FHA Excess vs Surplus Land

[Terrel L. Shields]

Maybe I haven't had enough coffee this a.m. but why would a HC be necessary? Are they referring to the excess portion of a single, larger site? I don't see the need for HC in the OP's scenario, i.e., two separate parcels.

damifino...but FHA says so.

 

[Dublin ohio]

Maybe I haven't had enough coffee this a.m. but why would a HC be necessary? Are they referring to the excess portion of a single, larger site? I don't see the need for HC in the OP's scenario, i.e., two separate parcels.

Required Analysis and Reporting.
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. The Appraiser must include Surplus Land in the valuation. If the subject of an appraisal contains two or more legally conforming platted lots under one legal description and ownership, and the second vacant lot is capable of being divided and/or developed as a separate parcel where such a division will not result in a nonconformity in zoning regulations for the remaining improved lot, the second vacant lot is Excess Land. The value of the second lot must be excluded from the final value conclusion of the appraisal and the Appraiser must provide a value of only the principal site and improvements under a hypothetical condition

If in the OP's situation both parcels are on the same deed and under one legal description. FHA rules apply. I have seen it both ways in the OP's situation. Sometimes they will describe "lots A & B etc, etc." other times they will have them on the same deed but with separate legal descriptions.

 

[Cob]

Required Analysis and Reporting.
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. The Appraiser must include Surplus Land in the valuation. If the subject of an appraisal contains two or more legally conforming platted lots under one legal description and ownership, and the second vacant lot is capable of being divided and/or developed as a separate parcel where such a division will not result in a nonconformity in zoning regulations for the remaining improved lot, the second vacant lot is Excess Land. The value of the second lot must be excluded from the final value conclusion of the appraisal and the Appraiser must provide a value of only the principal site and improvements under a hypothetical condition

If in the OP's situation both parcels are on the same deed and under one legal description. FHA rules apply. I have seen it both ways in the OP's situation. Sometimes they will describe "lots A & B etc, etc." other times they will have them on the same deed but with separate legal descriptions.

From O.P.

******The dwelling is located on a separate parcel with 1.13 acres, and they are selling an additional lot with it, separate parcel number, same owners, and is 4.7 ac.******

 

[Dublin ohio]

From O.P.

******The dwelling is located on a separate parcel with 1.13 acres, and they are selling an additional lot with it, separate parcel number, same owners, and is 4.7 ac.******

But are they on the same deed

 

[sputnam]

But are they on the same deed

How many deeds they parcels are on doesn't dictate the nature of the appraisal, whether one is surplus or exceess, or the highest and best use of the property. It's not even much of a clue. It tells you that in the past, the parcels were purchased at the same time.

 

[Dublin ohio]

How many deeds they parcels are on doesn't dictate the nature of the appraisal, whether one is surplus or exceess, or the highest and best use of the property. It's not even much of a clue. It tells you that in the past, the parcels were purchased at the same time.

It does for FHA

 

[Mark K]

If the subject of an appraisal contains two or more legally conforming platted lots under one legal description and ownership.....,

The OP stated that they have individual parcel numbers. If they have individual parcel numbers, they have their own separate legal descriptions. They are not under one legal description. Both one one deed? Sure, it happens all the time.

You can have multiple parcels with separate legal desc. on one deed and they can be conveyed/sold individually.

 

[sputnam]

It does for FHA

Don't think so.

 

[Cob]

The OP stated that they have individual parcel numbers. If they have individual parcel numbers, they have their own separate legal descriptions. They are not under one legal description. Both one one deed? Sure, it happens all the time.

You can have multiple parcels with separate legal desc. on one deed and they can be conveyed/sold individually.

N/M

 

[Webbed Feet]

The contract of sale includes the adjacent 4. acre parcel, but since it is not necessary to support the subject improvement, which sits on 1.13 acres, the adjacent site is not included in the appraisal

I have no idea, of course, what min zoning is - what is it? If it is one acre, the 4.7 acre lot is not needed. If the zoning is 5 areas, then it is needed to support the improvement.

If the two separate sites are both each their own legal lot of record, then the zoning matter regarding "support" for a five acre minimum is no longer relevant. 1.13 acres could predate current zoning and hence be grandfathered in.