Extreme Makover or Extreme Overimprovement?

[Restrain]

Wife just got a review request on a home - 5500 SF, VG quality, all the bells and whistles. However, home is 60 miles from anywhere, in an area of small frames and mobiles. ABSOLUTELY no comps in the entire county in the last year. Just about the same issues. Gonna be a LOT of notes on that one about superadequacys, locational issues, etc.

 

[Webbed Feet]

Ms Potts,

I wondered when one of those monstrosities would show up. It never seemed to occur to those show people that maybe they left these folks in a financing nightmare.

Ya got an over-improved a mixed use property there..... I wonder how many of these traditionally poor folks end up borrowing money because they find out they can't afford to heat and maintain these things.

Barry Dayton

 

[Couch Potato]

3 days is a non-issue

Among other things, I just can't get passed building a 5500 sf house in three days.

I have to wonder if the concrete slab foundation was dry when the walls started going up.

Joyce, the time for construction should not be an issue. Three days is plenty of time when the correct materials are used. I saw an 1600 SF house go up in one day (started as the sun was rising and finished late in the evening.) It looks as good today as it did when it was constructed.

With good planning, proper suppliers and sufficient labor; three days is more than enough time. With a job like that, extra labor is standing around looking for something to do (when is doesn't cost anything, you keep all the labor on site all day.) A city/county building inspector would have been there throughout construction (paid by the production crew; no waiting for inspections.) All the materials would be waiting in trucks near the site as the job began. Much too costly for normal construction, but very feasible for a TV production.

 

[Otis Key]

Any thoughts on this?

Have to agree with Barry Dayton - I think a lot of "little forethought" is placed into many of these situations. The owner is probably looking for a cash out refi to pay the utilities along, not to mention the insurance.

Can you imagine the amount of traffic coming up to that house, not to mention the kids always bringing over "the friends" to party and have a good afternoon because "we've got lots of space."

I think I'll pass and let you handle this one, if you get it. Keep an eye out for the mortgage recording - you know they won't take your fee - and then see if there's a way to get a copy of THAT appraisal. If you don't have grey hair now - it would probably make it all fall out, if not turn pure WHITE.

 

[Joyce Potts]

Update:

I'm waiting on a direct answer from the Seminole County Property Appraiser's office. I don't understand why this property has not yet been 'assessed'. Perhaps it's been totally designated as a non-profit? I don't know.

Very odd situation and I'm waiting for clarification of zoning, etc., before I jump into this one.

 

[Marcia Langley]

This is going to be interesting for you, Joyce. I'm glad you are letting us hear your progress.

I'm thinking it's really no problem if the house is a big overimprovement for the neighborhood, the owners are still better off than they were before.

The only danger for them is if the property gets appraised/encumbered for more than it's worth and they can't sell it for what they owe on it.

Aside from new refinancing, if they can sell it for more than what they could sell the old house, then they are comming out ahead, not to mention the interim enjoyment of it.

They would probably have to refinance right off the bat to pay capital gains. I read a story recently that the IRS is taxing that. The TV company is challenging the IRS but who knows how it will come out.

 

[BOB PADRICK]

One reason

Update:

I'm waiting on a direct answer from the Seminole County Property Appraiser's office. I don't understand why this property has not yet been 'assessed'. Perhaps it's been totally designated as a non-profit? I don't know.

Very odd situation and I'm waiting for clarification of zoning, etc., before I jump into this one.

may just be timing-that house was done in 2006 as I recall-which means the county won't place it on the tax rolls officially until 2007, and they generally have until early August to get it on the rolls (I worked for Orange County for nearly seven years-the taxing a year in arrears was a tough concept to explain).

The non-profit part would be interesting too-essentially it is a commercial, though non-taxable, use of the property, so you'd probably be better off comparing it to other professional offce/residential zoning properties than to residential-but then, you're talking about a commercial appraisal-$2000-10000 fees, anyone?

Cha-ching-though I'd still not like to do that...be a mess to try to calculate the publicity factor-how much is it worth to buy a house that has been on TV for all to see, inside and out?

 

[Lee Lansford]

Update:

I'm waiting on a direct answer from the Seminole County Property Appraiser's office. I don't understand why this property has not yet been 'assessed'. Perhaps it's been totally designated as a non-profit? I don't know.

Very odd situation and I'm waiting for clarification of zoning, etc., before I jump into this one.

Good thinking.

I tend to shy away from accepting assignments for which I have absolutely no idea (side-note: and, yes, my friends, I've been appraising for some time now) how I'll develop and communicate a credible opinion of value.

 

[Joyce Potts]

Update:

No answer from Dave Johnson's/Seminole County Property Appraiser's office office yet. That's unfortunate.

Guess where I'm going tomorrow.

 

[Deuce of Spades]

Glad it is you and not me! That is a major nightmare - hope you are being paid well.

I recently read an article that talked about a property up north that was the same type deal - struggling family with 10 kids under care, get new overimproved home. Now the problems begin, they have to have fund raisers for the family to pay the insurance and taxes on the property. Imagine that, the taxes went through the roof and now they can't afford to live there.

I think some of the 'TV' generostiy is short sighted; they gave them a new house that they can't afford to keep.