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Highway Noise Adjustment

Based on my description: Do you think Highway Noise Affects Value?

  • No

    Votes: 0 0.0%
  • Yes 0 to 10%

    Votes: 0 0.0%
  • Yes 11 to 20%

    Votes: 0 0.0%
  • Yes, more than 20%

    Votes: 0 0.0%

  • Total voters
    0
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Chuck

Thread Starter
Freshman Member
Joined
Mar 7, 2002
Professional Status
Certified General Appraiser
State
New Jersey
Hi Everyone:

I am doing an appraisal for some homeowners who were told that a highway noise barrier was to be constructed behind their homes which back onto a 16 lane interstate highway. Later they found out that the walls are not going to be built and are suing for loss of value. Anyone have any paired sales of residential properties where one backs onto a highway and the other is far removed from the highway?

Thanks for looking.

Chuck
[email protected]
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
New subdivision, homes backing onto a new freeway bypass. Loss in value of 10% due to noise vs. homes 1 block away. This is in the Dallas area. [email protected].
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
Chuck:

My answer is none of the above: 'it depends'!

Noise or rather the PERCEPTION of 'Noise detrimental to value' is often significantly modified by many different individual factors: elevation changes or curves in the roadway and the elevation/topography of the house as compared to the roadway appear to be the most significant.

In a fairly recent discussion of this problem it was observed that it is a very dangerous thing to ASSUME a detrimental condition. You might want to start with interviews of homebuyers in the immediate area who were looking at other homes and determine IF they considered other homes (and where those homes were) prior to making the final decision to buy homes backing the highway.

In many areas it makes NO difference, in some moderate, and in others greater factors: You may want to specify from which geographic area you are working and then be VEEERY careful about assumptions drawn between disparate markets even from within your general marketing area. a wall installed on the other side of the highway may have more impact on the homewners noise levels than the presence or lack there of on thier own! Benefits of a highway in the rear yard may include no noisy/nosy neigbor to the rea, a larger (or smaller) yard, etc etc.

If the opposition does their homework, they may eat you for lunch, and still have room for a snack after.
 

Dan/Fla

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Florida
Verify information, I done a few of these, I alway try to find a sale with the same problem, like on same side of street where the highway would have the same effect, if out of date I use for a 4 or 5 comp. however sometimes I have to go back further, then I work up adjustment, buit keep in my files, though if warrented I will adjust adjusted value for time, but usally this is not needed. One time a while back I made an adjustment without supporting it for myself and a Underwriter called me on it, I was able to support it but it was a panic time.
 

Dee Dee

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
This is a pet peeve of mine....homeowners who buy cheaply into homes next to freeways who then expect my tax money to either up the value of their homes by building noise barriers or think they are due some kind of compensation for something they KNEW was there to begin with.
Unless these homeowners recently bought into their homes based on promises made by the highway department or a developer, they're the only ones to blame.
Make sure you get paid immediately for your work!
 
B

Bemis Pownall

Guest
What loss in value?
They knew the problem(traffic noise) and I asume the property was priced accordingly.
They can sell it and buy a home without the traffic noise.
Case Closed
 
B

Bemis Pownall

Guest
If your homeowners dont have this statement of the barrier wall being built in writting, old MLS printout or whatever..i wish them luck.
why didnt they check it out further? why dont they take some responsibility?

Flip side borrowers get scewed by lender promises everyday, I wish they'd(borrowers) sue lenders more often..
Oh well
 

Charlotte Dixon

Senior Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Delaware
It seems like in Delaware, subdivisions that are close to busy Route 1 Bypass sell for MORE money. I'm amazed that one subdivision has ranch and contemporary style homes which sell for over $200,000 and they're selling like hot cakes! Not only can you hear the traffic, but you can see them wizzing by. Another subdivision backs up to the exit ramp of DE Rte 1 and the rumble strip noice is tremendous. On a final inspection I went to, the borrowers were starting to move in. I casually asked what they liked about that subdivision. They said 'quick access to Rte. 1'.....they work in Philadelphia. Luckily I used comps from that subdivision. I would have thought it was an inferior location. So, I don't even think about making an adjustment for that type of location anymore.
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
The proper way to identify impacted property is to pick an area along the freeway and survey gross property values based on distance from the Highway. This seems to work best if you go to a $/SF as there is a tendency among builders to build smaller, lower cost homes nearest a highway. You want to identify the price/unit and days on market where possible. Alternatively, a rent survey of the area could identify rent losses associated with noisy houses.

You data should show the unit price and rents increases the further from the I -state you get and the DOM decreases. I would say you need at least 100 sales to be statistically significant. The DOM argument can go a long way in that homeowners may not be able to sell within a typical marketing time.

If this is heading to court, there is no shortcut to doing the survey. The Hwy dept will certainly do it, as they can spend public money defending themselves and you will be hoisted on your own petard by a very professional and better-paid-than-you appraiser who will point out this is the way to do it, and you are doing it wrong.
 

Chuck

Thread Starter
Freshman Member
Joined
Mar 7, 2002
Professional Status
Certified General Appraiser
State
New Jersey
Thanks for the responses. Both the public and private one's have been helpful and thought provoking. It is interesting to me, how many people had opinions on whether the homeowners were defrauded by the broker and the developer. I don't think I gave any facts one way or the other. All of the homeowners on the same side of the street filed suit within months of moving in. I don't view it as the role of the appraiser to decide whether fraud was committed, but left for the lawyers and the jury. It is my role to determine the difference, if any, between a house backing onto the 16 lanes interstate with and without a noise barrier.

I have found federal highway studies, which suggest that for every decibel of noise above a standard, a residential property loses 1/2 percent in value.


Chuck
 
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