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My First VA Duplex Appraisal

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RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
OK, VA appraisers................

I have been assigned a VA appraisal which is duplex property. Each unit has 2 bedooms, and the total building area is around 2,300 sq ft.. The duplex was built in 2008 a short time after the real estate meltdown occurred. The exterior of the duplex is made of cedar siding. The duplex is located in a rural section of North Sevier County, TN. There are 2 MLS systems which cover the Sevier County. I have searched both of them for duplex, triplex, and 4plex properties that have sold in the last 12 months and then went back 3 years to see what had sold.

Here is what I have: Subject is a 2 story structure with two 2 BR units side by side. I found one duplex with 2 BRs each. The structure is one story with the units side by side. This duplex is in a much inferior neighborhood when compared to the subject and sold for $115,000. I found a 4plex property which is a 2 story structure. Two BR units side by side. It sold for $349,900. I then found two triplex properties with 1 BR units. The units are stacked with 2 on the lower level and 1 on the upper level. Both triplex properties sold for $130,000 each. Nothing better has sold in the last 3 years according to the MLS systems.

How would you approach this appraisal and be in compliance with VA's requirements?
 

Peter LeQuire

Elite Member
Joined
Jan 3, 2005
Professional Status
Retired Appraiser
State
Tennessee
Have you looked at the Lakeway MLS? Many of the Hamblen County brokers handle Sevier County property.
 

Peter LeQuire

Elite Member
Joined
Jan 3, 2005
Professional Status
Retired Appraiser
State
Tennessee
That's my next option.

I don't know VA's requirements about such, but I would think, given the scarcity of 2-4 family properties, it would be difficult to assign any value differences related to jurisdiction/county in that lightly developed area.
 

Don Clark

Elite Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Virginia
I don't know VA's requirements about such, but I would think, given the scarcity of 2-4 family properties, it would be difficult to assign any value differences related to jurisdiction/county in that lightly developed area.

You get paid a lot more fr a 2-4 family. Don't think Duplex, think 2-4 family. Find the best comparable sales in that grouping. I do not know your market but I do know that in any market (at least that I am aware of) it is a market area that you need to search. there likely are not any duplex neighborhoods.

VA does not require a cost approach. They do require the income approach in a 2-4 family appraisal. You can use either your sales comps for the rental comps if they are rented, or use rental comps that have not sold. You must inspect each unit.

I do maybe 1 a year.
 

gregb

Elite Member
Joined
Sep 3, 2011
Professional Status
Certified General Appraiser
State
California
The VET/Borrower must occupy one of the rental units if it is a mortgage refinance.
 

Don Clark

Elite Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Virginia
The VET/Borrower must occupy one of the rental units if it is a mortgage refinance.

A Veteran has to occupy one of the units if it is a purchase as well.
 

GA Benny

Junior Member
Joined
Oct 19, 2007
Professional Status
Certified Residential Appraiser
State
Georgia
The VA guidelines do not specify what comps you must use, just that the opinion of value be credible. Use the best you got. Make your adjustments and explain, explain, explain!
 

Eli

Elite Member
Joined
May 12, 2007
Professional Status
Certified General Appraiser
State
Tennessee
The fields on the form will help you. You sound like you are in the preliminary analysis stage. Find some rent comps that are similar and give considerable weight to income indicators in both sales and income analysis. You'll do fine. Reconcile and summarize. Remember you are using market indicated rents on your sales and rent comps and the subject, not necessarily actual. You analyze the rents both actual and market based and reconcile. It sounds harder than it is. It's not very hard. You'll get a good feeling the further you go. Dig deeper.

Congratulations l! I had to throw that last part in! :rof:

If you run into a brick wall, call Atlanta. They have some sharp cookies. :)

Let me retract. You are using market based rent on your sales. Your looking at actual rents too though. Actual on your rent comps but reconcile on both relative to the subject and terms, etc. You can use both market based and actual on your sales but you need to reconcile. The subject and comparables may be below or above market in rents based on your analysis. Look at active rent listings.

Touch back when you get a little deeper in if you need to.

It's like all assignments. Things get clearer the further you go.
 
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RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
Thanks for the responses. I believe I have all the data I need. I was able to locate adequate rental data to establish a market rent and a GRM. You are correct. This is not going to be as difficult as it looked.
 
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