GXX001 Not Invoked After Work Completed

[George Hatch]

Hard costs is labor+materials. Moreover, the pricing ranges count. There's almost a point of diminishing returns for upgrades, remodels and such. At that point the 2x costs factor starts to drop and if you take the overimprovement far enough you can actually lose money on the remodel. Not that I think $80k in costs for in a market where the median prices are below $400k is excessive but you wouldn't want to spend a whole lot more than that.

My initial guess when your remodel came up was $75k in hard costs, so that's why $80k seems reasonable for the property as it stands.

 

[shrubberyvaluation]

Total about 80k diy put into it. Large master bath shower with a herringbone pattern, 72in double sink vanity with mid century modern though out the baths. Remodeled one bathroom with vertical tiles same style, added a full bathroom downstairs same finish. New floors, new roof, new mini split / heat pump combos that are in each bedroom and large room, Added natural gas fireplace in the old log burning one and updated the surround, ACTUALLY finished the lower floor to the same grade as the first floor as before it was outdoor carpet and block walls. New kitchen, new floors on main level. New lights, new electrical throughout new electric box, added EV charger, and all are upper end finishes.

My main question comes from the exemption and the difference between the above and below grade areas are valued at. If there is no difference then I would think that the price per sqft referenced would be difference than whats shown.

@CGinMN That might be a good idea to adjust the value IF you think that there is a difference in value between above grade vs below grade pricing.

Regardless of how they report it they SHOULD be reflecting the market in their adjustments. Your house is 100% below grade and the appraiser did not use the exemption? So they reported 0 sf GLA and put everything in the below grade?

The real issue is if the appraiser adjusted based on how the market sees it, not necessarily what line its reported on.

Do you have a copy of the appraisal not using the exemption and showing 100% of the square feet as below grade and 0 sf of GLA?

I understand your concern is getting the highest value and not that the report is credible or not (except to a means to an end if it works in your favor).

 

[MoistMitten]

Regardless of how they report it they SHOULD be reflecting the market in their adjustments. Your house is 100% below grade and the appraiser did not use the exemption? So they reported 0 sf GLA and put everything in the below grade?

The real issue is if the appraiser adjusted based on how the market sees it, not necessarily what line its reported on.

Do you have a copy of the appraisal not using the exemption and showing 100% of the square feet as below grade and 0 sf of GLA?

I understand your concern is getting the highest value and not that the report is credible or not (except to a means to an end if it works in your favor).

No my goal is not the highest value possible only the most accurate representation of my situation. If the house is 1800sqft and meets the exemption requirements stated by the ARV then it would be considered in the same way. New appraisal does not do this and attributes a lesser value based on being below grade... which the whole house is below grade. So if thats the case the value would not be accurate since its 100% below grade meaning a much lower value should be applied in the event that the exemption isnt executed.

If they use the exemption then its all on the same line making it an 1800sqft 4b 3 bath ranch on a slab. This value seems like it would be higher. There are around 4 comps showing 560k or there about which are in the ball park. I just need to get all my options before submitting an ROV. If you think this is accurate I appreciate it, but if it could be more accurate please let me know!

 

[residentialguy]

The appraiser didn't use the exception... nice!

 

[shrubberyvaluation]

No my goal is not the highest value possible only the most accurate representation of my situation. If the house is 1800sqft and meets the exemption requirements stated by the ARV then it would be considered in the same way. New appraisal does not do this and attributes a lesser value based on being below grade... which the whole house is below grade. So if thats the case the value would not be accurate since its 100% below grade meaning a much lower value should be applied in the event that the exemption isnt executed.

If they use the exemption then its all on the same line making it an 1800sqft 4b 3 bath ranch on a slab. This value seems like it would be higher. There are around 4 comps showing 560k or there about which are in the ball park. I just need to get all my options before submitting an ROV. If you think this is accurate I appreciate it, but if it could be more accurate please let me know!

The valuation should be the same regardless of how the appraiser reports it. What matters is how people in your market view it. There isn't enough information to know if its accurate. If a property is 1 story 100% below grade I would personally use the exception. I'm a bit confused why its showing a basement of 650 sqft and 1150 SqFt GLA if its a 1 story property on a slab. 2 Questions, how did they get that if its 1 story and how did they get that if its 100% below grade and didn't use an exception.

 

[KHS445]

I don’t know anything about real estate values in that area as I am located 200+ miles to the northwest. Despite this being very small and shallow lake, I am very familiar with it. My grandparents had a cottage located 10 -15 lots south of your place, from around 1930 to 1968. My aunt built a cottage immediately to north in 1960+/- and a great uncle was just south of my grandfather‘s place. My dad spent many summers there and we visited for at least a week every summer. the one thing I remember is the clams on which you would cut your feet, so you had to wear shoes when you went swimming and then take them off when you got to the raft.

Their properties were located on Elm, where it meets Homewild. Last time I drove in there was in 2018 and my aunts former home was listed for sale by owner. Don’t know what color it is now, but from the time they built it until 2018 it was a red ranch. Doesn't help your situation, but fun for me to think about the time I spent swimming and fishing on that particular lake.

 

[MoistMitten]

I don’t know anything about real estate values in that area as I am located 200+ miles to the northwest. Despite this being very small and shallow lake, I am very familiar with it. My grandparents had a cottage located 10 -15 lots south of your place, from around 1930 to 1968. My aunt built a cottage immediately to north in 1960+/- and a great uncle was just south of my grandfather‘s place. My dad spent many summers there and we visited for at least a week every summer. the one thing I remember is the clams on which you would cut your feet, so you had to wear shoes when you went swimming and then take them off when you got to the raft.

Their properties were located on Elm, where it meets Homewild. Last time I drove in there was in 2018 and my aunts former home was listed for sale by owner. Don’t know what color it is now, but from the time they built it until 2018 it was a red ranch. Doesn't help your situation, but fun for me to think about the time I spent swimming and fishing on that particular lake.

Ill keep an eye out Im going out there today!

@shrubberyvaluation
The reason I think they did it is out of simplicity. If they were to use the exemption it would require dropping a few comps and replacing with more accurate ones. As they are viewing it as 1150 GLA with a finishes basement. If thats a basement the whole house is and it should be reported as 1800GLA right? Thats at least the logic I am following currently. Why they viewed the house as above grade when it is not is what confuses me so much.


@residentialguy
Any advice to counter to attempt to bring that exemption into play? I feel it would make the property more accurate to the rules.

 

[residentialguy]

That example (berm home) is clearly stated as a reason to invoke the exception.
You would have to get a good review appraiser to do it correctly to find out if the results came up with a different and more supported value. If that happens, then the first appraiser had a misleading appraisal, which is a USPAP and a possible criminal offense in many states.

 

[shrubberyvaluation]

The reason I think they did it is out of simplicity. If they were to use the exemption it would require dropping a few comps and replacing with more accurate ones. As they are viewing it as 1150 GLA with a finishes basement. If thats a basement the whole house is and it should be reported as 1800GLA right? Thats at least the logic I am following currently. Why they viewed the house as above grade when it is not is what confuses me so much.

It is hard for me to say without seeing the same information you have. What is this 650 Square feet? Is it underneath the 1150? Is it a portion of the house that is more below grade and the 1150 Square feet is partially below grade? Is the 650 Square Feet finished to a lesser quality than the rest of the house? If the house is 100% below grade I'm not understanding how these he is delineating between above and below grade when making the exception.

You can have something reported in different ways by the same appraiser but if the analysis is done correctly the valuation should be the same. I don't know how your market views your home. I'm assuming the sales selected as comps are not similarly 100% below grade. If there are none available I typically would look into the past or expand the range and try to find another similar house 100% below grade and see how it compares to sales in that area/time range (or if there is a prior sale of the subject how does it compare to other sales in that time period).

There are different qualities of appraisers (just like any other profession). Some lenders go for the cheapest (probably not the best quality) and some go for quality appraisers that they rely on. When there are limited or no sales of a major feature or major part of the property it becomes more complex and there will most likely be a wider opinion on market value. I have no idea if the first or second appraiser has a more credible report.

 

[MoistMitten]

It is hard for me to say without seeing the same information you have. What is this 650 Square feet? Is it underneath the 1150? Is it a portion of the house that is more below grade and the 1150 Square feet is partially below grade? Is the 650 Square Feet finished to a lesser quality than the rest of the house? If the house is 100% below grade I'm not understanding how these he is delineating between above and below grade when making the exception.

You can have something reported in different ways by the same appraiser but if the analysis is done correctly the valuation should be the same. I don't know how your market views your home. I'm assuming the sales selected as comps are not similarly 100% below grade. If there are none available I typically would look into the past or expand the range and try to find another similar house 100% below grade and see how it compares to sales in that area/time range (or if there is a prior sale of the subject how does it compare to other sales in that time period).

There are different qualities of appraisers (just like any other profession). Some lenders go for the cheapest (probably not the best quality) and some go for quality appraisers that they rely on. When there are limited or no sales of a major feature or major part of the property it becomes more complex and there will most likely be a wider opinion on market value. I have no idea if the first or second appraiser has a more credible report.

Yes the 650 is below the 1150 and both are below grade and finished to the exact same finish. I its 8.5 ft ceilings with a bathroom and a fireplace. I can only go back 18 months, but I might be able to drive around the area to find another though I do doubt that. Is the ROV sent back to the same appraiser? They seemed on the fence about using the exemption even though the initial ARV appraisal did.