FHA/combined Lots/excess Land/highest And Best Use

[BRCJR]

From the link posted: The Appraiser must include the highest and best use analysis in the appraisal report to support the Appraiser’s conclusion of the existence of Excess Land.

Highest and Best Use in this scenario would be for two separate parcels if I am understanding the original post correctly.

I tend to agree. That is what it was before the inheritance......the passing of an individual has no influence on H&BU as far as I know. The inheritor basically did a boundary line adjustment dissolving the inherited parcel. Assuming that boundary line could be reversed takes you back to the original two parcels. I will add there must be demand for the front parcel for it to be a separate H&BU and to adjust the boundary, again.

 

[Terrel L. Shields]

could be split with an easement to access the rear parcel

That easement does not exist.

what constitutes excess land to be excluded

This lot is surplus to the property.

So you are over thinking this.

Exactly.

Its land is worth what 5 acres is worth, not what 2 acres + 3 acres is worth.

 

[Mr Rex]

Reading is fundamental. Understanding is imperative. Open eyes and open brain...its right there in writing WTF?

 

[Amy Perkins]

If it's worth more as two lots and it's allowed, you need to check the box that the lender doesn't want you to check. The subject is not at it's highest and best use. You can state that it is one parcel and for the purposes of the report which is a refinance transaction, the interim use as one parcel will be valued. Note that the parcel was two separate parcels, but was joined into one parcel. This is where I like to add a comment regarding unauthorized use of the appraisal and that the value is at least the interim amount. I always worry they will sell it too cheap. Also, call your client and let them know you are going to check the box because they might just pay you a trip fee. Most clients will ask you to call if the property is not the highest and best use. It's not really a huge risk since the bank would have to release the other parcel, but banks don't like that box checked because some properties can't be rebuilt if destroyed.

 

[Mr Rex]

It's not 2 lots.