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Plan of Action for Historic Home

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Jeff Horton

Thread Starter
Senior Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Alabama
Need someone to tell me that I am right. (or wrong) I am about to start an appraisal on a Very Old home in our small town. Built in 1890 I believe. Very nice, lots of upgrading ect. Very upscale in it's day. It is located in a two block area that they are attempting to make a Historic District. There is only 2-3 other homes that are similiar in the area. None have sold any time recent. I am sure the home is perfectly marketable, just nothing to compare it to.

My plan is to use homes of similiar size and upscale amenities. See where that leads me. About 60 miles away in a larger city there is an active market in a fairly large Historic Distric. So I am thinking of using sales from there as comps 4-6.

There is one sale of a similiar ages home about 2 years ago but it needed lots of work and sold and was rezoned commercial property. (Mortgage Co.)

This is for a mortgage lender and I know they will not accept sales 50+ miles away as my main comps. However that is the better data in my mind than anything local.

Any other suggestions? Have I overlooked another option?
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
U R :arrow: (...er, I think :lol: :lol: )

Does that help???

You discussed the lack of local comps, but who are the local buyers?

Is the Historic District in place, a rumor, or are any houses in the area on the Register???

In the State of Kansas there is a pending bill which will require approval by State Historical for any permits pulled within a 500 foot distance from any house on the register... I understand many states are considering such measures.

Beeee Careful on this one. :roll:

Call the client and discuss the fee, and comp situation...
Being a broker they may have a different end client for this type of property.

Disclose explain and book err 'Bill' them Dano. or run like the wind, and let some fly-by-night do this one!
 

David S. Roberson

Senior Member
Gold Supporting Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
If this house has been upgraded like you say, got any similar sales in your market with similar EFFECTIVE (sorry, I don't know how to underline) age?
 

Nancy in Friday Harbor

Junior Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Washington
Jeff,
If there are, as you say, only 2 or 3 other homes in this area similar to your Subject --- uh, how do they make an historic district out of 3 - 4 houses. What is the rest of the development in the immediate area like? What is the use of these other "historic" houses. What is the zoning? What is the most likely use/zoning in the foreseeable future, ie are the other houses in the area being used as offices or something other than single family residential.
Lots of questions here. I echo LeeAnn's comment of "Beeeeee careful".
This is going to take extra research, talking to the powers that be in the Town zoning/planning/land use department and a ton of explaining to your lender. Keep them apprised of your findings as you go along.....

And enjoy a challenging assignment :) that breaks the humdrum of a "cookie-cutter" world (yeah, right!!) 8O :roll:

Nancy
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
Oops, posted the wrong address, he is in the process of developing his web site. His email address is [email protected]

He is looking for historic homes to place on his web site.
 

Jeff Horton

Thread Starter
Senior Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Alabama
OK, I think I mislead you. When I said 2-3 homes I meant of the same style/achitecture. And actually there is only one other house in town of the same stylel and it sold about 3 years ago. It is very similar but it was zoned commercial before it sold and one of the Mortgage Companies bought it and made an office out of it.

Also the home is not on the Historic Register. It probably could qualify though.

My subject is located in a 3 block area of old homes. The Planning commision has drawn up the zoning to make this a Historci Distric and limit what can and can not be done with the homes. The city commision is sitting on it at the momemtn. The main reason if the owners wanted to keep the homes residential and stop the commericail zoning from creeping in. Several older homes have become buisnesses in past few years.

Sorry about the mix ups there!
 

Jeff Horton

Thread Starter
Senior Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Alabama
I have gotten into this thing. I have no current sales of old homes. I do have some have older sales of older homes around town. I just do not feel the new sales are good comps. Yet I know the UW will have a cow using sales that are 3 and 4 years old even though that are old homes. So I have decided to just do both. I am going to use 3 current sales of similar sized homes and quality (well sort of). I am also going to use the old home sales. Just make a time adjustment. I am thinking I am going to use the 3 sales as comps 1,2 and 3 since in my mind they are more representative!

Then I will batten down the hatches and wait on the upcoming storm! :)
 

Judy Whitehead (Florida)

Senior Member
Joined
Jan 20, 2002
Professional Status
Certified Residential Appraiser
State
Florida
I guess what disturbs me is that you have knowledge that the city is attempting to limit the use of the homes in the neighborhood. Even though the use is presently residential, what the changes in zoning or land use in the neighborhood could affect future values.

Our little town is similar to what you are describing. However, they have not attempted to make anything into a ''historical'' district even though we do have some homes on the historical register. The zoning on the majority of them is residential and conversion to commercial can only be done through the rezoning process, which is difficult. I have had to appraise these homes before and have used more contemporary homes. I have also used older sales, although I try not to go over two years old. The condition of the subject, effective age, remodeling, and how they compare to other residential homes as similar as possible was the basis for comparison. I would think that homes 50 miles away would not compete in the same market place. You have to ask yourself who would buy it and what is it's highest and best use. Once you have established your market, then perhaps it will be easier to choose your comparables.
 

BarbaraNJ

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey
I had the fortune (or misfortune, depending on your point of view) to have to appraise a home which I was informed was on both the State (NJ) and National Historic registers. A portion of the home was very old, with two or three subsequent additions (typical for homes 100+ years). Its condition was slightly below the area "average", and many of the improvements were NOT done with historic accuracy.

First, I found out how to research the Historic Registers. I found them at the County Center (usually near the county court house and deeds registry). Next, find out if your home is on it. If "Yes", then you will need to compare to sales of homes on the register only (similar appeal, only certain buyers will be bothered purchasing such a home) if "No", then go ahead and use any homes you feel are similar.

My home was indeed on both registers----I then gathered all of the sales of 100+ year old homes within 18 mos. of the inspection date. Took those sales and went back to the Historic Register, and selected the homes both nearest to the subject and on the Register. Then wrote an extra long addenda explaining what I did, and kept lender informed at all times.

Did not get paid near enough for all the work, but did get a great education and it was interesting learning something new for a change. Would not want to work an extra 20 hours on every job, but now I would not be timid in accepting another similar assignment, and would now know what to charge !!!

Good Luck !!!
 
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