Help on a "unique" property appraisal

[Appraisal Santa Fe]

I'm appraising a property known as "the spiral house" I think the name says it all. I'll try to post a pic later. Not a single straight line and not a normal curve anywhere. I had to do the sketch from a hand written sketch by the owner who is a contractor and has built the entire property himself.
The property construction is all top notch and of very good quality workmanship. It's HUGE, with two stories = 3000sq ft and a lower level (basement???) that is another 1500 sq ft that has a guest unit with kitchen, bath, living room and bedroom, plus another guest unit being built in the other half.
Basements are rare in this part of the country so no comps with basements. He has windows going down from the outside with stucco wall openings that allow for light to reach them down into the basement.

So, the second floor is nicely finished, the basement guest unit is finished, then there is the main floor which has an office and bedroom that are completely finished out but the main kitchen, bathroom, living room areas are unfinished. (all appliances are on site) Since he's doing all the work himself, I dont know how to approach this part of the house. How to figure a "cost to cure" and apply it to my report...

Any help is appreciated.


RC

 

[Mike Boyd]

Ask the contractor/owner how much to finish it. Double that estimate and then double it again.....would be one way. I would make my own estimate of cost and just one double. BUT, that has nothing to do with the uniqueness. The whole thing sounds like a nitemare.

 

[George Hatch]

This type of structure will probably have some functional obsolescence. The floorplan will probably include some inefficiencies and the costs will almost certainly be excessive relative to the market's reaction to the design/appeal. It will probably require a greater-than-average degree of maintenance and it most likely doesn't blend in well with its environment or the other properties with which it would compete in the market.

If there is an identifiable market segment in your area for modernistic designs you might research the historic relationships between those and conventional construction of comparable size/quality. I would think that if you could come up with prior sales of 4 or 5 such homes and run each of them up against the conventional "comps" from those time periods you could probably identify a trend in there somewhere. Whether the trend was for a discount, a premium or no real difference in value at all, you could then extend that demonstrated trend to your subject in its relation to recent sales activity of more conventional design.

 

[Jill Kinnaird]

Before you start putting the report together contact your client. Let them decide how they would like to proceed; 'as is' or 'subject to'. 'As is' report will entail cost to complete plus discounting for market reaction to an 'unfinished' house. The property will most probably need a 'cash type' buyer due to its condition so you'll have to discount further for the decline in available buyers. 'Subject to' will entail obtaining plans & specs, if they even exist. If it's truly unique, notify your client that typical guidelines will most certianly be exceeded. Notifying your client of 'odd ball' properties and situations prior to completing any work saves everyone's time and money. Especially if your client has no idea that the property isn't completed construction.

 

[Appraisal Santa Fe]

Fortunately it's a refi and not a sale. Owner has good credit and equity. Still
I'll do it "As Is" and get a number together to complete. Hope she flies, looks like I'll be writing a novel in the addendum on this one..

Client is aware of the unusual nature of the house

 

[Joker]

Client is aware of the unusual nature of the house

Call the client first. They may choose not to proceed with the loan. If they do want to make the loan, let them decide what their needs are ("as is" or "subject to") and provide the service that suits their needs.

After all, you need to call your client anyway to tell them that your fee has at least quadrupled.

 

[soaplag]

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[Appraisal Santa Fe]

Would it be too far fetched if I weighted the finished basement guest quarters against a small guest house?