Fannie Mae and "Multiple Parcels"

[J Grant]

Inasmuch as I occasionally perform appraisals on multiples Ima let you in on a little tidbit which you might not have considered. When the valuation scenarios in an assignment include providing a MV opinion for multiples under bulk sale conditions most appraisers include prominent labeling to that effect as well as commentary that the conclusion shouldn't be confused with the mv for each. Moreover, most such assignments do include the retail values for each unit as a *necessary* interim step towards getting the MV of the group.

For the most part that isn't happening in the Fannie assignments we're discussing in this thread.

Well I've appraised multiple properties too and do the same as you said above. And imo, for conforming res use with a lot and a house it is not that hard, just time consuming step by step.

I appraised last year a house on a lot and one block over, it's deeded deep water with a dock strip lot included in sale and the value. ( per Glenn's post not build able lot ) I've appraied multi million dollar homes in Palm Beach where a strip of land across street added a million $ in value ( also non build able lot . ) And I've appraised several which were plain vanilla residential improvement and adjacent vacant lot.

All of them passed review the WF ones were jumbo loans and get scrutinized and also a second appraisal. On all of the including plain vanilla residential I developed an opinion of value and HBU of the strip lot or vacant lot and its contributory value was discussed.

I bet a lot of the mud throwers here never even did this type of appraisal.

 

[J Grant]

You should get off the idea that it's personalities that drive consensus. You get flack because of your habit of riding the obviously sinking ship all the way to the bottom. I never disagree with you because of who you are. I do disagree with some of your opinions, though; just the same as you disagree with some of mine.

It is personality in a few specific cases, there is no one consensus, it is always the same few throwing shade. Leave it at that. I appreciate your posts greatly and you are an example of how people should handle themselves, stick to the topic and not go off on rants and lectures.

 

[Lee Lansford]

You should get off the idea that it's personalities that drive consensus. You get flack because of your habit of riding the obviously sinking ship all the way to the bottom. I never disagree with you because of who you are. I do disagree with some of your opinions, though; just the same as you disagree with some of mine.

No, it's the same problem and the same application and the same principle that's involved. Only the property types are different. That's how you test the reasoning - by seeing how well it holds up when you swap out some of the variables of the equation.

George, I admire your effort, but, frankly, she just doesn't get it.

 

[Lee Lansford]

Inasmuch as I occasionally perform appraisals on multiples Ima let you in on a little tidbit which you might not have considered. When the valuation scenarios in an assignment include providing a MV opinion for multiples under bulk sale conditions most appraisers include prominent labeling to that effect as well as commentary that the conclusion shouldn't be confused with the mv for each. Moreover, most such assignments do include the retail values for each unit as a *necessary* interim step towards getting the MV of the group.

For the most part that isn't happening in the Fannie assignments we're discussing in this thread.

Again, you understand, I know. But, she does not understand Bulk Value and doesn't grasp how it is that MV is so linked with H&BU. Bless you for your perseverance and patience.

 

[J Grant]

George, I admire your effort, but, frankly, she just doesn't get it.

I dn't get it? You are the one who said an opinion of market value could not be opined for the two properties together, and actually George's answer of ( yes ) they can was in response to my question (rhetorical) to him, follow our exchange back from when I asked, . He agreed with me, follow the exchange.

His example of mixed use commercial was a different appraisal problem but yes the concept is the same. Which I agreed with that in my next exchange with him. Am sure Mich CG is loving this now, this toxic crap. It should be banned from the board but that would mean he could not do it and his doing it as moderator encourages others. This board is toxic when it goes in this direction of tag team bullying, re you appealing to Stone to get him inboard that i am incompetent , Unbelievable. Nothing against him, he can form his own opinion, but it is the fact that you are doing it and have done it throughout this thread. Which surprised me since I never encountered it before from you.

I have lost all respect for you in this thread, because you will not admit the your initial stance was wrong, your stance was a single MV opinion could not be made for two properties conveyed together, then later the gem that the only use was for the lot is a green space. Instead of honestly dealing with, it to deflect attention away from it you lectured people and attacked their competence.

 

[J Grant]

Again, you understand, I know. But, she does not understand Bulk Value and doesn't grasp how it is that MV is so linked with H&BU. Bless you for your perseverance and patience.

Getting past this ( 10% of his posts are on topic, the rest throw shade...)

Back to topic: The so called "bulk value" assuming a discount may not be the case with many of these sales. Or at least do not pre determine outcome by assuming that. Look at what the market actually does with these sales. Talk to local area RE agents esp those that specialize in lots and scour MLS, there may not be many combo lot and house sales but they exist.

People incorrectly assume a "bulk value", as if the seller "had" to sell both together. In reality though that is not often the case. IF a seller has to sell both together, they might take a significant discount. But being that most sellers list these properties as either or, they might give a marginal discount selling both to one party but that might be it. Why would they take a loss on either property, if they don't have to?

Most MLS listings are on MLS in both categories, listed under land and under houses for sale.

In the land section the listing : "!0,000 sf build able lot available, list price Y $, or can purchase with house next door offered at X $ and create your dream estate"

In the house section the listing: : "2000 sf ranch house with pool, list price X$, or can purchase with adjoining 10,000 sf lot offered at Y $, and create your dream estate"

They rarely have a combined price in the ads and if they do it is a very slight discount. Owners of these properties won't give away the house just to get the land sold, and unless they are cash strapped, they won't give away the land just to get it sold with the house. They own the lot free and clear very often, so they'll hold it rather than take a loss on it. Of course every market and situation is different, reporting what I often see here.

 

[George Hatch]

Citing the few as being typical doesn't work. If/when these transactions are that common you shouldn't have any trouble finding all your comps in the same configuration, then you don't have to fret about what the typical buyer would do.

In Andrei's example I would have told the seller to sell each parcel separately and in exchange for me advising them more competently than their broker they could slip me 25% of the difference between the contributory of the extra parcel to the house vs its value when sold individually. I could use a new car.

 

[J Grant]

Citing the few as being typical doesn't work.

The "few" cited would represent whatever is typical for your market. Goes without saying. What do you see in your market? How are these properties listed? What marketing times are they sold in?


Are owners of these properties listing the two as a combo only, and willing to take a loss/keep them on the MLS for extended time in order to sell them together or are they listing them as a column A or clumn B menu, each listed for sale separate with an option to combine ? Spend some time on your MLS and get back to us/ ask agents in area.

We get our information from the market, not rote predetermined they always sell for a steep discount" bulk value" or other pronouncements.

And back to MV definition and MV why would a typically motivated well informed owner of a house and adjoining lot behave like an idiot and take a big loss just to sell them together? When
either one could be sold separately at retail price? Do sellers take a discount, and if so by how much less than typical list to sell discount ratio to sell them together? Ask area agents, track sale vs listing histories.

 

[Carnivore]

172. VALUE IN USE REQUEST FROM FEDERALLY REGULATED LENDER
Question: My client, a federally insured financial institution, has asked me to provide a value in use appraisal instead of a market value appraisal. May I do this?
Response: USPAP does not dictate the use of any specific type or definition of value. The type and definition of value must be appropriate for the intended use and intended users. For federally related transactions, federally insured financial institutions require an opinion of market value, as defined by regulations. Therefore, if you provide a value in use, you may also have to provide a market value, depending on the intended use.

Round and round we go.....

I think you meant 176 soon to expire USPAP.

#188 New USPAP

Not trying to be nit picky, Just trying to make it easier for ALL the readers, especially any new one coming on board

 

[George Hatch]

The "few" cited would represent whatever is typical for your market. Goes without saying. What do you see in your market? How are these properties listed? What marketing times are they sold in?


Are owners of these properties listing the two as a combo only, and willing to take a loss/keep them on the MLS for extended time in order to sell them together or are they listing them as a column A or clumn B menu, each listed for sale separate with an option to combine ? Spend some time on your MLS and get back to us/ ask agents in area.

We get our information from the market, not rote predetermined they always sell for a steep discount" bulk value" or other pronouncements.

And back to MV definition and MV why would a typically motivated well informed owner of a house and adjoining lot behave like an idiot and take a big loss just to sell them together? When
either one could be sold separately at retail price? Do sellers take a discount, and if so by how much less than typical list to sell discount ratio to sell them together? Ask area agents, track sale vs listing histories.

So quantify the examples you find and see how that goes:


"I was able to identify 10 such transactions in this area over the last 5 years. Of these, x sold at pricing equivalent to the house on a single oversized lot and y sold at higher pricing, apparently due to the potential for additional development."

Citing one or two is weak, but citing a pattern will make for a stronger case. Right?