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One Parcel with 2 single family houses

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Hola27

Thread Starter
Sophomore Member
Joined
Dec 2, 2007
Professional Status
Certified Residential Appraiser
State
Ohio
Got a request to appraiser a single parcel w/ 2 single family homes. I'm not sure how to address this. I asked the LO to have the Lender provide me with some direction on how they want to value this 2nd house and he told me to "just appraise the entire property". I'm guessing one is owner occupied and the 2nd is a rental. Anyway I turned the deal down.

my question is.

what form would you use? woohoo
 

Jerry Bone Jr

Senior Member
Joined
Feb 23, 2004
Professional Status
Licensed Appraiser
State
Oregon
I might do a Highest & Best Use analysis, before I could pick the form.
 

Mztk1

Senior Member
Joined
Dec 3, 2006
Professional Status
Certified Residential Appraiser
State
Florida
Assuming it is a SFR residence with an accessory unit, very common animal by me, and that it is mortgage work, I'd use the 1004 and check the accessory unit box.

These types of properties seem overwhelming when they are new to you, but if there are enough of them, they not very difficult.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
4 future reference: assume nothing regarding current use, due diligence demands confirmation

a. determine if there are Zoning and Building Ordinances in effect.
b. determine which Zone subject is located in, what are legally permissible uses under both Ordinances above.
c. determine if current use is a legally permissible use i.e. legal, legal-nonconforming.
d. does the current use transfer on sale
e. determine which is the primary residence and which is the ACCESSORY unit -
1. must the accessory dwelling be "owner" occ i.e. family use only - NON-rentable
2. or............. rentable.
f. determine what the Market indicates as H&BU for the property based on hard data.
e. determine the proper reporting format.
 

Bamba

Junior Member
Joined
Sep 12, 2007
Professional Status
Certified Residential Appraiser
State
Pennsylvania
I have the exact same scenario...did not yet inspect the property...tax records shows a 1770 farm house and a 1970 rancher on same parcel...client wants it appraise as a SFR with accessory unit...I was under the impression that in order to be an accessory unit, it has to be attached to the main house...and not being able to function on its own...was I wrong?
 

Hola27

Thread Starter
Sophomore Member
Joined
Dec 2, 2007
Professional Status
Certified Residential Appraiser
State
Ohio
I agree the zoning issue is the first step.

This accessory unit scenario I think would work for maybe an apartment over the garage or attached inlaw suite but I'm not sure about another detached house. How do you determine total square footate and room count, effective ages, etc. Do the comp sales need to have a second detached house as well?

I think if the second house is a clear rental property you can determine value but I don't think the appraisal will fit on the 1004. Its definitely a portfolio loan situation.
 

Mztk1

Senior Member
Joined
Dec 3, 2006
Professional Status
Certified Residential Appraiser
State
Florida
I have the exact same scenario...did not yet inspect the property...tax records shows a 1770 farm house and a 1970 rancher on same parcel...client wants it appraise as a SFR with accessory unit...I was under the impression that in order to be an accessory unit, it has to be attached to the main house...and not being able to function on its own...was I wrong?


Yes, you are not correct. A detached house can be an accessory unit.
 

Mztk1

Senior Member
Joined
Dec 3, 2006
Professional Status
Certified Residential Appraiser
State
Florida
I agree the zoning issue is the first step.

This accessory unit scenario I think would work for maybe an apartment over the garage or attached inlaw suite but I'm not sure about another detached house. How do you determine total square footate and room count, effective ages, etc. Do the comp sales need to have a second detached house as well?

Total square footage and room count, as well as effective age, is based on the main house. The second house is an amenity, like a barn, workshop, pool, or any other amenity, and comparables should be found with a similar amenity.

I think if the second house is a clear rental property you can determine value but I don't think the appraisal will fit on the 1004. Its definitely a portfolio loan situation.

FHA accepts these properties for FHA mortgage insurance. They are also acceptable for conventional lending. It comes down to how common they are in your market and since you don't know how to handle them, I'd assume they are not at all common where you appraise. When I get a house with an accessory unit in my area, it is generally not something I even think twice about. They are very common here and fit perfectly on the 1004.
 
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