Shed-House "Shouse" design properties and secondary market

[Terrel L. Shields]

What are you using to determine the shouse label?

I think that is a key element. My nephew's house was comparable in cost to other traditional housing around. But I've seen some houses that are costing 30% less. The construction techniques are the heart of it. If the building is post & pier, floating slab foundation, minimalist interior, maybe even a colored concrete finish and no floor covering per se, perhaps "Shouse" or "Barndominium" applies. But these "alternative" designs are in a very broad range and one reason I am so serious about the cost as a proxy for quality. That was the gist of my old class I taught years ago on building design. It is all about the frame and the foundation as well as the materials and design.

 

[rolco]

I think that is a key element. My nephew's house was comparable in cost to other traditional housing around. But I've seen some houses that are costing 30% less. The construction techniques are the heart of it. If the building is post & pier, floating slab foundation, minimalist interior, maybe even a colored concrete finish and no floor covering per se, perhaps "Shouse" or "Barndominium" applies. But these "alternative" designs are in a very broad range and one reason I am so serious about the cost as a proxy for quality. That was the gist of my old class I taught years ago on building design. It is all about the frame and the foundation as well as the materials and design.

This gets down to the root of my question. It's not so much about the valuation as it is the semantics of design.

I am not aware of any formal definition for a "shouse". The lender is telling me that FM will not insure a "shouse" and has asked that I do not identify it as one within my report. Locally, my subject is what is referred to as a shouse. I have a problem calling it something else just to appease the lender. However, I also prefer not to turn away assignments away over semantics, especially for good clients.

I gave two examples of what folks may refer to as a shouse within the market. My subject is more similar to the first example. I certainly would not call the one Terrel posted a shouse, but rather a ranch home with a metal exterior.

I've asked the lender to provide me with the guidance they are getting from FM regrading shouse design homes, but so far its been crickets. Is there such guidance?

Most shouses in my market area are of stick frame on slab foundations with minimal exterior ornamentation. Larger garages that are nearly equal to the foot print of the living area. All clad metal exterior. Lower interior finish costs. I did appraise one several years ago that was pre-engineered steel frame with sub-slab radiant floor heat, and high end interior finish. From the outside you would have never known whether it was a shed or a SFR. This was a for a conventional refi that stayed in-house so there were no underwriting limitations.

 

[sputnam]

As appraisers, it's really none of our business whether Fannie/Freddie will insure a loan on a particular property or not. Out job is to form and report an opinion of value in compliance with USPAP and other regulations. I agree that the question is more about 'style' than about whether it's a house or not.

 

[Peter LeQuire]

I appraised more than a couple of barns with human living units in them - while there was some, albeit limited data on similar properties, none of them were eligible for secondary market financing.

 

[Proactive]

I wouldn't use a localized descriptor of "shouse" because that style is not on the lender's checklist. They don't know what to do with a shouse (nor would I, as I've never heard of it until this thread). I would use a recognized Design/Style name (Ranch works for me on either of these two homes) and let my photos and in-depth narrative go into the details.

Good luck!