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Multi Family Question

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Metroappr

Junior Member
Joined
Jan 20, 2005
Professional Status
Licensed Appraiser
State
Michigan
Hi

I am slow in work so I decided to take on a 1025 order. There is a studio apt in the basement that I was unaware of until inspection. How do you treat a studio apt in the basement? It has a kitchenette, living area and bathroom. Is it considered to be a 3rd unit? How do I do the sketch for the square footage to reflect in the GBA or GLA? I have not done a multi family with a unit in the lower level before. Thanks in advance for the help.
 

hastalavista

Elite Member
Joined
May 16, 2005
Professional Status
Certified General Appraiser
State
California
I don't fully understand the question?

Is this a legal unit? For example, in San Francisco, there is zoning that allows for a 2-unit improvement and an accessory unit. The accessory unit cannot be rented directly. These units add value to the property (many times, this accessory unit is included in one of the other unit's leasehold. Or, it may be retained for the owner's use... a getaway so to speak.). So, is this a legally rentable unit?

If it is, then as a small residential income property, it would be included in the analysis as a rentable unit.
 

Metroappr

Junior Member
Joined
Jan 20, 2005
Professional Status
Licensed Appraiser
State
Michigan
Hi-this is a tricky one. The home is marketed as a single family (on the MLS), the order was for a 1025. The city will not tell me what it is zoned for or if it is legal to used as a multi family. The home was built in 1917 so it may have been converted before zoning which would allow it to be legal non conforming (grandfathered). There was a rental application submitted to the city listing it as a 2 unit and approved. I am going to treat this as a 2 unit with a partially finished basement. The city will not tell me if it is permissible to be used as a lower level 3 unit (triplex) I wished I would have recorded my conversation with them-a bunch of clowns.
 

hastalavista

Elite Member
Joined
May 16, 2005
Professional Status
Certified General Appraiser
State
California
Sounds like you have some work to do on this one.

Good luck!
 

Gobears81

Senior Member
Joined
Nov 7, 2013
Professional Status
Certified General Appraiser
State
Illinois
Hi-this is a tricky one. The home is marketed as a single family (on the MLS), the order was for a 1025. The city will not tell me what it is zoned for or if it is legal to used as a multi family. The home was built in 1917 so it may have been converted before zoning which would allow it to be legal non conforming (grandfathered). There was a rental application submitted to the city listing it as a 2 unit and approved. I am going to treat this as a 2 unit with a partially finished basement. The city will not tell me if it is permissible to be used as a lower level 3 unit (triplex) I wished I would have recorded my conversation with them-a bunch of clowns.
Do you reside in that town? Not sure what size town this is in, but sometimes I do appraisals in communities where I can't get anyone in the government to lift a finger. In some of these cases, the client is centered in that town and after letting them know what the problem is, they call and suddenly I get all kinds of help. I wouldn't recommend just making an assumption that it is a two-unit with a partially finished basement that isn't a legally rentable unit without more information. At least try contacting the client and explaining to them what your challenge is. At a minimum, they might at least have some information that could help decide which direction to go.
 

Metroappr

Junior Member
Joined
Jan 20, 2005
Professional Status
Licensed Appraiser
State
Michigan
Hi-thank you for your input. There is a certificate of rental listed in the online archives listing the home as a 2 units. Would that suffice you? The planning dept is of no help with turn overs and lack of competency.
 

A K

Elite Member
Joined
Jul 31, 2013
Professional Status
Certified Residential Appraiser
State
Maryland
Many jurisdictions have the zoning ordinance available online.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
Location of the property & governing muni ??
 

timd354

Elite Member
Joined
Jan 11, 2008
Professional Status
Certified Residential Appraiser
State
Maryland
Many jurisdictions have the zoning ordinance available online.
And if they don't, the zoning ordinance and the zoning maps are available to the public somewhere - either in the zoning office, the court's law library or someplace else. Sometimes it is necessary to track things down in person.
 
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timd354

Elite Member
Joined
Jan 11, 2008
Professional Status
Certified Residential Appraiser
State
Maryland
Hi-this is a tricky one. The home is marketed as a single family (on the MLS), the order was for a 1025. The city will not tell me what it is zoned for or if it is legal to used as a multi family. The home was built in 1917 so it may have been converted before zoning which would allow it to be legal non conforming (grandfathered). There was a rental application submitted to the city listing it as a 2 unit and approved. I am going to treat this as a 2 unit with a partially finished basement. The city will not tell me if it is permissible to be used as a lower level 3 unit (triplex) I wished I would have recorded my conversation with them-a bunch of clowns.
You had better familiarize yourself with the applicable Fannie Mae guidelines if this is for an appraisal for loan that is going to the GSE's. What you have here is either a 3 unit property or a 2 unit property with an accessory unit. Please note that if you determine this is a 2 unit property with a basement accessory unit, you need to have a conversation with the lender/client informing of that fact as 2-4 unit properties with an accessory unit are not eligible for Fannie Mae financing. One thing that you should not do under any circumstances (if this is an "as-is" appraisal) is to fail to disclose the presence of that basement 3rd unit/accessory unit as that would be very misleading.
 
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