How would you handle this one?

[BenRScott]

Hello all,

I had a call from a home owner about giving a value on their house based on the addition of an elevator for medical use. The elevator would change the marketability of the house moving it from a large 2 bedroom rowhome in Washington DC to 3 smaller bedrooms.

I have never tackled anything like this and alerted the owner to this fact to the lack of experience on the topic. I told her I would look into it for her and see if the appraisal gurus on these forums had any suggestions.

Any ideas? Anyone in the Washington DC metro region that can or would want to tackle this?

Thanks

 

[Don Clark]

Hello all,

I had a call from a home owner about giving a value on their house based on the addition of an elevator for medical use. The elevator would change the marketability of the house moving it from a large 2 bedroom rowhome in Washington DC to 3 smaller bedrooms.

I have never tackled anything like this and alerted the owner to this fact to the lack of experience on the topic. I told her I would look into it for her and see if the appraisal gurus on these forums had any suggestions.

Any ideas? Anyone in the Washington DC metro region that can or would want to tackle this?

Thanks

Ben,

We have several over 55 community's in my market. Some have chair lifts, and I have done one with an elevator. I have also done many appraisals in homes that were in community's where anyone can purchase a home. I have never been able to prove that their is any positive or negative market reaction either way. Now, I would concentrate on the difference in number of bedrooms, not the elevator. I would attempt to see if there is any identifiable market reaction to 3 bedrooms as opposed to 2 bedrooms in the community where the property is located or in similar neighborhoods. Don't be surprised if you cannot find any reaction one way or another.

 

[Ray Miller]

Hello all,

I had a call from a home owner about giving a value on their house based on the addition of an elevator for medical use. The elevator would change the marketability of the house moving it from a large 2 bedroom rowhome in Washington DC to 3 smaller bedrooms.

I have never tackled anything like this and alerted the owner to this fact to the lack of experience on the topic. I told her I would look into it for her and see if the appraisal gurus on these forums had any suggestions.

Any ideas? Anyone in the Washington DC metro region that can or would want to tackle this?

Thanks

I would do just what you are doing, looking for someone to help me on it or send it to someone else to do.

 

[stefan olafson]

Ben,

Trust the advice from Don Clark, he's incredibly knowledgable and gives very well thought out advice on this forum.

You have to look at market reaction, you can't go by cost of the improvement, as we all know seldom does cost equal value. Look to the market for differences in value between 2 and 3 bedroom similar sales. See if you can find any sales with similar assisted living items and maybe you'll find something to hang your hat on.

 

[Webbed Feet]

Sigh.

Mr. Scott,

I have some questions, ideas, and suggestions for you.

A) Appraisers don't "give value," we arrive at our value opinions.
B) I don't believe there is such a thing as basing an appraisal on an addition of any kind. There is basing an appraisal on hypothetical condition(s), extraordinary assumption(s), definitions of value, and other sundry assumptions as needed or called for.
C) Specifying the "Use" of the elevator must be only for "medical" purposes would overly complicate the assignment. Don't you agree?
D) Assuming the marketability of the improvements has been altered at this point (And I am assuming you had not inspected the property yet when you posted, all this is based on a phone call.) is rather premature, isn't it?

Here is what I would do if I were supposed to be a great and wonderful certified appraiser deciding what to do and seeking advice on the matter. I would try asking what the intended use of the appraisal services was for so I could determine what kind of value was possibly involved with the assignment. This way I could not only inform the people I was asking for suggestions about these things, I could also sound intelligently informed when discussing it with the prospective client later. Especially, as I would not want to have to contradict myself later, after I found out the answers I communicated to my prospective client were incorrect, because I completely failed to think about this stuff as important to mention when I asked questions.

Webbed.

 

[Mr Rex]

Be careful as this report may be used for presentation to the IRS for a tax deduction. If the cost of the elevator doesn't return 100% of costs in increased market value, they may be able to deduct the difference as a medical deduction if deemed medically necessary by a MD. (Or something like that, I have done something similar for a lady with respiratory problems installing a high cost HVAC system under Doctors orders)

 

[BenRScott]

Guys thanks for the help and comments on this topic.

 

[incognito]

Another issue to consider is that many areas REQUIRE an elevator in an attached or detached dwelling, for new construction or for major renovations, when there will be 3 levels of living area. I can not speak for DC, but I can tell you that in my area, Brevard County, FL, it is required if you have 3 levels of living area, either as new construction, or for a third floor addition, and even for a major renovation of a 3 level.

FWIW, I just did a major renovation where an elevator was installed. The elevator was $14K for 2 levels, and they said to add about 2K per level, JUST for the elevator. The installation (which includes electric, the "shaft", cut slab, roof modifications for motor, and rails was about $15K. Figure another 3-5K for the third level, for a total cost of about 35K (in Florida).

 

[Zero]

Hello all,

I had a call from a home owner about giving a value on their house based on the addition of an elevator for medical use. The elevator would change the marketability of the house moving it from a large 2 bedroom rowhome in Washington DC to 3 smaller bedrooms.

I have never tackled anything like this and alerted the owner to this fact to the lack of experience on the topic. I told her I would look into it for her and see if the appraisal gurus on these forums had any suggestions.

Any ideas? Anyone in the Washington DC metro region that can or would want to tackle this?

Thanks

In most DC neighborhoods and markets, GLA is a more dominant feature than bedroom count, especially when looking at 2 vs. 3 bedroom properties. For most rowhouses less than 1600 sqft, 2 vs. 3 BRs doesn't have much effect. But look at the data, it will tell you.

Unless this is a high-end renovation, in one of the high-dollar 'hoods, I don't know that you'll be able to find good market data for market value of an elevator. I don't like making adjustments without good market data. Even if you do find a sale, the cost will be far more than market value.

In the thousands of houses in DC I've been in, I've seen only a handful of elevators...one was in a $13 million embassy home off Embassy Row.

Sounds like the potential wants to hang a lot of value on this hypothetical elevator. I'd probably take the stairs running away from this assignment.

 

[Mike Boyd]

There was another thread on this type of thing a few months ago. I would advise you to look it up and read the responses.