I need a fast, non-confusing answer :-)

[CANative]

I posted about this job a week or two ago. Thought it went away but now they are almost demanding that I complete it and money/time is <almost> no object.

4 loans on 4 proposed construction SFR's with garage and granny unit. Zero lot line but there is an inch of space between the units. The 4 lots are to be about 2,000 sf each and are being created by a minor subdivision of a 22,000 sf lot. The developers (which are also the borrowers ... and two of which are being held out as buyers) have tentative map approval and there are utility trunks in place.

Client is Chaze which I'm guessing is a federally regulated institution? Reporting format is a Fannie Mae form (I haven't decided which one yet).

Do I HAVE to provide an as is value which at this time would be the as yet undivided parent lot with entitlements. Can the client waive the requirement?

I could probably get away with developing the as is value of the parent lot if I was willing to do some plagerism of a really good self-contained appraisal I have a copy of (it's for a semi-similar project in general area of the subject). But looking at the methodology, it kind of intimidates me.

 

[Michigan CG]

I don't know why you would have to provide the current as-is value of the undivided parent lot. The whole thing is a hypothetical condition anyway.

Explain it in your scope of work.

Do you really mean that the lots are to be 2,000 SF....no yard, driveway????

 

[Mztk1]

I don't think so. My opinion would be that the "as is" value requirement could be satisfied by the land value of the individual 2,000sf lot the property will be built on with a simple comment in the narrative that although the property currently is not subdivided it is based on the hypothetical that it is. Providing a value of the full lot expands the scope of the assignment, in my opinion, and I'd say so in the report.

 

[CANative]

The lots range from 2,100 to 2,200 give or take. A two story 1,300 sf 3/2 at the front of the lot. It has an "L" shape. The next unit is a floorplan flop and creates a small common front yard. The there is a narrow alley between all units and then a 3 car garage with 2 bays on one side and 1 bay on the other. Over the garage is an 800 sf 2/2 2nd dwelling unit.

it is based on the hypothetical

Isn't that the problem? A FRI needs an "as is" value and the only thing that was "as is" on the eff. date is the larger lot.

 

[CURT VAN HOOSER]

I posted about this job a week or two ago. Thought it went away but now they are almost demanding that I complete it and money/time is <almost> no object.

4 loans on 4 proposed construction SFR's with garage and granny unit. Zero lot line but there is an inch of space between the units. The 4 lots are to be about 2,000 sf each and are being created by a minor subdivision of a 22,000 sf lot. The developers (which are also the borrowers ... and two of which are being held out as buyers) have tentative map approval and there are utility trunks in place.

Client is Chaze which I'm guessing is a federally regulated institution? Reporting format is a Fannie Mae form (I haven't decided which one yet).

Do I HAVE to provide an as is value which at this time would be the as yet undivided parent lot with entitlements. Can the client waive the requirement?

I could probably get away with developing the as is value of the parent lot if I was willing to do some plagerism of a really good self-contained appraisal I have a copy of (it's for a semi-similar project in general area of the subject). But looking at the methodology, it kind of intimidates me.

Ummmm...double check? Isn't this just the same as any other proposed construction? Subject to plans and specs and what other hypotheticals you want to throw at it?

 

[Mr Rex]

The lots range from 2,100 to 2,200 give or take. A two story 1,300 sf 3/2 at the front of the lot. It has an "L" shape. The next unit is a floorplan flop and creates a small common front yard. The there is a narrow alley between all units and then a 3 car garage with 2 bays on one side and 1 bay on the other. Over the garage is an 800 sf 2/2 2nd dwelling unit.




Isn't that the problem? A FRI needs an "as is" value and the only thing that was "as is" on the eff. date is the larger lot.

Its the AS IS value of each specific segment you are appraising. Would you ask the same question if you were only appraising 1 of the 4 subject to?

 

[CANative]

How can there be an "as is" value of a segment when the segment is still hypothetical?

 

[George Hatch]

We don't appraise properties; we appraise property rights.

The property interest being appraised doesn't exist as yet. You can't do an "as is" value on those lots until they are created.

It's kind of like trying to appraise the "as is" of a condo while under development and prior to the map being recorded. The condo property interest won't exist until the map is actually recorded, which is often after completion of construction.

 

[Kevin A. Spellman]

As is value, 22,000 square feet with the rights to create four lots. The lender will record four mortgages and the four new lots will probably go to record simultaneously with the mortgages.

 

[Mr Rex]

We don't appraise properties; we appraise property rights.

The property interest being appraised doesn't exist as yet. You can't do an "as is" value on those lots until they are created.

It's kind of like trying to appraise the "as is" of a condo while under development and prior to the map being recorded. The condo property interest won't exist until the map is actually recorded, which is often after completion of construction.

George I'm sure you are right and I am wrong, but wouldn't the AS IS value of the whole be a completely different property interest than what we are appraising? How does USPAP cover the appraisal of 2 different Real Property Interests in the same report? If I'm appraising a SFR in a proposed subdivision before the docs are recorded, am I required to appraise the entire subdivision, or the subdivision before its subdivided, or a hypothetical segment of the subdivsion in the FRT AS IS mode?