PLEASE Help! Part of house is missing!

[GjJetson]

Well sort of.

Take a look at the photos and the diagram below. During a recent appraisal only the main section of my sister’s house was included. There is a 268 square foot area listed as a “workshop”, and a small 127 ft storage space off of that which was not considered in the appraisal.

Details:

The “Workshop” and storage shown in the below diagram is found inside of the brick/vinyl sided section you see in the 2nd photo just to the right of the deck. The house used to have a 2 car carport with the small bricked in storage area used for mowers and the like. Several years ago one section of the carport was enclosed to build a game room for the kids. It was enclosed with standard 2x4 framing with a vinyl sided exterior. As for the interior, one wall (leading into the storage area) is a painted wood surface and the other three walls are insulated and pegboard was then placed over the insulation. (I would have used drywall but my Dad had an abundance of the stuff and it was great for hanging things like toys and such). After the kids grew up the room was converted to a bedroom for the oldest son so that he could maintain some privacy while living at home. There are no kids there anymore, so when I recently had a need for a workshop after losing my 21 year old software engineer position, my sister graciously allowed me to store my furniture in there while I rented out my house, and build some worktables to use in my small business. In order to do as little damage as possible I took up the carpet and stored it in the standalone building shown in the diagram.

Recently, my sister decided to refinance her home. When the property was appraised last week the appraiser did not include the “workshop” area or the storage area in the appraisal causing her home to be appraised as 1451 sq feet instead of 1718 sq feet.

I can easily return the space to what it was by putting the carpet back down, moving my furniture out, and installing an air conditioning/heating unit in the window.
I explained all of this to the appraiser but for some reason he still did not include it. I can understand his failure to include the “storage area” as the interior of it is very unfinished. It has no drywall or pegboard or anything else covering the insulation. However, he should have included the larger workshop area since it is really whatever style of room you want to use it as, and it is attached to the main house. My first thought was that maybe he didn’t like the fact that you have to exit to the outside via the french doors in order to enter the rest of the house. But it occurs to me that there are quite a few homes around that have breezeways between sections of the house and this would be the same thing.

Why do you think he did not include these sections and what should I do? The appraisal is almost 40k less than what zillow and similar sites show for the house and it is 30k less than the tax value of the house. And this is NOT in a depressed area.

Thanks for any and all advice. My sister really needs this refi in order to lower the interest rate and get out of a balloon mortgage.....George

Photo-1/Front of house:
http://img203.imageshack.us/img203/1654/frontofhousec.jpg

Photo-2/Rear of house:
http://img203.imageshack.us/img203/7852/rearofhouse.jpg

Diagram from Appraisal(I added highlights):
http://img641.imageshack.us/img641/3949/diagram.jpg

 

[Cob]

I would have done what the appraiser did, I wouldn't count the space next to the carport as gross living area of the main house, the main reason being is that appears you can not access the main house from the unit next to the carport without going outside. I give that area and the storage value, but I wouldn't count the work shop as gross living area with the main house.

You stated there is no air/heat in the "work shop" you also stated that you have to exit the work shop to get to the main house, I don't really consider it to be attached to the main house if that's the case. You can argue with the appraiser all you want, I think he did it right.

Although I have known of several cases when a homeowner fights the appraisal district for these types of properties, their argument is usually that it is NOT gross living area because they want their property taxes lowered, then when an appraiser comes out for financing, they want it to be gross living area so that appraisal will be higher.

 

[nstanbru]

After looking at the building sketch, I agree with the appraiser. I wouldn't have included the workshop area as part of the main home living area either. It is attached to the carport, not the home, and is only accessible from its own outide entrance, not directly from the main home. It may or may not contribute to value depending on interior finish, heating/cooling, permits, and market acceptance. If it does add to the overall value, its contribution would be a separate factor in the report. Check the report to see if the workshop was given credit, just not included in the total living area.

 

[Mexilady]

The American National Standards Institute or ANSI standards of measurement

“Living area (sometimes referred to as "heated living area" or "heated square footage") is space that is intended for human occupancy and is:


1. Heated by a conventional heating system or systems (forced air, radiant, solar, etc.) that are permanently installed in the dwelling - not a portable heater - which generates heat sufficient to make the space suitable for year-round occupancy;

2. Finished, with walls, floors and ceilings of materials generally accepted for interior construction (e.g., painted drywall/sheet rock or paneled walls, carpeted or hardwood flooring, etc.) and with a ceiling height of at least seven feet, except under beams, ducts, etc. where the height must be at least six feet four inches [Note: In rooms with sloped ceilings (e.g., finished attics, bonus rooms, etc.) you may also include as living area the portion of the room with a ceiling height of at least five feet if at least one-half of the finished area of the room has a ceiling height of at least seven feet.]; and

3. Directly accessible from other living area (through a door or by a heated hallway or stairway).”

I am not a fee appraiser anymore, but the ANSI standards is what I used. I work for the assessor now and it would be included as semi-finished or workshop in the assessment appraisal too. It should never have been included in living area at all in the first appraial due to walking through unheated area, etc. The assessed value (depending on when the last reappraisal was) was probably based on square footage information from the last sale or refinance. She could at least appeal the tax appraisal (using this new appraisal as evidence), but it should not be included in the gross heated living area.

 

[residentialguy]

There is no way that I would have considered the workshop in GLA. You might as well count your garage, too, if you're going to do that.

 

[Michigan CG]

To appraisers posting here this is a moderated section of the forum. You will not see your posts until they are approved by a moderator. On weekends that can take some time.

 

[residentialguy]

To appraisers posting here this is a moderated section of the forum. You will not see your posts until they are approved by a moderator. On weekends that can take some time.

Going to have to hire an AMC to cut your fees and make your turn times faster :icon_mrgreen:

 

[Tom Woolford]

Congratulations! You got an Appraiser who actually knew what he was doing! I agree with him completely.

 

[Metamorphic]

The house used to have a 2 car carport with the small bricked in storage area used for mowers and the like. Several years ago one section of the carport was enclosed to build a game room for the kids.

Whoever enclosed the carport enclosed the wrong end of it if they wanted GLA.

The better move would have been to convert the existing carport space area, make it master suite, and create the game room in the area to the left of the kitchen.

It sounds like a space that has utility, and hence, would have value in most markets. However, its a pretty rare circumstance that that value of that area would be as great as if it was attached living area, since typical buyers prefer their bedrooms attached. Typically a space like that would be recognized in the sales comparison grid in the "Basement" line provided there is not an actual basement.

 

[Paul Isolda]

1. Looking at the sketch, the workshop is not GLA. It has to be accessible from inside the rest of the house.

2. Zillow is the perfect example of "you get what you pay for", it's useless for an opinion of value.