No Central HVAC - Fannie Mae Policy

[alebrewer]

But an old fashion Warm Morning gas stove with a thermostat and a window AC or two, well is that 'inadequate', or simply becoming increasingly uncommon?

Haha - now you're arguing to argue my friend. I think most folks would agree that using a gas stove to heat a home isn't the optimal solution - although I wouldn't argue that having a gas wall stove in the bathroom is really nice on a cold morning.

 

[Terrel L. Shields]

gas wall stove in the bathroom is really nice on a cold morning.

I prefer the electric heater in the ceiling for the bathroom. I sleep in a cold room because that was the way I was raised. Dad got up before everyone else and stoked the old wood stove up, so it was reasonably warm but my room was so cold I often had frost on the inside of the window next to my bed. Even in 40 degree weather, I still sleep with my head near a window and the window cracked open an inch or two.

 

[alebrewer]

Same.

 

[J Grant]

It is not accurate. The Selling Guide is the document that is used to determine accurate - not AI. Aren't you the one who doesn't believe in AI?

Now you see why!

 

[J Grant]

that is a pretty 'iffy' requirement. Who is to say?

Seems like appraisal 101.
Who is to say? The appraiser, by studying the market.
If we can not study the market to determine the impact of major features or defects on marketability and price, then what use are we?

 

[J Grant]

Nice anecdotes, but it is not about our personal preference - it is about what is typical for the market -

 

[Mark K]

And, if I were building a new home, you can bet I would go the geothermal route even knowing the market would discount it.

The market around here loves them. You even get a bit of a property tax break for geo, about $150/year.

The ideal setup in the rural areas are geothermal with propane heat backup. One guy had a closed loop for heat exchange and then hooked it up to the tubing under the floor of his detached garage. No extra heat source, just used the ground temp to heat his garage to about 50 degrees in the winter basically for free except for the cost to run a small circulating pump.

 

[Terrel L. Shields]

Who is to say? The appraiser, by studying the market.

Obviously but

heating must be commensurate with market expectations

So, what do we know about "market expectations" when the average home is CHA but when it only has a space heat and window air, are we adjusting for the functional obsolescence or simply for the difference in cost (aka contributory value?)

 

[J Grant]

Obviously but

So, what do we know about "market expectations" when the average home is CHA but when it only has a space heat and window air, are we adjusting for the functional obsolescence or simply for the difference in cost (aka contributory value?)

1) cost is not always the same as contributory value. the CV might be the same as cost, or more than cost, or less than cost.

2) impact on price, DOM, appeal - talk to area RE agents, etc. Buyers are often cash-strapped and having to spend thousands more on heat/AC is best avoided - though if a home does not have CHA, it might be outdated in other ways as well.

Each appraisal is different and there is no formula. That is why we have a job

 

[alebrewer]

Obviously but

So, what do we know about "market expectations" when the average home is CHA but when it only has a space heat and window air, are we adjusting for the functional obsolescence or simply for the difference in cost (aka contributory value?)

I mean - I think that's how we calculate functional, right? Potato/potato. I just know that - in Texas - there's a SIGNIFICANT premium for HVAC over window units (around $10k for the ~ $250k price point in my market). I suspect it's about the same in Arkansas as well - gets pretty toasty in the summer there too...