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Legal 2 - 1 Kitchen

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alpineinc

Freshman Member
Joined
Jun 18, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey
Legal 2 family, 100% owner occupied so owner took out second kitchen and made it a master bedroom. Full access everywhere. Appraise as SF and allow for added value in being able to use as MF? Or appraise as MF and detract value of adding kitchen? HABU conflicts here. Which way to go? Thanks.
 

moecraig

Freshman Member
Joined
Jan 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
;) Seems to me, since single family are more marketable & appraise higher than Multi-family, may want to suggest to lender that borrower change C/O to single family since he removed kitchen....just a thought
 

alpineinc

Freshman Member
Joined
Jun 18, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey
Actually, MFs are higher here - nice, urban area - adds to difficulty!
 

Frederick R. Ruffell

Senior Member
Joined
Jan 21, 2002
Professional Status
Certified General Appraiser
State
California
It is what it is. A legal 2 unit property missing one kitchen.
If this property were for sale who would it appeal to, certainly not your typical SFR purchaser. I do not know your market but it would seem to me that the likely buyer would be an investor and he/she would demand a discount for the missing kitchen
 

hal380

Senior Member
Joined
Apr 26, 2003
Professional Status
Certified General Appraiser
State
Connecticut
Ok will stick my neck out. If/since the field card calls it a 2 family dwelling, I would appraise it as a two family. I would then deduct the "cost to cure" the missing kitchen. This cost to cure probably would not be too great as I assume the plumbing is still in the walls and a set of HomeDepot kitchen cabs. (I really dont care what the cost to cure is but I am surmising that the cost would be a few Thou.)

I have had similar situations where a legal 2 fam is being used as a illegal 3. I apparise it as a 2 fam, with the 2nd floor unit having 2 levels and more bedrooms than the 1st fl.

Now that I am thinking of it I think I would check with the zoning officer. Possibly it was a grandfathered 2 family, and could not be returned to 2 fam configuration. I realize this concern may be a bit of a reach, but you gotta go to city hall anyway, so just ask one more question.

Regards to all

Hal
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
I think Hal is on the right track.
 

Frederick R. Ruffell

Senior Member
Joined
Jan 21, 2002
Professional Status
Certified General Appraiser
State
California
Gee thanks Mike, Just because Hal uses big words and is excessively verbose he get the confirmation???? <_<
 

hal380

Senior Member
Joined
Apr 26, 2003
Professional Status
Certified General Appraiser
State
Connecticut
Now wait one durn minute Fred, dont get your feathers Ruffelled (pun intended) I dont use big words and the verbyosity is not excessively verbose.

Was gonna buy you a beer but now I won't. :p

Take care guy :beer:

Hal
 

alpineinc

Freshman Member
Joined
Jun 18, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey
Thank you Hal and everyone. I was thinking of doing it as a 2, but just wanted to make sure. This board is an invaluable resource! Again, thanks.
 

Patrick Egger

Sophomore Member
Joined
May 29, 2003
Professional Status
Certified General Appraiser
State
Nevada
lots of good comments, but back to the basics ... this is a highest and best use issue first and foremost ... you'll have to evaluate it both ways to deterime the H & B use and since it appears that both uses are permissible, you would appraise based upon the use that returns the highest present value (provided it meets all 4 tests) and hense the greatest return.
 
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