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Handling High-end Specifics

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Julia Young

Sophomore Member
Joined
Feb 23, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
High-end extras. Often these have small acreages. Some could almost be two appraisals in one, land and home, particularly around developing areas in large cities. Some with more goodies than Graceland, they are the 5-8000 sq.ft. properties on 2-4 acres. There may be a stable, car barn, or other buildings. One had a 7 car detached heated/cooled garage constructed specifically for an antique car collection. These are not "income" facilities per se. They are wealthy folk's add-ons, over and beyond a guest house and pool thing. I have a little trouble classifying specifics for adjustments when comparing to other high-end PUD types located in gated communities with loads of amenities, golf courses, etc. versus someone's dream home on 4 acres with their stable, gazebo, lake, dock, etc. Seems like apples and oranges. I was wondering how some of you adjust for the 'extras.' Had a subject last week that had a built-in refrigerator in the bathroom and one of the comps had a fountain and waterfall. unseen of course.

I would like a little info on resources or guidelines.
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
takes a lot of research to locate similar sales and see if they are applicable. If you have sales from more developed areas that still reflect that condition, I suspect you can feel safe to take at least as much off as the market indicates for them. In the absence of additional supporting evidence from similar market areas, I would hesitate to do anything more than round up my adjustment however. Otherwise, you can poll other appraisers or Realtors..(very time consuming) and ask them how much they would discount a certain condition. Polls can be a basis for adjustments. It beats nothing.
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Fortunately my Million Dollar Plus houses do not come with all of those bells and whistles. They are one million plus mainly because they are located on water which gives them very high site values (Form $3500 to $9000 per front foot). The last one I did recently, there were only 13 possible relevant comps. The one before that, some 15 miles away had the same 13 possible comps. Where there has been an additional structure or finished bonus room, I call it guest quarters and use the cost approach to generate a contributory value due to lack of similar accoutrement's in the market.

However, I am doing a Complete Appraisal with Summary Reporting so I tend not to get into the high end minutia listing feature after feature as though I were trying to impress the homeowner. They don't need impressing by me. They've already wasted more money than I'll see in a long time just building these monuments to themselves.
 

Blue1

Elite Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
California
I usually try to find similar comparables. They don't have to have the same specific high end amenities but should depict the same "wealthy folks add ons" found in your subject property. This precludes making large or numerous adjustments for these items. Remember, SOME of these amenities are particularly personal in nature and may have little or no market re-capture value. (over-built so to speak)

Sometimes I may find only 1 comparable that is even close and in that case, the amenity adjustment (if any) is quite conservative with an explanation that it is not generally found in the market. Sometimes a comment to the effect "The heated and cooled horse barn with a studio and office and kitchen is worthy of mention but, for purposes of this report is given a conservative adjustment do to its insignificant market recapture value." Or something along those lines.......Hope this helps.....Good luck....
 
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