The much vaunted OIC some folks have to contend with gets a blank stare in some ordinances!

There are places in the state I am in, where you cross a county line and there is a sign on all the MAIN roads stating that permits ARE required.... as in 'the place you just left doesn't require no stinkin permits' at all!

 

[Mike Kennedy]

I am concluding an FHA assignment appraisal in which the subject has an enclosed patio attached to the home. No permits were provided to the appraiser. I'm a bit confused from what I have been hearing and reading. I attended an FHA class and the instructor said if it's not permitted, give it value or demolish the addition. The enclosed patio appears to have been constructed in a workman like manner, with the exception of a water stain on the ceiings. I can't seem to find any sales with an enclosed patio. Should I apply a nominal value? If I do, does this have to be included in the actual GLA of the building. Please advise. thx

"heated, finished, and insulated similar to the remainder of the first floor" = GLA.

Enclosed Patio is still a patio; no actives, contracts, closed sales with similar enclosure typically indicates no contributory value for the enclosure i.e. F.O.S.A. ........COMP to open patio / deck / enclosed porch if market indicated. Address as such in CA as F.O., recommend no adjustment in SCA UNLESS indicated by comparables. Adjustments must be supported.

"subject to obtaining permit to restore Building/Zoning/Use compliance with municipal ordinance".

 

[DelMarValuations]

Your first paragraph describes how I remember doing it in the mid to late 90s. Either you had a permit, had to obtain one or had to tear it down.

So now HUD is okay with counting a non-permitted area if it is similar or superior in quality and is customary in the local market (no ordinance to tear down)? This appears to oppose what ZZ was just taught.