PLEASE Help! Part of house is missing!

[GjJetson]

Still a bit confused. If you have to go through a garage, it still is not GLA. I wouln't pour much money into it.

Well I can agree with that. But what I am basically talking about doing is converting the garage area itself into GLA. That was done to the house next door a few years ago and it appraises 55k higher than my sisters house. Both houses have the same floor plan and were built in the same year. So I wouldn't be creating some monstrosity but rather bringing her house into line with her neighbors and hopefully up a notch or two in value.

I wish I could contact the current appraiser and get his ideas on how he would appraise it with these changes. But it looks like he was a subcontractor for some place in Texas. When I called the 800 number on the appraisal they claimed not to know anyone of that name. Go figure.

Anyhow I do believe I am going to have to have an appraiser take a look at the place as is and give me some advice on how to proceed.

I know that other things are considered of course in an appraisal, but it looks to me that the greatest difference between the "bogus" appraisal and the good current one, are the comps used. They had to go out of the immediate area to find the smaller comps. Most of the houses built in the immediate area were built in the 50's and have had modifications of one sort or the other done over the years and are therefore larger than her house. Her biggest mistake I believe was that when the carport (that is sitting on a concrete slab) was enclosed at one end they used the wrong end. They should have enclosed the end next to the house so that there would be no space between the house and the new room.

My hope is that adding the missing footage back into the house, albeit in a different layout, will cause better comps to be used. I've looked into it and with the extra footage and new layout, there are some comps much closer in proximity that are similar to the layout of my sister's house after the proposed changes, and they all appraise 40-50k higher. It looks like her house is the oddball on the street now that we know there is less living space.

This has been a real bummer finding out that the previous appraiser miscalculated so badly. And my sister didn't even gain any advantage during that refi. All she wanted at that time was to reduce the interest rate. Unfortunately the lender roped her into a "conventional balloon" mortgage somehow. Which is a surprise to me as she knows to run very fast anytime she hears "balloon".

In any case I really appreciate everyone's help here.

 

[Mountain Man]

Another problem is that if you finished the whole thing, including the carport, to be equal to the house and did make it GLA, then you'd have an over improved property for the area. At some point you will max out, and will no longer receive any value for the expense of enclosures. Sometimes it's better to leave the utility as is, and use as extra space, storage, etc.

 

[GjJetson]

George:

If you turn both carport spaces into GLA you'd have to consider what kind of market there is for houses that large in that neighborhood. At some point you reach a point of diminishing returns. Appraisers call this an "over improvement". You've heard the saying "you dont want to have the biggest or nicest house in the neighborhood"? That's what they're talking about; over improvements; the improvements exceed the demands of that market and so add less to the value than you might otherwise expect.

Actually, her house is the smallest one around now that we have the correct footage. Her house has 1451 sq ft GLA. The other houses in the area typically run between 1700 - 2500 sq ft with 1700-1900 being the average. If I turn both spaces into a family room then her house exactly matches the house next door and another one street over. She always thought that her house was the average size but we know better now.

I'm trying to reach the current appraiser to see if I can hire him to advise me as he certainly knows how to properly appraise a place.

- George

 

[David Mescon]

One other little thing I haven't heard mentioned is covered parking. If you convert the carport to GLA you will lost your covered parking, unless you build a new garage or carport. Is covered parking required in your area? If not, have many of the older homes in the area had their carports or garages turned into living area? What is the difference in market value between a carport that is a carport and a carport that has been converted into living area? Will the cost to implement the improvements exceed the differential in value? Just wondering. Good Luck.

 

[Flygirl 152]

George,

If you decide to start doing work on your sisters home, you may be opening up a big can of worms if you do not do it with permits and permission from your local municipality. I have appraised several homes in which the homeowner stated that their neighbor turned them in for converting their garage so one of their family members could live there. I have also appraised homes where the neighbor that didn't have central air conditioning turned in the neighbor that just had it installed because he didn't like the sound of the unit running. When you start making major modifications to a home, you always run the risk of making a neighbor angry for whatever reason. Either they don't like the noise of you hammering, or they feel their privacy is now an issue because a new window looks into their yard or bathroom, or they may just be plain jealous. If they call the city or county on your sister because of this work being done without permits, your sister could be dealing with more than just disgruntled neighbors....she could be paying fines and you may be forced to comply with all kinds of legal code violations.

Just some things to consider before you spend time, $$$ and efforts that may end up costing you more in the long run.

Good luck to you and your sister.

 

[Peter LeQuire]

"When I called the 800 number on the appraisal they claimed not to know anyone of that name. Go figure."

Sounds to me like an appraisal done for an appraisal management company. If you can get a copy of the appraisal (to which your sister is entitled) it would have the name of the appraiser.