House on Local/National Registry of Historical Places

[FeeSimple]

I'm appraising a house noted on the local and national registry of historical places.

It's an arms length purchase, and the value is supportable as is, without applying any value or adjustments considering its on the registry.

I checked and none of the comparables happen to also be on the 'list'.

A brief search revealed no viable comparable sales that have recently sold in the area that are also on the 'list'.
The house had typical market time for the neighborhood and received a typical 98% List/SalesPrice offer which was accepted. Thus I feel its a fair statement to say that being on the 'list' doesn't necessarily positively influence the subject property, notable for an appraisal, within the subjects market.

Could I potentially be in violation of ethics since I've never appraised a home on the 'list'?

Is there anything I specifically need address within the report?

Is this even a big deal? Just trying to protect myself.

 

[Michigan CG]

There are restrictions on what can be done to a property on the national register and it is my opinion you need to fully understand the restrictions. Local restrictions can be more than national requirements.

At a minimal you should discuss those restrictions and understand them.

 

[Terrel L. Shields]

Thus I feel its a fair statement to say that being on the 'list' doesn't necessarily positively influence the subject property, notable for an appraisal, within the subjects market.

Being listed in one thing, restoration is another. These two are "on the list" one sold last year...neither are worth a hill of beans extra.

 

[J Grant]

Every appraiser has to appraise a certain type of house for the first time...any appraiser practicing has to do that, how else could they ever expand their practice? Being that you know the area and that price range etc, and homes on the list are rare , imo you sound qualified.

As you noted, no extra was paid, the marketing time was similar to other homes. Talk about it in report, and that though being on a historical register might lend a certain pedigree, or prestige to a home, it did not affect the market value.

What is important about homes on the list is what was mentioned in another post, restoration or rebuilding usually has some rules/regs around them. Ask the homeowner directly, they usually know what they are, and/or if there is a source at this historical registrey you could call, or look it up on line.

Are other homes in area on this list, or just this one home? Sometimes pocket areas are historical for several blocks , other times it is just one house. Sometimes the taxes are a bit lower , other times not. The limiting of what can be done re remodeling is good news bad news..it maintains the historical character of the home or neighorhood, (if houses around subject are on a historical area list), while it may limit what could be built or changed on the house. No doubt the buyer liked the home as is and has no plans to remodel with a jacuzi or other features not allowed, so the limitation did not bother them. Some people may take pride in of the historical character, though not proud enough to pay extra for it....just do a bit of research, explain, then move on with the report. An older restored home sale is good, if avail. If you can't find another comp on historical reg, just explained they are scarce and rarely sold, therefore no recent comp sales found.

 

[Restrain]

Just because a home is n a registry does not add to value. A prime example is the Frank Lloyd Wright "Falling Waters" home. Famous architect, famous home. But needed a lot of structural work. I have done these over the years and found that the restrictions can actually adversely affect the value. Cannot update as it changes the "nature" of the home, local regs prohibit upgrading the old single-pane wood windows, you name it.

 

[The Warrior Monk]

Just because a home is n a registry does not add to value. A prime example is the Frank Lloyd Wright "Falling Waters" home. Famous architect, famous home. But needed a lot of structural work. I have done these over the years and found that the restrictions can actually adversely affect the value. Cannot update as it changes the "nature" of the home, local regs prohibit upgrading the old single-pane wood windows, you name it.

If a structure is on the registry and needs major renovations, it can actually adversely affect value. The most dramatic example I've seen was a home (in a downtown business district), in really bad condition, that needed about $1,000,00 worth of renovations in order to upgrade and conform to all the local building codes and historic regs. The value after renovation was estimated at $450,000.

As far as value-added by being on the registry, it's simply a function of local markets.

 

[Lobo Fan]

Quite often the process required before making any modifications to the structure can be quite onerous. There can usually be no changes to the exterior apperance or footprint. Even something as simple as upgrading the windows can be quite horrific.

 

[DWiley]

Information about the National Registry of Historic Places can be found at [url]http://www.nps.gov/nr/[/URL]

The FAQ section, in particular, has some good info about modifying a home that is listed.

[url]http://www.nps.gov/nr/FAQ.htm#modify[/URL]

 

[aalderman1]

I researched this at length for a project a couple of years ago. The national registry is completely voluntary and in no way binding to the property owner...UNTIL the owner takes tax credits to renovate/update/etc. the structure. At that point, the tax credits limit what the owner/new buyer can do to the property without penalties. However, it seems many owners are happy just to have the property on the registry thinking it somehow adds value and they never really consider taking the tax credits. As a previous person commented, the local agency that helped the owner get on the list can tell you if tax credits have been applied for.

 

[Restrain]

What the National Registry says and what local registrys say are two different things. One town here says that if the home is "historic", any updates have to conform with the original design, and, as mentioned above, can be extremely expensive, prohibitively so in many cases.