Negative Improvement Assessment on Tax Bill

[LeonCLi]

If I see negative improvement assessment on a tax bill for a residential structure that was built well over 100 years ago, is it safe to say that it's fully depreciated and the negative assessment would likely be attributable to demolition cost? I was going to conclude to land value on this parcel anyway, since it's several acres of ag land. I won't be able to do the inspection on this due to COVID19, and it is for a restricted report, that's why I have no idea what the structure actually looks like.

 

[J Grant]

Why can't you do an ext drive by to see what the structure looks like ?

 

[LeonCLi]

I could drive by, the actual building is in the interior portion, obscured by treeline. The client would have to drive out several hours south from one of the heavily COVID19 affected cities to let me through the gate while I'd be driving several hours north from another heavily effected COVID19 cities. We're both mandated 'shelter in place' by our respective counties. The subject property is located in a third county. I remember performing a restricted appraisal report for a property owner several years back with my former supervisor as a trainee, not for a lender. We agreed not to perform an inspection for that assignment and that report went out without inspection photos. This subject property is predominantly vacant land. I think for restricted appraisal reports not for a lender, we are not necessarily required to perform a physical inspection?

 

[J Grant]

Imo whether a physical inspection is needed is about credible assignment results - sometimes it is needed, other times not. IF owner can photo it for you or give a verbal description on phone you believe you can rely on that might suffice.

 

[ucbruin]

Something I've learned from reading many posts....

Ask if this is for FRT or some type of private loan....

 

[LeonCLi]

Thanks, J Grant. The owner has sent detailed descriptions and parcel maps, and gradient / contour maps. I believe the improvements are noncontributory value in this case, even the county assessed it as negative value.

Imo whether a physical inspection is needed is about credible assignment results - sometimes it is needed, other times not. IF owner can photo it for you or give a verbal description on phone you believe you can rely on that might suffice.

 

[LeonCLi]

This is for equity revaluation purposes for current investors in the ongoing operation, I believe. Not traditional private lending.

Something I've learned from reading many posts....

Ask if this is for FRT or some type of private loan....

 

[Terrel L. Shields]

negative improvement assessment on a tax bill

I will refrain from comment otherwise, but I have never seen an assessment where they gave the improvement a negative assessment. Here a fallen down chicken coop used to be valued at $50 or $100 regardless. Later assessors just said "NCV" - no contributory value. They must have some real appraisers in that county.

 

[LeonCLi]

Thanks, Terrel. Here's what the tax bill assessment look like:

https://imgur.com/3VbZI78

This is for equity revaluation purposes for current investors in the ongoing operation, I believe. Not traditional private lending.

 

[Terrel L. Shields]

Thanks, Terrel. Here's what the tax bill assessment look like:

https://imgur.com/3VbZI78

Cool. There are a lot of properties that likely would have all the value in the land and the few improvements are basically worthless. Our assessors are notorious for valuing the land at its HBU and then adding on the value of the building regardless its HBU. I know I valued a commercial tract (now a McDonalds) and the house ended up being moved as it was only 20 years old or so. But its contribution was zero but the assessor had put $8/SF on the land just like vacant nearby commercial land parcels then lumped on about $60,000 for the house.