Homeowner's Estimate of Value

[Pamela Crowley (Florida)]

Received an order for a rural, small, old, waterfront house that I had done 08/2001 and came in at $215,000.

New order includes the HOs (girlfriend is a Realtor) 'suggestions' for comparable sales for the vacant land plus the comment: "These sales, when adjusted to subject, would appear to validate a riverfront value in the area at $2,500/front foot +/-.

Second page states: "Neighborhood Improvements: County purchased the 'boat ramp' property on this road and will complete a County Park there this year, considerably enhancing the entrance to neighborhood. Also, New homes constructed in past year: 1) nest door to boat ramp - 2) **** River - 3) **** River.

Pam, it would appear that a value, land + improvements, of 300K - 325K would be justifiable."

He should have completed the Appraisal himself! His 'vacant land' sales included other improvements that I will check out. New, much larger houses built after those people have owned the land with a cottage for many years are not comps for a 30 year old, 1320 SF concrete block cottage. I spent over 5 hours last night searching for ALL river front sales along this rural stretch..... we'll see.

I love the $/FF when comparing .2 acre and 2.6 acre parcels!!! Some are very swampy next to the river and some are on higher banks with glorious views. Some have bulkheads, expensive docks and other site improvements - some were overgrown and completely vacant. Lots and lots of stats to pull together.

How do the rest of you waterfront gurus put this info together and adjust for size vs front foot? All that I pulled to use are SF sites - 1 SFR.

 

[BigBlueGA]

Could be worse.. she could have not sent you anything and just cussed you when your value wasn't what she wanted..

 

[Pamela Crowley (Florida)]

She did that last year! :roll:

 

[Karl]

Waterviews, Waterfronts, a favorite of mine Don't get many actually don't get any now I'm out here. Properties on Rivers are no where near those on Lakes or Ocean. Had many in the past on Rivers after showing the flood maps, Documents from Corp of Engineers showing River Bank Corrosion, Home location on plat map Unable to Rebuild due to closeness to river or lot size increase in zoning specs, or in event of fire or natural disater. Well river propeties didn't get treated all that kindly. PAM besure to include a Alligator picture in your report if U don't get the value they want. I always included a Danger no swimming sign on my street scene. & the steep embankment going to the river

 

[Dave Smith]

Pamela:

I appraise quite a few shore front properties every year. Years ago, when there were a lot of vacant shore lot sales it was easy to use the front foot unit of value (price divided by lake frontage) to arrive at a value for the lot. We now have so few vacant shore lot sales that the front foot value approach doesn't work very well anymore, without first extracting the contributory value of the land from the comp sales you can find. That isn't a very accurate way to do it unless you know all there is to know about the comps and therein lies another problem. Getting good, accurate sales info. (see posts about MLS data, Realtors and their innacuracies).

Now I try to adjust for shore front site values based on my estimate of the overall contributory value of each of the shore front sites to the sale price of the comps. It isn't easy and I sometimes get arguments from propertiy owners or Realtors but no one else has any better data than I do so we usually end up in a standoff.

The following paragraph is my editable starting point in trying to explain, explain, explain to the UW. I seldom get a question or a call about site values from UWs so apparently they are OK with my approach.

I hope this post helps in some small way.

Lot (site) values in this area are influenced by a variety of factors, including size, physical characteristics, available municipal services and over all market appeal. It's usually not practical to attribute lot value differences solely to location or to size. Therefore, unless location was a particularly significant value factor, any lot value adjustments made in this report appear on the site line of the sales grid. In determining any value adjustments that may have been made the approximate net market values of the lots were used, exclusive of their building improvements. In other words, the site value adjustments reflect the differences in the estimated site values of the comps as compared to the subject.

 

[Verne Hebert]

I have done alot of waterfrontage over the past 10 years here. And I am finishing one on a river today. We still have vacant land sales here.

First question is how does the market perceive this purchase?

Here, it is a front footage value. It has always been on lakes; but on rivers only during the past 5 years or so--because the realtor began to sell it that way.

I measure two unit values for starters-site on a square footage basis and the front footage of the river. You will develop a range of sf value and a range of ff value. Find the sale with the most similar utility (size, and size and quality of frontage). Water frontage experience comes in here, to some degree, to determine the unit value selected. Now take the unit values and multiply them by the subject sf and ff--this will develop a range of value. Based upon the market's unit of purchase reconcile the range.

What you will find is: there is (nromally) a point of maximum land size to ff (in a particular area)-there will be continuing but diminishing contributory value beyond an "optimum" site size--and if you analysis sales through the size range (0.2 to 2.5) this will be evident.

Hope this helps. Good luck.