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Multifamily in Waterford

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Ion Caza

Thread Starter
Sophomore Member
Joined
Oct 21, 2005
Professional Status
Certified Residential Appraiser
State
Michigan
Hi,

I have a multifamily in Waterford and of course no comps. I tried to look on PRD but same thing. Any idea where to find some comps? Closest comps are in Ferndale, Troy and Royal Oak. (Map search on 15 miles radius). I am not very happy with them

I tried also to find out the GRM but nothing is consistent.

I appreciate any sugestion.

Thanks
 

Kali the Boston Terrier

Senior Member
Joined
Jul 7, 2003
Professional Status
Certified General Appraiser
State
Michigan
Ion:

They are there, but dated...I've done at least 7 of them in the last 24 months. You may want to try typing in the remarks search field "in-law qrtr" or mother in law suite" or some derivative of that. Many multiple family properties in Waterford are only allowed to operate as single family with "In law quarters". Obviously they rent the quarters out, but many times they will not list them as multiple family. I would not look to Ferndale or Royal Oak given they are not competing markets. You will have to adjust the sales downward for time, and in lieu of GRM, I would develop a OAR (aka Cap rate) based on current lending terms. To develop the Equity dividend rate you may want to take apartment sales (recent) in Waterford to develop what kind of return these investors are looking for locally. Try not to use a big apartment, one with 5-9 units.

My office has about 25 investment properties in Pontiac listed right now. Many of them are duplexes and triplexes. You may want to look to those for the investment market upper boundary in cap rates and/or GRMs, but keep in mind Pontiac is more risky then Waterford, so it may not be entirely helpful. Typically a listing will reflect an upper boundary for GRM and OAR, suggesting that a buyer will not pay more in GRM or OAR then the next alternative. So you can always use those as a test of reasonableness after you have developed a OAR.

IMO
 

Ion Caza

Thread Starter
Sophomore Member
Joined
Oct 21, 2005
Professional Status
Certified Residential Appraiser
State
Michigan
Thanks Brian !!!
 

Kali the Boston Terrier

Senior Member
Joined
Jul 7, 2003
Professional Status
Certified General Appraiser
State
Michigan
Anytime!

Usually a talkative group. Maybe the thread should have been disguised as comp checks or HVCC, then maybe a few people may have checked in. But ask a bunch of appraisers on basic income approach stuff...silence.
 
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