I hate irony in an appraisal

[CANative]

So I accept this assignment for a partial release. Shouldn't be too hard. 6.5 acres now with residence. They want to know "as is" value and value after releasing 1.5 acres. I know the street well and I've driven by the subject for comp photos. There is no measurable difference in price paid for small differences in this range and I know that the subject is on a pretty steep lot with a really great view. And after inspecting the property and finding out that the 1.5 acres to be divided off are impossible to get to from the subject property (way to steep) and is a piece of marshy wetlands I figured this one was a piece of cake.

So after sitting on this for a few days thinking it was a no brainer I take a closer look at what's available for comps. 4 sales in the 2 to 10 acre range this year in a large area surrounding the subject location. About 15 sales in 2007. Very slim pickin's and there are no really similar properties which have sold. So after fooling around half the day I've decided that only 3 sales will work.

But here is the ironic part:
Comp sale 1, 5 acres, s/p $636,000
Comp sale 2, 6.5 acres, s/p $662,000
Comp sale 3, 7.2 acres, s/p $760,000

The reasons for the differences in the sales prices are not related to the parcel size. It's a combination of views, the age, quality and condition of the improvements. But on paper it looks like the sales are saying exactly the opposite of what I stated as my opinion (same market value 6.5 acres or 5 acres).

I'm trying to write a nice little sentence but everything I write sounds funny.

 

[Mike Boyd]

How can it be a "steep site" AND "marshy wetlands?" I don't think I have ever seen a STEEP marshy wetland. Maybe they are selling the marshy wetlands piece as some kind of environmental trade-off.

 

[Jill Kinnaird]

Calculate the value of the 'excess land' for each comp. That should give you a range of value for the 'excess land' of your subject.

 

[Couch Potato]

But here is the ironic part:
Comp sale 1, 5 acres, s/p $636,000
Comp sale 2, 6.5 acres, s/p $662,000
Comp sale 3, 7.2 acres, s/p $760,000

The reasons for the differences in the sales prices are not related to the parcel size. It's a combination of views, the age, quality and condition of the improvements. But on paper it looks like the sales are saying exactly the opposite of what I stated as my opinion (same market value 6.5 acres or 5 acres).

I'm trying to write a nice little sentence but everything I write sounds funny.

How can you be sure of this?


Now take your answer to that question and put it in your report. :new_smile-l:


Do be sure you are not letting your initial bias prevent you from making the right call. Have you considered the difference being the reason for the price differences with the views, age, quality and condition having negligible impact? Showing the data does not make sense when considered this way would be a way to get the message across.

 

[panappr]

Figure the difference of the surplus land and its contribution, if any????

 

[Flakey]

The reasons for the differences in the sales prices are not related to the parcel size. It's a combination of views, the age, quality and condition of the improvements.

Perhaps you've answered your own question.

 

[CANative]

How can you be sure of this?

Define "sure of." I have a good deal of confidence from appraising this type of property in this county over and over and over and over again.

How can it be a "steep site" AND "marshy wetlands?" I don't think I have ever seen a STEEP marshy wetland. Maybe they are selling the marshy wetlands piece as some kind of environmental trade-off.

Do you remember Watson Road between Vichy Springs and Rogina Heights? It's a very steepdownslope and the lot is about 300 by 900. The bottom of the lot levels out. You can see it from Perkins next to that big vineyard.

Apparently the neighbor has been using it for some time and doesn't want the subject property owner going on the neighbors lot to get back to that bottom area. So he offered to buy a portion for a small amount.

"Excess land"
The lot has R1 zoning which is for residential development on 6000 SF lots. But the lot is too steep for developing more lots. I don't think there would be a market for building houses on small lots along this road. Better as an estate size lot with panoramic views.

Figure the difference of the surplus land and its contribution, if any????

Haven't been able to figure any difference after almost 8 years. The difference is just too small, the sales are far and few between, there is no conformity between lots and improvements, blah, blah, blah. I can figure out differences when working with much larger lots, but this one is just too small. A 5 acre lot does not have a different highest and best use than a 6.5 acre lot in this particular area.

Besides, the part that's being chopped off is useless if you can't get to without trespassing or hanging a rope ladder.