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Rent and Income for an unrentable Duplex

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Joined
Nov 7, 2005
Professional Status
Certified Residential Appraiser
State
Florida
Working on a Duplex REO. The place is a total mess. All of the copper pipes were ripped out of the ceiling and walls, electrical ripped out along with the typical missing A/C, kitchen and appliances, flooring and such.

This client requires an 'AS IS' value. So my main question, is how to determine rent schedules for a property that is basically un-rentable. I am waiting for a call back from the client to discuss the possibility of CB4 but don't think they will buy it.

Suggestions?
 

PropertyEconomics

Elite Member
Joined
Jun 19, 2007
Professional Status
Certified General Appraiser
State
New Mexico
Working on a Duplex REO. The place is a total mess. All of the copper pipes were ripped out of the ceiling and walls, electrical ripped out along with the typical missing A/C, kitchen and appliances, flooring and such.

This client requires an 'AS IS' value. So my main question, is how to determine rent schedules for a property that is basically un-rentable. I am waiting for a call back from the client to discuss the possibility of CB4 but don't think they will buy it.

Suggestions?


Dont do an income approach.
 

Vivian Bachner

Junior Member
Joined
Oct 6, 2006
Professional Status
Certified Residential Appraiser
State
New Jersey
I agree with PE - the income approach is not applicable if a property is not rentable
 

CCAAMO

Senior Member
Joined
Sep 17, 2007
Professional Status
Certified General Appraiser
State
California
If you do an income approach and base it on the repaired condition of the units is rentable be use to deduct the rent loss for the time they are being repaired and the time it will take to rent them out. Of course you would also deduct the cost of repairs and the market reaction to the present considtion to arrive at an " as is " value.

Overall I would agree with the first two posts and indicate it is not in rentable condition and the potential buyer of the property in its current condition would purchase the property based on the market data approach.
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
"Ditto" to the three above posts.
 
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