Mix Condo With Fee Simple

[bnmappraisal]

First off, Gregory, I'm sorry you went through this. I'm glad things worked out with the DBPR. Being here in FL as well, I know how frustrating they can be! Due to your story, I completely understand your hesitation for "going over a mile." It really sounds like you got the shaft on this one! I'm not a fan of either company you mention.
As far as the below:

In the specific (current) case you've posted, I think a non-condo townhouse can be used as a comparable for a condo townhouse if the market reacts to it in the same manner. I have no problem with that and I do it myself. But what I don't do is keep the search to a mile and use whatever I happen to find within that 1-mile radius to value the property. What I do (and recommend) is to find the best comparables and use them. In your current situation, if there is something better that is located outside of a mile, I'd use it. You can use the inside-a-mile non-condo townhouses as well if you think it is necessary to have the magic 3-comps within a mile. But what I wouldn't recommend to you or anyone is to exclude what may be better comparables just because they are outside of an artificial one-mile boundary.

I have to say I completely agree with Denis. Please don't let these idiots control your searches. I agree, it's not good appraisal practice and that it could lead to issues in the future.

In your specific question here, let me ask you this. What about using 2 comps from within a mile and 1 or 2 from outside a mile? Almost all review "checklists" that I know (first hand knowledge) they want "at least 2" to fulfill their "requirements." As long as that's met, they hardly cause a fuss. Just my $0.02

 

[Tom D]

ugly, but back to flagstar. curious as to what the buyer & seller had to say. did the deal go thru? flagstar blacklisted me because of an anonymous, not well written, comment about the value on their appraisal on some mortgage web site. they asked me to rebuke it 3 years later (surprise) so that i could be put back on their list. when flagstar's 1st AMC told me i should be more competitive with my fee, like $125, i decided that flagstar didn't care sh... about any appraiser. i would never do their appraisals. they are on my shun list.

 

[CANative]

 

[bnmappraisal]

CAN, can you elaborate?

 

[CANative]

CAN, can you elaborate?

162 acres with a new(er) three section manufactured home in a remote area in the Redwoods.


Comparable sale 3: 2651 Hot Springs Rd. Although this property is very distant from the subject and required very large adjustments, it is otherwise the most similar sale found. Similarities include a large 191 acre lot, a three section newer HUD code home, a barn and small outbuildings and is enrolled in the Williamson Act. This property is located about 3 miles west of the downtown section of Cloverdale in Sonoma County about 80 miles south of the subject. The area is in closer proximity to the major metropolitan centers to the south and property pricing is much higher here than in the more remote areas of northern Mendocino County. The appraiser has chosen to present the adjustment for location and parcel size difference in the site area of the sales grid because the difference is one of land vaue rather than marketability. Please refer to the attached exhibit addendum pages showing land/lot sales for both the Laytonville/Branscomb area and for undeveloped acreage lots in Sonoma County. Based on an extraction of the improvements to Comp sale 3, sales and listings of similar size parcels in Sonoma County and land and lot sales and listings in the Laytonville area, the subject's land value is about $2,800 per acre while Comp sale 3 land value is about $6,800 per acre. I have made a downward adjustment of $4,000 per acre to the total 191 acres for comp sale 3 which will account for both the size difference and the difference in location. Comp sale 3 features a partial view of Lake Sonoma (a small portion of the lake near a parking lot at the end of Hot Springs Road) and have made a downward view adjustment. Few other adjustments were required.

 

[bnmappraisal]

I wasn't necessarily looking THAT detailed of an explanation regarding your post, but nonetheless, Thank You!

I will say, that provides a good example though of utilizing properties over a mile!

 

[CANative]

I hadn't seen that appraisal in a while and I started reading through it. It was from early 2007 when I was just about to hit the 5 year mark since first getting my trainee license. It's the dangerous period for a new appraiser. I think I did pretty well for still being a little green.

 

[bnmappraisal]

Haha. Yea, not bad for a "rookie"

 

[J Grant]

Back to the OP...yes you can use non condo townhouses and condos with townhouse design. Condos are a form of fee simple ownership, with shared common elements owned, a HOA, docs on file etc. I have mixed in comps when need be and explain. Would a buyer consider them alternates for each other is the issue and test of viable comp substitutes. Are HOA fees and condo fees relative , are amenities similar etc.

If I had a subject condo comp in TH design and only one in subdivision sale, I'd use perhaps 1 or 2 TH non condo sales, then one older sale in subdivision if it exists (even 2 years old), and then find one out of area, or else a condo of different design but similar sf selling within the price range as fourth comp.

 

[J Grant]

Sorry, I fail to see how a 1.6 million dollar property compares with a 500k range property. 80 miles away, probably a very superior area which woudl account for why prices so different? If I were reviewing that the 80 miles in and of itself would not be the biggest issue, it is the extreme price difference means the areas are very dis similar , or whatever the characteristics of the locations, the price alone of sale 3 means it is not a viable alternative comp for a buyer in price range of sales 1 and 2.

A MF home would add minor value proportionately to a large acreage site , and what value it adds can be replicated by a cost approach. Thus a vacant similar size large acreage tract in subject relevant area would be a better comp and adjust for cost to add a MV house to that site/depreciated to contributory value of a similar age MF house

We can go far away when warranted but the far distance has to make sense and be something the same buyer would consider , otherwise it is not a comp. Sure we can make huge adjustments but that does not change the fact that a buyer for 500k range property is not the same /typically motivated buyer as a buyer considering a 1.6 million dollar property.

We have to find comps that are reasonable substitutes for each other and price range is one of those factors. Location is important because location influences price and very often a buyer for a property will consider only that location, or a nearby location. Other times a buyer is looking for a specific property type rather than location, but even there, that buyre has a budget that guides their choices. The buyer who has only 200k to spend in subject location is not suddenly going to have 600k to spend a few miles away. That same buyer is looking to spend around 200k a few miles away. When we bring in comps from farther off areas, it is may not be the fact a property is over a mile away that is the issue; it can be the comp choice or vast difference among areas that is the issue. An UW or reviewer who keys in on the one mile guideline, but the comps are good substitutes for each other is easy to push back on.