Frm With Brick Veneer Vrs Cb With Veneer

[jeff samolinski]

Got a cal from local attorney late Friday afternoon after I had already consumed a few brewski's. Seems he has a client that purchased a frame home with brick veneer. The problem is that he specifically told the realtor and all parties involved that he did not want to buy any home that was frame because he did not want termite problems. Anyway, all of the information about the home he purchased indicated that it was a c.b. home with brick veneer. So realtor hires local appraiser who says there is no value difference between frame with brick veneer versus c.b. with brick veneer. Attorney wants to know my opinion whether appraiser is correct.

Just wondering if anyone has any thoughts about this issue. I know that it is market area specific as to whether there is any difference in value between the two but someone might have some advise of a general nature that may be of help. Please limit your ideas to the appraisal problem and not the obvious bind that the realtor is in for not disclosing etc......

The problem I see in taking this assignment is that I would have to find some darn good purtin-near exact duplicate sales of homes that are frame with veneer and that are c.b. with veneer to establish any difference in value perceived by the market not to mention I would have to practically interview at least every buyer in those transanctions to determine if there were any other motivations behind the sales etc... Seems like a big uphill battle to prove anything one way or another!!!

Only other thing I can think of is using Marshall Swift which says for very good quality 2000 s.f. masonry home with face brick costs $95.26 and same size and quality frame home with brick veneer is $86.07

 

[Travis McGee]

Sounds like you know how to do the assignment- it sounds time consmng, make sure if you take it you charge a lot for it! If they don't want to pay the fee upfront decline it. Who knows when it will get settled or what will happen.

 

[Sean Braudrick]

Did you say attorney?? I'll second the (large) fee upfront recommendation.... this is what I was told the only circumstance where it is allowable to accept an assignment from an attorney other than "pay at the door" is:

1. It's in writing
2. It's notorized
3. It's witnessed by no less than 3 non-attorneys!

But seriously, you know the scope of the assignment-- if you're willing and they're willing to pay your price - go for it

The funny thing is that your work will probably not be necessary for his litigation, if proof can be made that the home was misrepresented.

 

[Caterina Platt]

Jeff,

Just remember when you look at the MS info, cost does not equal value.

Aside from how to do the assignment, I suppose if it were me, (granted, I'm allegedly an industry professional of sorts, but...) were I concerned about a home I'm purchasing being of non-frame construction, I'd probably have done the knock on the wall test. Terribly quick, easy, cheap and low tech. Yes, I do suppose this would have been inconclusive if the walls had been furred out, but then I may have opted for a structural to satisfy my concerns, rather than relying on the 3 piece suit saleperson's knowledge.

Just my opinion, and it has no bearing on your assignment. I just can't wait until the day that some judge and jury wises up and properly assigns responsibility in these cases. As I state in my reports: The appraiser is not an expert in X, Y, & Z, if this is of concern, hire a professional in that field.

 

[Ted Martin]

My local buyers don't have xray vision and can't tell the difference between all brick, or brick veneer over whatever. They only buy the top 1/64 inch of finish anyway and really don't care what holds the pretty parts up.

Saying that I have worked in markets with serious ___________ (fill in the blank with termite, hurrican, wildfire, etc.) problems where they were concerned and would reject properties that were not considered immune to these local problems.

 

[Steve Owen]

It sounds to me like you have a good handle on the problem and how to solve it. Basically you try to find a lot of comps looking for those that are similar to your property for price range, design, and style (location, of course) and use them to prove whether or not there is a difference.

The Marshall Swift is a good place to start. I would definitely do a good solid cost approach for this problem. In my market, I have a feeling that there is a difference, with the all masonry house having higher value than the similar house that is brick veener. (I've never really had to do a formal study of this, which is why I said "feeling.") However, I believe that this difference is not as large, especially in older houses, as the difference in cost. So, in other words, as a previous poster noted, cost does not necessarily equal value. It is a good starting place however and may also help you prove just what the difference is. If there are a lot of all brick homes being built in your market and your subject is relatively new, the cost might possibly be just about equal to value. You can only find that out by working the problem.

Ditto on the large up-front fee. But, don't forget to add in a contingency fee in case you have to testify.

 

[Patrick Egger]

Jeff ...

If I read your post correct .... I think you need to go back to the client (the attorney) and get an understanding of what it is he wants to prove. It would seem to me, that the client wants to show that the buyer has received less than what he contracted for and therefore is entitled to compensation.

This is not a market value difference issue, but rather one of just compensation for the realtor mis-representing the property and the buyer getting less than what was expected and what they trusted the realtor to provide.

Proving that the subject is worth more, less or equal to a CB with brick would not seem to be the point and unless you have an abundance sales data that clearly indicates a difference, proving such would seem to be near impossible given the other variables of location, time, physical differences, age, etc.

If you had a $5000 difference, what would that prove? Giving the buyer $5,000 doesn't change the frame into a CB, not does it prevent potential termite damage which is why the buyer wanted the CB in the first place.

It would seem to me that the attorney must establish that the realtor knew that the buyer wanted CB vrs frame and represented the property as a CB and that there is a difference due to potential termite damage, construction soundness, etc. If that can be proven, the difference between the two is not the damage nor just compensation (although the buyer could elect to settle for the difference).

It depends on what the buyer wants as compensation as to which approach you may want to take. Assume the buyer wants a CB house, the attorney could take the position that the realtor should buy back the property and let the buyer find another and move at the realtors cost.

In just compensation, the damages vary and likely will exceed the difference in the two types of properties. If you ordered a Jag and the dealer sent a Chevy along with a check for the difference in price, I hardly think it would be equal and neither would the court.

I'd go back and have a long talk with the attorney, find out what the motivations are and get a better handle on the assignment scope. Give the attorney some feed back as well. At this point you could be doing research until you have some preliminary answers at which time the attorney may have several options which may or may not include an appraisal.

 

[Mountain Man]

The problem is that he specifically told the realtor and all parties involved that he did not want to buy any home that was frame because he did not want termite problems.

Good post from Patrick. I'm not sure that's the real reason, <_< CB homes can have termite problems too. Unless the flooring and walls are unfinished concrete, and the roof framing is of a non-wood material, termites can find plenty to eat up.

 

[Steve Wyrick]

Jeff,

You got a good handle on how to handle the assignment. Too market specific for me to address specifics other than to say; Charge the same hourly rate as the attorney and make sure that you have a very good understanding of the intent and scope of the assignment.

This does not appear to be a standard 1004 form either. Narrative report with lots of remarks, since you will probably be in court somewhere along the line.

Good luck,

 

[hal380]

Hi Jeff:

Another thought;

The buyer specifically stipulated that he did not want wood frame cus of termite concerns.

He now has a wood frame house.

Cost to cure? A competant termite inspection, A good soil treatment, followed by the sentricon (sp?) monitoring system. All this paid for by someone other than the buyer.

This avoids doing an appraisal which may be hard to defend, and will be less expensive for all concerned.

Regards

Hal