• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

New Adu Bill

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
I am working on a sale of a 2400 SF house on a steep uphill lot. The seller is the RE agent and said he considered building an ADU at the top of the lot. No idea where he got his figures, but he said would cost ~$300k to build and rent for about $4k. Does not sound like a bad return on investment, but he decided to sell. Price is ~$1.9Mil.
$48k less and additional $3,300, minimum addition to the property taxes, plus being a landlord with all the "tenants and toilets" issues. A year to get it done.

I don't know what the pre-sale tax base year tax was but say the new owner wanted to make the same decision. New tax bill would be $24k with a gross rent income from the ADU of $48k. Cuts the tax bill in half.

Would the granny unit get an extra $300k on the sale of the property?

TOP of the slope? Commanding view of the LA basin, ocean and Catalina? AirBnB instead of a full time MTM.
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
Wondering whether the proposed changes to Prop 13 will affect the decision of business owners to own their real commercial property rather than to lease in the future?
It's 1.1%. Would that trigger a decision by a "business owner?" Even if they leased on a triple net, they'd still be paying the property taxes.
 

George Hatch

Elite Member
Gold Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
California
I'm working on a 6-unit apt building in (Westwood) L.A. this next week that is an underimprovement for the site. (in other words, it's a land appraisal) The borrower is an RE Atty and is regaling me with his plans (but no entitlements yet) to build a bigger/better project that will feature apartments set up for single room occupancy, the plan being to rent the rooms individually.

His development model is basically working backwards from the cash flow to yield the value of the site as the residual after all costs and profit. And that's fine for a developer. But I'm appraising to MV and I have land sales data I can use to value the property so that's how I'm going to do it. All of those sold-for-land-value sales will have existing improvements on them.

The point being, when all your comps have the same right to add more units then there's no adjustment to be made for someone's development plans. The comps either have the same additional site area to enable the addition or they don't.
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
If I remember correctly, small LA hospitality property owners and SRO owners had a difficult time making any money because they had obligations to take too many $20-$30 housing vouchers. The only ones to make a living were generationally experienced hoteliers who used family as employees.
 

Lee in L.A.

Elite Member
Joined
Jan 24, 2002
Professional Status
Certified Residential Appraiser
State
California
Would the granny unit get an extra $300k on the sale of the property?

TOP of the slope? Commanding view of the LA basin, ocean and Catalina? AirBnB instead of a full time MTM.
Who knows what it would be worth, not in my SOW, it does not exist. I did drive around to the top, and the houses were so far down I could not tell where mine was. Quite steep, not an easy place to build. Mostly just a canyons and mountains type view from up there.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
AB 2890

State negates Local Municipal Governments/Laws with one stroke of a pen .........

"(4) An existing ordinance governing the creation of an accessory dwelling unit by a local agency or an accessory dwelling ordinance adopted by a local agency subsequent to the effective date of the act adding this paragraph shall provide an approval process that includes only ministerial provisions for the approval of accessory dwelling units and shall not include any discretionary processes, provisions, or requirements for those units, except as otherwise provided in this subdivision. In the event that a local agency has an existing accessory dwelling unit ordinance that fails to meet the requirements of this subdivision, that ordinance shall be null and void upon the effective date of the act adding this paragraph and that agency shall thereafter apply the standards established in this subdivision for the approval of accessory dwelling units, unless and until the agency adopts an ordinance that complies with this section.
(5) No other local ordinance, policy, or regulation shall be the basis for the denial of a building permit or a use permit under this subdivision."
 

ZZGAMAZZ

Senior Member
Joined
Jul 23, 2007
Professional Status
Certified Residential Appraiser
State
California
If I remember correctly, small LA hospitality property owners and SRO owners had a difficult time making any money because they had obligations to take too many $20-$30 housing vouchers. The only ones to make a living were generationally experienced hoteliers who used family as employees.
----

As an aside, Section 8 will no longer be an acceptable criteria for tenant eligibility
 

George Hatch

Elite Member
Gold Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
California
That's going back a ways. How about this one?


zachary all.JPG
 
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Top

AdBlock Detected

We get it, advertisements are annoying!

Sure, ad-blocking software does a great job at blocking ads, but it also blocks useful features of our website. For the best site experience please disable your AdBlocker.

I've Disabled AdBlock
No Thanks