Help !!!! appraisal for a succession HOME ON LEASED LAND

[Jannifer Romano-Watts]

This one is new to me. I'm not sure how to approach itl. Older home on leased land. (1 acre) Land is leased year to year. The appraisal is for a succession. Any ideas or suggestions. Would this be an approach anyone would take. No comparables of homes on leased land available. Use sales in the area and deduct the value of the land in market approach. Use no value for land in cost approach. Determine cost of moving home within say 10 miles and use this cost as an adjustment for functional depreciation in cost approach and functional utility in market approach. Property rights appraised would be only fee simple or feesimple and leasehold????? Any help with this would be greatly appreciated.

Thanks,

Jannifer
Louisiana

 

[Anonymous]

Run away from this one. If you can't find any comparables there isn't a market for this type of personal property.

 

[Steve Owen]

Jennifer:

Your approach seems reasonable to me. Although I don't have any specific experience with the particular type of problem you are trying to solve, I have used similar methods to those you describe in the past.

My question, before agreeing with Walt, would be what is the purpose and function of the appraisal. This would not be an appropriate 2nd mortgage job, but it might be okay to do it this way for tax estate valuation. There are many appropriate reasons why someone might need a market value opinion for a property where no clearly identifiable market can be found and verified.

You seem competent and your method seems reasonable. Be sure to write lots of comments and keep good documentation in your files. Also, be sure to charge an appropriate fee for all the extra work. Good luck.