FHA excess/surplus land. Rural.

[Debra]

Greetings, I'd like to learn how to do FHA appraisals on properties with excess/surplus land. For example, right now I have an order request for FHA purchase for a dwelling with 21 acres on one deed/one tax parcel. How do you do these? At first glance, there are 3 possible comparable sales within 7 miles, and they all contain one acre or less. So, if we consider 20 acres that can be sold separately/excess land then how do you complete an appraisal on this in detail? Anyone have a sample appraisal I could look at? because I'm not finding a class on this? and I checked with a few appraiser friends locally and they have never done these either. I have so many questions. I think that in the grid you would show the dwelling and one acre. Then, just do the appraisal as usual except note that the excess 20 acres is not given value in the report as only one acre is needed for the subject dwelling. Do you make it subject - to the dwelling and one acre surveyed off? or? How does this work? Please be nice. lol. Thanks!

 

[alebrewer]

The amount of land necessary to support an improvement varies by market. There are some markets where a home on 100 acres may constitute a highest and best use. There are other markets where a 1 acre tract may include excess or surplus land. You're moving in the right direction by looking at the market to see what participants are doing. FHA requires any excess land to be excluded from the valuation component of the assignment. Therefore, if you determine the H&B use to be the improvement and, say 5 acres of land, there would be no requirement to have the other 95 acres surveyed off - simply that it be excluded from the valuation. Make sure you're in close contact with your client during this process, as you don't want to surprise them with an appraisal giving value to only 1 acre (or 5, or whatever you determine is necessary to support the improvement).

 

[J Grant]

Greetings, I'd like to learn how to do FHA appraisals on properties with excess/surplus land. For example, right now I have an order request for FHA purchase for a dwelling with 21 acres on one deed/one tax parcel. How do you do these? At first glance, there are 3 possible comparable sales within 7 miles, and they all contain one acre or less. So, if we consider 20 acres that can be sold separately/excess land then how do you complete an appraisal on this in detail? Anyone have a sample appraisal I could look at? because I'm not finding a class on this? and I checked with a few appraiser friends locally and they have never done these either. I have so many questions. I think that in the grid you would show the dwelling and one acre. Then, just do the appraisal as usual except note that the excess 20 acres is not given value in the report as only one acre is needed for the subject dwelling. Do you make it subject - to the dwelling and one acre surveyed off? or? How does this work? Please be nice. lol. Thanks!

It is easy to figure out if you read the FHA guidelines on excess land, ( which excludes any excess land from value,).

It is not subject to anything. The excess land is given no value for FHA purposes the end.

 

[TerryRohrer]

It is easy to figure out if you read the FHA guidelines on excess land, ( which excludes any excess land from value,).

It is not subject to anything. The excess land is given no value for FHA purposes the end.

Very helpful.

 

[Tom D]

You pretend it doesn't exist. You spell it out. A long time ago fannle had a 5 acre rule. It's all nonsrnse made up by some idiot savant in the organizatiin. As per FHA i only valued x amount of ground. Nothing more to do wit da other part of nvisible ground.

But i believe they have a more better private view than sitting on 1 acre.

 

[Terrel L. Shields]

How do you do these?

You value it by valuing the entire 21 acres comparing to other large parcels. The improvements you value separately. The fact that a tract can be subdivided does not mean it has to be divided into some future imaginary subdivision. Value the whole. You adjust the land value of the comps (which you value exactly the same way - the whole parcel) and adjust dollar for dollar.

If the house is on say a 1-5 acre tax parcel and the additional land is on a separate parcel, then each parcel is valued separately on the basis of sales of similar size. The question always to ask is which are you doing? A house (more than 50% of the value) with land or are you valuing a land tract (more than 50% of the value) that contains a house.

 

[Dublin ohio]

Page 823 and 824 of the 4000.1

 

[Dublin ohio]

Greetings, I'd like to learn how to do FHA appraisals on properties with excess/surplus land. For example, right now I have an order request for FHA purchase for a dwelling with 21 acres on one deed/one tax parcel. How do you do these? At first glance, there are 3 possible comparable sales within 7 miles, and they all contain one acre or less. So, if we consider 20 acres that can be sold separately/excess land then how do you complete an appraisal on this in detail? Anyone have a sample appraisal I could look at? because I'm not finding a class on this? and I checked with a few appraiser friends locally and they have never done these either. I have so many questions. I think that in the grid you would show the dwelling and one acre. Then, just do the appraisal as usual except note that the excess 20 acres is not given value in the report as only one acre is needed for the subject dwelling. Do you make it subject - to the dwelling and one acre surveyed off? or? How does this work? Please be nice. lol. Thanks!

Is there zoning. If there is what is the zoning requirements. Such as minimum frontage and lot size. That would determine the minimum required to support the subject improvements