Not able to rebuilt SFR if destoryed on Commercial zone.

[shinbinim]

I have an SFR appraisal assignment in commercial zone. Called Building and safety and found out cannot be rebuild if destoryed. This is my first time experience with unable to rebuilt. Do I need to continue this assignment same as other assignment or something additional I need to do?

 

[CGinMN]

If you proceed, then you must analyze the impact on market value and marketability. Does the value of the land for commercial use exceed the value under the legal non-conforming use, and are you capable of making that determination? If the improvements cannot be rebuilt, will the city issue permits for any improvements and can it be modified through addition or alteration? If the borrower performs illegal work and/or uses it illegally, will it lose its grandfathered status?

I would research the above and then notify the lender, who may cancel the order.

 

[alebrewer]

^ this. Make sure you're adhering to the principle of consistent use when valuing the land. Use comps with similar zoning attributes to estimate market reaction. One other question for the P&Z guys: can a variance be applied for, and if so, are they ever granted? This will all help your client in decisioning whether to move forward or not. It's been my experience that they generally move forward with the appraisal, but not always.

 

[shinbinim]

Thank you very much for the comments.

 

[Terrel L. Shields]

Here the damage has to be a minimum of 50% before they won't allow you to rebuild. This is a real issue when an insurance company doesn't want to compensate for 100% of the building if partially destroyed.