House straddles 2 towns

[aspinfo]

I am a homeowner with a difficult "comp" situation. My home sits 90% on the land of a very small town, where my home is likely to be the largest and most upgraded home in the town. This town has not other direct comps for my home, with total square feet within 20% of mine.

My home is 5,000 square feet above ground, 1.75 acres of land, and built in 1999. Unfortunately, in my home town, the closest homes in size are 3,000 square foot homes that have had partial basement finishes with suspended ceilings to make them into close to 4,000 feet, so the disparity in home size is quite dramatic.

My home was also built by a home builder as his own home, so each and every room of the house is loaded with the type of upgrades that just would not compare to the typical home. As I say this, I'm sure your first thought is I'm just another homeowner that feels his home is special, but several brokers have commented in the same way, that my home might be most suitable for a professional athlete in my local area that would appreciate the bells and whistles and related costs.

As the other 10% of my land is on a neighboring town, I had hoped to find it reasonable, that without any true comps in my own home town for a house that is really outside the box, that in such a situation, looking at homes that do in fact exist in the neighboring town could be used.

I would expect that reasonable adjustments for disparity in school rankings in the state, tax rates, and median home prices, if any, would be appropriate, and I'm not expecting otherwise.

I do pay taxes in the neighboring town for the pro-rata portion of land that extends into that town, so as the taxpaying homeowner, I was hoping that in such a circumstance, those taxes paid might yield this one benefit to me, that appraisers could determine,

"The subject home has no reasonable comps in the subject town, and within a 2 mile radius in the neighboring town, more recent and more appropriate comps do exist, so having no other comp homes to go by, the homes in the neighboring town will be taken into consideration, albeit, with adjustments that might be deemed appropriate for any disparities in the two towns that are found."

I am hoping to get responses from your professional experiences so that brokers can begin to ascertain an appropriate value for my home because currently, they are at a loss as where to begin.

I have left out specifics, but if anyone would like to look at the specifics, I'm happy to communicate directly. Thank you.

 

[Lisle]

I am hoping to get responses from your professional experiences so that brokers can begin to ascertain an appropriate value for my home because currently, they are at a loss as where to begin.

Sounds like a complex assignment. Your best bet is to get a very experienced appraiser in your area with an excellent reputation . The fee will be money very well spent.

 

[Mile High Trout]

I would expect that reasonable adjustments for disparity in school rankings in the state, tax rates, and median home prices, if any, would be appropriate, and I'm not expecting otherwise.

I do pay taxes in the neighboring town for the pro-rata portion of land that extends into that town, so as the taxpaying homeowner, I was hoping that in such a circumstance, those taxes paid might yield this one benefit to me, that appraisers could determine,

A small proportional tax savings probably won't make it to the appraisal report.

And neither will any perceived or actual differences in school rankings, etc. It's all about the surrounding market, which theoretically already reflects those natural price adjustments, through the actions of other sellers and buyers in the area. So if schools are a big deal and drive higher home prices, your comparable sales will already reflect that. Not every home buyer is motivated that way, so individual adjustments for those considerations are usually not applied.

Despite having a superior home, you're still usually limited by the surrounding market place. Peak highest and best appraisals are challenging, but also somewhat simplistic in nature. You're likely to only be limited by your surrounding real estate market.

 

[Mile High Trout]

Mod - move to ask an appraiser section please.

 

[VolcanoLvr]

OP....are you absolutely certain that your property boundary between the two towns actually cuts through your site, and does not follow the property boundary lines?

Seems like an odd situation. But since MA was founded 200 years ago, maybe this is not so uncommon.

It could be that your site is actually comprised of two separate legal lots, which has been assembled into one site, with the dividing line between them the jurisdiction boundary.

 

[aspinfo]

I'm absolutely certain that a triangular area in the right rear corner is in the next town and that town certainly collects taxes from me. Not much, but they do send bills!

 

[Mile High Trout]

Is this the property where they forgot to gerrymander the lines around? lol. These scenarios were more common in the past, when they drew lines down maps, and then made those boundaries real. Over time, the process of gerrymandering straightened out many individual property boundary issues, although it certainly did not do any good for consistent county lines. Built before the final state line was drawn?

But a little tax here or there. It's a market constant. Everyone gets taxed, and the assumption is general similarity with market sales comparisons.

Original poster also stated her reps may be uncertain how to price the property.

So the standard move in that scenario is to get a pre listing appraisal report. You get the appraiser of your or your agents choosing out there, and run a standard appraisal. When you order the appraisal, you get a lot more latitude to talk to the appraiser, because you're the client. In a sales scenario, that pre listing appraisal cannot be used to fund a loan, so it's yours, and it's mostly worthless to any buyer. But it has a high value to you and the agent, so you can direct a complex sale, with the proper tools. There are many forms of value, and it's possible your property, if unique enough, may require more than just the market approach to value. Only an experienced appraiser who can solve the appraisal problem you pose, can tell you that. It's a personal deal, where you've got to contact local to get moving with it. An appraiser could not provide specific advice, without adequate data access which only local appraisers have.

 

[hastalavista]

Your situation is unusual but not unique. I've seen the same situation in large cities (Oakland, CA) and in the suburbs (Marin County & Alameda County, CA).

There is no rule that says comps must come from Town A if a property borders Town B.

There is a rule that says the appraiser must identify the likely buyer for the subject and then identify where the substitutes are for the subject that the likely buyers would consider as alternatives; that may be in your "home" town, or in the neighboring town, or both (or, neither, but that is unlikely).

And, there is a rule that says an appraiser has to analyze a property to determine if the existing improvements (in terms or size, quality, amenities, etc.) are an "over-" or "under-improvement" for the area. You have a home that was custom built by a developer for his/her personal residence. Chances are that developer put more money into the home than a typical buyer would pay. So, your home may be over-improved for its market.

This is a complex assignment. You'll just have to ensure (if you engage) or hope (if a lender engages) that the appraiser who values your property has the qualifications and competency to appropriately solve this valuation problem.

Good luck!

 

[J Grant]

Good posts above per advice.

Since you as homeowner are going for a refinance, you get to choose the lender. Ask the lender some frank questions about how they pick the appraiser, what they pay them out of your fee to them. Stress that you want a locally experienced and competent appraiser. Best of luck.

 

[Elliott]

aspinfo,
The split tax districts shouldn't be a significant issue. Assessors deal with district lines that cut through properties all the time. They allocate accordingly.

As far as comparables.....all real estate is unique. Find a good experienced appraiser and they will be able to draw upon their experience of similar difficult properties and give you a reasonable opinion.