Has anyone appraised a property with a casita?

[Elliott]

During the go-go years I remember looking at new subdivisions in
Henderson and some had casitas and they were a nice amenity,
but I'd think from a builders perspective the cost is higher than
the main house (all those walls and a roof). In the current market
I'd think it would be one of the first amenities a builder would
cut out. Since I was looking at them as second homes, I, as a
potential buyer, considered them as part of the house living area,
but the main houses were large too, 2500+ SF, plus the casita.
The builders were charging mucho for them too.

 

[The Warrior Monk]

I'm not sure by your description what you mean. Do you mean a fully residence with a separate accessory structure? Or do you mean the the living quarters is separated in two; i.e., living/dining/kitchen in one building, and bedroom/baths in the other building?

 

[lcaappraisal]

Well....they are not common in large numbers in any market area around here. I appraised one other a couple of years ago and handled it the same way. Secondly, I got the GLA of all the comps casitas and deducted it and just had a seperate line item. Sad thing is, I was supplied with another appraisal on the property and that appraiser included it all in GLA which boosted the value to an extreme high after adjustments were made to the others. To each his own. I like consistency and will probably stick to ANSI.

 

[lcaappraisal]

What if you don't really have a market to compare it to. To see if they were recognizing the area the same or similar to the main GLA. My biggest issue was that the main house only had 2 bedrooms. Almost functional in my opinion. But that is part of the reason the builder had to include it to GLA because whos buying 2 bedroom houses...gotta make it 3. Right?!

 

[Mike Boyd]

I agree with Timothy. Remember, write your appraisal as if you had to defend it in court. There is no question that valueing the casita on a separate line would be more easily understood than by lumping it in to the square footage of the main house. You might even have to give it MORE value than the typical PSF adjustment.

 

[incognito]

Mr

PE writes:

With regard to Incognito's post ... ANSI is most probably a voluntary standard and not one that is mandatory. You do not have to adhere to it, unless the above conditions apply. As for me, I adhere to the standard but do not say so in my report.

I agree ANSI is a voluntary standard (unless otherwise noted in SCOPE or state law, as you suggest). When I said it was a standard, I really didn't mean it was THE standard. I was simply stating it may not be bad to adhere to if you have nothing else to hang your hat on...

Apex Mike wrote:

If it is built with the same or better quality as main GLA, is permitted and the market recognizes it as GLA, then you should give it full GLA value.

I think it is AT LEAST necessary to make an effort to determine if the market gives it "full GLA value". Mine happens to give it much more, and thus I feel it would be a USPAP violation to include it in living area (or adjust for it in a separate line at the same rate as your GLA adjustments). My feeling that USPAP trumps ANSI in any state boards mind! And, as the OP states, these things are common, so just use sales with the same amenity, and frankly, where you put it is going to be USPAP compliant. However, if you have one comp without this amenity, I believe it would be an error to include it on the GLA line UNLESS you have proven the market accepts it as contributing the same $/sq/ft/ as main living area.

 

[Tim Hicks (Texas)]

Well, I am a Texas appraiser and I would count it separately. If access to the casita is not through the main living area (exterior entry), then it should not be counted as GLA. It is not your typical SFR. There is a reason it is called a casita! Because it is not a part of the main living area. Any other logic is just wasteful logic and poor appraisal practice. Separate it and adjust it appropriately. You said you have sales with casitas, separate them and it will show what the casitas are worth. It does not matter what the builder says, the agent says or some appraiser in Arizona says! You are the appraiser! It does not matter if it costs the same, the agent and builder have a vested interest in the value being the same. Appraisers who say the market has no reaction to it are basing it on a series of poor appraisals that made it that way! If you were buying the property, would you think it was worth the same as a home with full access to the interior to all rooms compared to a bedroom and bath that only has access through some patio area?

Including the casita in living area is very bad advice. If you actually did that, you certainly would need to adjust for functional utility for poor access, but that is wrong way to approach the problem.

Appraisers who rationalize including it in GLA are just lying to themselves.

 

[Terrel L. Shields]

give it full GLA value

I would treat the GLA as the main house. The Casita (assuming the market recognizes them as "equal") would be adjusted at the same SF adjustment

Subject Casita
2000 SF 500 SF

Comp
1800 SF 400 SF

200 x $50 (mkt derived adjust) = 10,000 adjustment up
100 x $50 (again assumes mkt) = 5,000 adjustment up

comes out the same right?

If you called both GLA, then its 2500 SF vs 2200 SF = 300 x 50 = $15,000 adjust up

 

[The Sheriff]

Have to disagree with you Mike... I'm pulling the GLA out. There is a market difference in Arizona... whether or not you want to take the time to find a comparable property with a casita, well, that's on the appraiser and how diligent they conduct their research. Just because realtors aren't clued in enough that the GLA from a casita is not GLA, doesn't mean we have to fall into the same trap. When the typical buyer is purchasing a property, when looking for a 2,500 sq ft property, do they want 2,000 sq ft with a 500 sq ft casita inaccessible from the interior, or 2,500 sq ft of true livable GLA?

If I saw a review come over with the casita included in the overall GLA, I'm calling the appraiser out on it. The casita offers a contributory value to the property... replicate a cost approach with a casita... it does not come in at the same $/per sq ft as functional GLA.

This runs along the thinking of not breaking out basement GLA and then comparing the property to a single story. Very flawed and a significant reason why we have properties that have been significantly over valued in our market in AZ.

I recently did a purchase on a foreclosure property in Paradise Valley. Two years ago when the property was being purchased, the agent identified the property as having 4,000 sq ft. The property was actually 3,000 sq ft with an attached casita only accessible from the exterior. When reviewing sales on how the property sold for $2.2M, the sale never would have gone through if the appraiser had accounted for the casita correctly. The property would have sold in the $1.9M range. The sale on it recently was for $1.175M. If I had included the casita, the property would have comped out over $1.4M. In reality though, it appraised for $1.2M. Just my two cents...

 

[bart nathan]

Just put the casita sq ft at the bottom of the grid.
I would include the casita as GLA but not with the main living unit.


main GLA 2000 adj---

casita sqft 500 adj ---