improvments only appraisal

[Fred]

Replacement cost less depreication. Intended use is for tax purposes. client is donating improvments (that's right, they will have them hauled away.

I am with Joyce, except that "appraisers" do appraise personal and business property. Unless something is missing from the explanation, the city is getting personal property.

If you are not buying an interest in land, you are not buying real estate.

 

[SoCal Appraiser]

If they are going to haul off the house, then the value is the value of the house sold for same. I know houses that have sold from $500 to $10,000 to be moved. A local mover will move say 30 miles for about $15,000-20,000. Then you remodel. It is economic to do so, but the sale prices are generally quite low.

If you are asked to value the house "as is" but separate out the land value, then by all means do so but make sure they are not expecting the value of the house as if it is going to be moved. Same with Mobile homes. On site value is different from a value for them to be moved.

Very good point! I wonder if any records (local or national) are kept of these sales, and where they can be researched (I would imagine ebay, craigs list, even MLS for active listings, but any records of the actual sales??)

 

[Joker]

This is not difficult provided you have clear cut direction from the client regarding value definition. If it is PMV, then carefully read the definition of PMV and ask yourself how that applies to your valuation problem. It is likely not PMV.

If a depreciated replacement cost is the assignment, do so. If reproduction cost is the assignment, do so. If PMV is the assignment, you may find that the value is very very little. I have had similar assignments where the assignment was actually a before/after (like in condemnation work) value and in your case, the value of the improvements this approach would result in a zero (or perhaps negative) value.

Get clear cut direction from your client and a signed engagement letter before you begin. I hope you were astute enough to price this job by the hour and not the same as a URAR.

As for forms. Forget about forms. You do not need a sketch and you do not need photos. Read the appropriate standard from USPAP and follow the outline of the reporting option geared toward your assignment and the scope of work. Plan on a well written narrative.

 

[Mark K]

If improvments are obsolete, SCA extract land will give negative value (current use is residential, therefore residential comps. But lot is commerical zoned / more valuable than current SFR use). Finding commercial zoned SFR comps wihtin reasonable distance / time will be next to impossible. I can do SCA for lot as vacant, but that will not give me anything for extraction.

It looks like you're trying to find value that doesn't exist.

The improvements appear to be a liability, not an asset. If the value of the land is higher than the value of the land plus the improvements, the improvements have no value except potential salvage.

If it has historical value, you are in for a very complex report and I hope you've quoted a fee that will reflect the time involved. Especailly if the IRS will be reviewing the "donation". I can't think of a good reason to move a delapidated house unless there's historic value.

I've appraised improvements only but usually for developers that are buying say, a house and 10 acres. Developer is paying $50K acre plus the value of the improvements to the owner. Find similar houses for the grid, deduct the site value from the comps, and you end up with improvements value. Fairly straightforward.

Terrell's idea is a good one if you can find any sales. I know of these sales but they are generally houses in good condition (being moved because of airport expansion). In this case it is economically viable only because the property was in good condition prior to the move. The older homes in poor condition are demolished, not moved.

 

[The Warrior Monk]

Replacement cost less depreication. Intended use is for tax purposes. client is donating improvments (that's right, they will have them hauled away.

I would get clarification from the CPA or attorney as to what needs to be done. It sounds to me like the contributory value of the improvements needs to be determined (i.e., market value of the property "as is" minus the market value of the land under the hypothetical condition it were vacant). The IRS uses Fair Market Value.