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Land/Manufactured Home packages

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Vegan702

Thread Starter
Senior Member
Joined
Feb 24, 2005
Professional Status
Certified Residential Appraiser
State
Nevada
I am doing a review on a manufactured home from 8 years ago. In reviewing the comps it appears all the comps were land/home packages sold through different manufactured home dealers as was the subject. When trying to research the sales of these homes I cannot find any information that corresponds with what the appraiser has on the report as far as sales prices. I searched the forum and found a couple threads about this, but didn't find a real consensus as to whether these *comps* are legitimate to use. To me it seems they wouldn't be legit sales due to the homes were most probably sitting on the lot and when they picked the home they would then pick out a lot to put it on thus creating a sale. Am I wrong in my thinking? If I am right in what I am thinking where can I find this written to verify this?
 

stefan olafson

Senior Member
Joined
Apr 2, 2003
Professional Status
Certified General Appraiser
State
North Dakota
I believe what you have are not arms length sales and shouldn't have been used. I'm somewhat confused, you're doing a review on an 8 year old appraisal?

Make sure you have that 2000 year USPAP book next to you, as things have changed since then.

Summation: having the land, building, and others come together and add them up is not a correct method to select comparable sales. I don't know where your subject is but if it's on a legal parcel of land you have to have arms length sales on similar type of property.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Georgia appraisers board has written several letters saying they do not consider these to be arms length sales. I agree with them, it's like a custom built home, it was never exposed to the market.
 

Vegan702

Thread Starter
Senior Member
Joined
Feb 24, 2005
Professional Status
Certified Residential Appraiser
State
Nevada
I believe what you have are not arms length sales and shouldn't have been used. I'm somewhat confused, you're doing a review on an 8 year old appraisal?

Make sure you have that 2000 year USPAP book next to you, as things have changed since then.

Summation: having the land, building, and others come together and add them up is not a correct method to select comparable sales. I don't know where your subject is but if it's on a legal parcel of land you have to have arms length sales on similar type of property.


Yes a review on a 9 year old appraisal from 03/1999.
 

Offshore

Senior Member
Joined
Dec 25, 2005
Professional Status
Certified Residential Appraiser
State
North Carolina
Vegan my board does not consider land/home packages to be legitimate sales and stated it in our newsletters more than once. You may want to check with your board and see if they have made similar statements.
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Homes sold off of the sales lot with an unimproved site as part of a package are not considered arms-length transactions any more. At one time, I think they were used but not in the last 6 or 7 years that I know of.

Mfg houses sited on the residential lot and listed with a broker before being sold are considered arms length and subject to all market forces necessary to be considered an acceptable sale, even though they have not been lived in and are owned by the mfg housing sales company.
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
Such sales are the aggregation of site, building and site improvements into a value, reported as a sale. The property is not offered as an arms-length transaction, which is a property, openly marketed, and available for purchase. The sum value of the aggregation of site and improvements are often shown for manufactured homes as sales by manufactured home sales lots, and were utilized by appraisers, as opposed to using sales reported in the MLS system, which were truly arms-length transactions.

At the time you are talking about, these were generally considered to be acceptable. It wasn't until 2002 that lenders began cracking down on the use of such aggregate sales. While you can argue that the value was not supportable, and better sales were available (assuming that you can show this from available data), it's wasn't improper at the time of the appraisal.

Hope this helps
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
Wonder how many appraisers thought they were off the hook after they had the 5 year burn the file party?:unsure:
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
Still are. It's very hard to prove anything after 5 years. I'm surprised this one was pulled for a review.
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
As long as the cold dark heart of an attorney beats, you are never off the hook. Who needs to prove anything? Jurys award on emotion.
 
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