• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

Replacement Reserve Schedule

Status
Not open for further replies.

norapp

Member
Joined
Jul 11, 2016
Professional Status
Certified Residential Appraiser
State
New York
It has been a few years since I last did a 2 family. I need help knocking the cobwebs out of my brain. Can't believe I have to ask this but I honestly don't remember. On the operating income statement where one unit is owner occupied I know page 1 is only for non owner info. On page 2 (replacement reserves) do I still only include info for tenant or both units? one refrigerator or two?, one heating system or two?
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
It does not matter who lives in the units, at some point something will need to be replaced in both units.
 

norapp

Member
Joined
Jul 11, 2016
Professional Status
Certified Residential Appraiser
State
New York
It does not matter who lives in the units, at some point something will need to be replaced in both units.
That's what my brain was telling me. Thanks
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
both units , 2 refrigerators etc.
 

Webbed Feet

Elite Member
Joined
Feb 11, 2005
Professional Status
Certified Residential Appraiser
State
Canada
It has been a few years since I last did a 2 family. I need help knocking the cobwebs out of my brain. Can't believe I have to ask this but I honestly don't remember. On the operating income statement where one unit is owner occupied I know page 1 is only for non owner info. On page 2 (replacement reserves) do I still only include info for tenant or both units? one refrigerator or two?, one heating system or two?

I feel a bit more explanation is needed. Remember, when appraising income properties, it is the hypothetical sale between a seller and a income oriented buyer that is being represented in order to arrive at the market value conclusion. Otherwise, the H&BU would not be a 2-4 family income producing property. Also, much of what you do is directed at the protection of the lender. Therefore, it doesn't matter who is physically occupying the units when the income approach for replacement schedules is considered. Also, keep in mind that you'll be estimating the market rent for both units, not just the rented one. When you reconciliate the income approach of GRM X Income, the income isn't just going to be for the rented unit, it's going to be the estimated market rents for both units. Hence, costs on the operating income statement will be for both units.

If not so, then the HB&U must be something else, therefore is the assignment calling for it as a 2 family appropriate for the intended use and is the scope of work correct?
 
Status
Not open for further replies.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Top

AdBlock Detected

We get it, advertisements are annoying!

Sure, ad-blocking software does a great job at blocking ads, but it also blocks useful features of our website. For the best site experience please disable your AdBlocker.

I've Disabled AdBlock
No Thanks