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Prospective Value On New Townhouse Construction

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littleherbie

Freshman Member
Joined
Apr 3, 2009
Professional Status
Certified General Appraiser
State
North Carolina
The subject site currently has 5 fully rented townhouses circa 2009. An additional 5 townhouses are being built on the excess land with a complete date of June 2018. I have been asked to estimate a prospective value for the 10 units as of the completion date and am not sure where to start. I valued the existing 5 units in 11/2016.
 

Gobears81

Senior Member
Joined
Nov 7, 2013
Professional Status
Certified General Appraiser
State
Illinois
am not sure where to start. I valued the existing 5 units in 11/2016.
If you've previously appraised the five existing units, what are you stuck on for starting an appraisal of the additional proposed units?
 

littleherbie

Freshman Member
Joined
Apr 3, 2009
Professional Status
Certified General Appraiser
State
North Carolina
If you've previously appraised the five existing units, what are you stuck on for starting an appraisal of the additional proposed units?
This was a first for me. I'm not sure how the existing units enter into the calculation.
 

BRCJR

Elite Member
Gold Supporting Member
Joined
Sep 20, 2005
Professional Status
Licensed Appraiser
State
Virginia
This was a first for me. I'm not sure how the existing units enter into the calculation.
They would enter in the picture just like the first five did. You have 5 existing and 5 proposed. They want the value "subject to" completion? and as stabilized?
Your "as is" should not be to difficult to do since you have the original work.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
The subject site currently has 5 fully rented townhouses circa 2009. An additional 5 townhouses are being built on the excess land with a complete date of June 2018. I have been asked to estimate a prospective value for the 10 units as of the completion date and am not sure where to start. I valued the existing 5 units in 11/2016.

The 10 units, if 5 are rented and the next 5 anticipate to rent at similar rental rates, ( plus inflation), could do an income approach on all 10 units as one of the values.
 

littleherbie

Freshman Member
Joined
Apr 3, 2009
Professional Status
Certified General Appraiser
State
North Carolina
The 10 units, if 5 are rented and the next 5 anticipate to rent at similar rental rates, ( plus inflation), could do an income approach on all 10 units as one of the values.
Thanks. That makes a lot of sense.
 

hastalavista

Elite Member
Joined
May 16, 2005
Professional Status
Certified General Appraiser
State
California
They likely want an as-is, an as-complete, and an as-stabilized.

Are you saying that your not sure how to do this? No shame if that is the case, but as Howard points out, the first thing to do is to disclose that to your client. The next thing to do is to decide (if the client is agreeable) how best to gain competency during the assignment.
 
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