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My first Really Weird Appraisal

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Patricia Dominguez

Freshman Member
Joined
Dec 30, 2002
Hello all, I was hoping I could get some feedback on how to proceed with this appraisal. I started appraising in December so I don't have much experience. My mentor thought I was doing great and decided to give me this property in Piedmont, CA it's a veryyyyy nice neighborhood houses sell for $600,000 up to the Millions. But since it was a small average type home she thought it would be a good start. Assessor's records say it's a 3 bedroom, 2 bath house with 1434 GLA. I go there measure the property, it's a split level, main level has 2 beds, 1 bath. It's a downsloping lot so lower level is partially below grade. It has a huge basement/storage area in the front, and finished 1 bedroom, 1 bath, family room, den and fireplace in the rear (that is where the access area is...so you enter into the family). I didn't calculate the GLA at the inspection, and didn't think nothing was wrong with the lower living area. So I get to the office and the main level is exactly 1434, so I freak out, were my calculations wrong what happened to all that living area on the lower floor, I ask the homeowner if it was an addition and had permits. He said he bought it as is and was told it was a 3 bedroom house, MLS says 3 bedrooms and says in comments may need permits for basement. I go to city hall no permits.

So do you think it was a mistake on the assessors part to not include the sqft of the lower area since he/she did include the beds/bath/and rooms in the records. It's made out of the same quality as rest of house was it built that way????? My problem is with comps 3 bedroom comps are 700-800 and 2 bedroom comps are 600-700 a 100k difference. My mentor says to call it a 2 bedroom, its seems wierd to call it a 2 bedroom if all records show 3 bedrooms??? Any comments or sugguestions would be appreciated.
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
Hi Patricia!

Without getting into the obvious ethics problem likely to be pounced by other forum members

(hint- if you are not real sure about measuring you probably ought to be accompanied by your mentor on inspections).... May I reccomend doing a search for ANSI regs using the search button above? I'd do it for you, but my confuser fried and this laptop is waaay too slow....

Addressing the bedroom issue with regard to location in structure:

1. Other folks mistakes are not to be repeated simply because they exist.
. Two wrongs don't make a right was MY mom's saying.... Report what you saw on the above thresahold level...

2. and then do whatever you have to do to explain how the market will react to the reality of the floorplan. If the market don't care neither should you!

3. Marketability in Piedmont with or without permitted area ought to be addressed through making yourself knowlegable about Piedmont area law, which may not apply in the next town over! IF the 'unpermitted area is subject to tearout and inspection you had better address it, if it is 'grandfathered' then skip the worry.

and a final thought: in many areas the below grade are is counted as finished basement and *may* be included in above rgade room count for the purposes of taxation... Have you asked a bunch of questions about this matter? Chatting up the appriaser's office is often a good way to learn how they do it in THIS town vs. that one!

Keep us informed of what you find out!
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
Patricia, ......You may well be the one more directly reliable at unraveling the mysteries that can appear within county records. They can be a good guide and they can be way off. Yes, people do change and add to a house without ever filing permits, and yes, realty agents can be way off the mark at defining and describing a property too. The perplexity you face with this assignment is a good example of the NEED for your mentor to accompany you on the property inspection, and more so now in these start-up months. It is nice and re-assuring to have them say they have confidence you can handle it just fine, without them there, but can you now say that was a good decision ? I can only hope that the very questions you are bouncing off us here in the Forum were also posed to your mentor earlier today. He/she will know your market, its styles and its oddities, far better than we will from afar.

Basement levels are often the level most-poorly defined by counties and listing agents, and most likely to change (after new). Sometimes counties inadvertantly represent built-in (basement level) garage areas as part of the total base area. Beware. As for bedroom count, it certainly is a marketability factor given consideration by many, but as a driving force for pricing the entire house it is not where you need to specifically focus. Don't worry about what the "records" show for bedrooms......your visit and your report are setting the records straight ! They were a guide, you are the new recorder. How the room is presently used is a good bet to optimal function, regardless of what the homeowner blathers about. A "bedroom" should have a working window for ventilation and safe exit, if needed, and some notion of a legitimate closet. If not, then calling it a den, a sitting area, a hobby room, etc. is normal. Call it like you see it, and descibe the heck out of things as you make notes along the margins of your sketch page. Photos, take many. They fill in the gaps, hours later, after you are long gone from the property. Get your mentor out there with you on the next assignment !
 

Blue1

Elite Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
California
Patricia,

County records can be wrong. MLS data can be wrong. In my county, one get's very little help from the county. It's typical to leave the Planning Department more confused than when you went in. Here's my 2 cents worth......

1) The lower level sounds like a "daylight basement" that is, there is egress to grade. Although Fannie Mae guidelines call for these areas to be basements, FANNIE MAE also states: "The appraiser may deviate from this approach if the style of the subjct property or of any of the comparables does not lend itself to such comparisons." (you must explain in detail any devaition however)

2) Just because the County cannot find a permit doesn't necessiarly mean the addition is (or was) illegal. When was it done? Who did it? Can you talk to them? etc. Then I would suggest that you state what you have found out in the body of the report and decide whether or not (based on the information you find out) to include this area as part of living area.

This is my opinion only based on experiences I've had in the past. For what it's worth.........
 

John Hassler

Senior Member
Joined
Jul 23, 2002
Professional Status
Certified Residential Appraiser
State
California
Hello Patricia

I work the northbay and see this kind of stuff all the time. Don't place too much on those public records on older homes. Go down to the county offices and pull the Assessor's, not Building Dept's, file on the property if you can (you will likely need a signed letter from the homeowner as these are not generally public records). Pre-prop 13 (pre-1978), the Assessor kept fairly detailed records of every property and typically inspected the home about every five years with a checklist of the room count as well as a lot of other info. I have been amazed at what I have found in Marin's Assessor's office. I would guess Alameda has similar records.

If the lower floor integrates well into the main home and is of the same quality and finish, I would probably call it a 3 and 2 as that's how the market would perceive it. Does this position pose a risk to you ... sure but there are dozens of comparable judgement calls throughout the appraisal process (do you check every home to see if it was built with any permit at all?). In twenty years I have never seen anybody required to remove finished sub-area such as you have described. Doesn't mean it can't happen though. I have seen a few people hit with double permit fees but this is a drop in the bucket on a $700k home.

This is just my opinion and I'm sure others will disagree. The risk you take is all yours! Welcome to real world appraising.

John Hassler
 

airphoto

Senior Member
Joined
Jan 15, 2002
Professional Status
Retired Appraiser
State
Pennsylvania
And finally .. in defense of the assessor:

New York State 'official' position (Orifice of Real Property Services) is that finished basement area IS included in GLA. Appraisers don't agree, but that is 'the state's' position for assessment purposes ..
 

Elliott

Elite Member
Joined
Apr 23, 2002
Professional Status
Certified General Appraiser
State
Oregon
Patty,
You didn't measure? That's the funest part of the job.

I treat daylite basements as basements or living area
depending on the comparable data I have. I can usually
show it 'washes' anyway with my adjustment if someone gets in
a wad over GLA.

Your a big dog now, don't worry about what assessor's office
employees say. Or like the Springstein song, 'you'll spend
the rest of your life trying to cover it up.'

elliott
 
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