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Same Story, Different Scenario

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Elite Member
Supporting Member
Jan 15, 2002
Professional Status
Certified Residential Appraiser
North Carolina
OK, Heres my problem.

House sits on 45 acres. It is served by a recorded right of way and it has two public roads that touch the property in different places.

You guess it they want house and five acres only. They currently have deed of trust with this situation but it does not make any sense. It seems to include the whole 45 acre parcel.

The owner gave me a survey with house, septic, well on five acres. The survey does not a have a seperate legal, the surveyor referenced the original deed of 45 acres.

OK, now the problem. The five acres and house sit in such a way that it is slap in the middle of this 45 acres. If we draw a seperate legal description it will be land locked without a seperate right of way across the owners remaining land to reach the other right of way or one of the roads.

I also think I may have a marketing problem with it this way.

For some reason I am having a mental block on this. I know there is an easy way to do this I just cant think.

So who wants to prodd my memory?

Ghost Rider

Senior Member
Apr 27, 2003
Professional Status
Banking/Mortgage Industry
Andrew......This might be the wrong way to do things, but it is the way I have done it for a long time up here (where there are TONS of rural properties on monster tracts of land) and never had an underwriter complain, or heard about an issue being raised.....

I mention the full acreage throughout the report, no exceptions for me. I assign only 5 acres value (as per the clients request) to the first 5 acres of land for the subject property, and ALL the comparables (typically, I can find properties on similar sized parcels, not sure if that is an issue in your case). Therefore, if I have a subject on 45 acres, and the comps all sit on sites of greater than 5 acres, they are all considered equal, as the client has asked for this "extraordinary assumtion" to be made within the report.

Then, in my addendum, I make the following statement:

"At the request of the lender, the appraiser has based this valuation determination based on the subject property with a site of only 5 acres. The appraiser is not a licensed surveyor, and is not qualified to state if the subject site of XX acres could be subdivided to a smaller parcel of 5 acres, or if this type of subdivision would be legally permissable or feasable by local zoning regulations. Further, such subdivision of the property might make providing adequate means of ingress and egress to the subject dwelling impossible, depending on how the land was subdivied to be considered a legal subdivision by the local municipality. As such, the appraiser reserves the right to amend the opinion of value as stateds within this appraisal report."

Since they are usually just worried about placing a lot of value on excess land, it typically slides right through underwriting with no problems, as they don't care if it's legal, and I have covered my butt in the case that they foreclose, and ask "why the hell didn't you give any value to the other acreage the subject has".......Just my $.02.......I'd love to hear how other appraisers handle it.


Elite Member
Jan 22, 2002
Professional Status
Certified General Appraiser
O.K., I'm going to go the opposite. In Texas, there are many times that there are size restrictions for the lender under law (2nd mortgages for example). Therefore, I have to look at a Probable 5 acres that will be surveyed out and value it accordingly (yes, adjusting for access if necessary) and requiring a dedicated and recorded right of way consistent with County or City requirements to the residence. Then, I make it subject to the survey and the right-of-way.

That way, I can value the 5 acres and improvements, and I don't have to go back and do a final. It's all on the UW.

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