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Historic Preservation Easements

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Turner2

Thread Starter
Freshman Member
Joined
Jun 13, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
Have you appraised a property with a Historical Preservation Easement (HPE) and if so, what is the process? How is the HPE evaluated and how does the HPE impact the subject's value overall? I am working in Washington, DC.:huh:
 
Joined
Jun 3, 2005
Professional Status
Certified Residential Appraiser
State
Colorado
Every locality deals with Historic Preservation in their own way. In Denver, we have Landmark Properties (National Register of Historic Places), Historic Preservation Districts, and Historic Neighborhoods.

Generally speaking, historic designation has very little direct impact on value -- the historic designation limits what can be done to the exterior, and puts obstacles in the path of (or prevents) demolition; but other than that, the owners are generally free to do whatever.

It's probably different in the District, but not so much so that you need to limit the report to comps that have the same designation.

Now, if the designation is because of an historic event at the property, that might be a different matter; but for architectural historic designations, in my experience it's not a big deal.

Historic designations and districts can have a positive effect on value (the halo effect) -- but generally, in my experience the market reacts to the property in much the same way it would if the designation were not present.

I hope that helps -- good luck!
 

Jill Kinnaird

Junior Member
Joined
Oct 6, 2005
Professional Status
Certified General Appraiser
State
Ohio
I'm with Charles. Not knowing the definition or specifics of an HPE I can only assume it works like our Historic Overlay Districts here in Cincinnati. The neighborhoods have a certain historic value, generally architectural, which have been designated to be 'preserved'. Most regulations pertain to exterior renovation/improvement. More often than not your comps are located in the same or similar districts and no adjustment is needed. Properties having historical significance, such as being on the underground railroad or where a president was born, are more difficult. I once appraised a lodge that was owned by a 'founding father' of a local county for his service in the Revolutionary War. Absolutely gorgeous! All stone with rolling hills, spring house, stone fencing, a two story stone barn. It was on the National Historic Register and I could find nothing to support any adjustment for its 'historical significance'.
 

Brad Ellis

Senior Member
Joined
Feb 7, 2006
Professional Status
Certified Residential Appraiser
State
California
Turner,

Each market will be quite different.

Charles says he sees little value differential in Denver. In Chicago the value differential from historic register status can be rather dramatic. Just all depends.

Most of them restrict only changes to the facade but you must research it. In Long Beach, CA they can and do restrict interior changes in some cases.

Brad
 
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