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Single wide that provides no contributory value... but

jturner01

Thread Starter
Junior Member
Joined
May 13, 2008
Professional Status
Certified Residential Appraiser
State
Florida
Good morning everyone, I attempted to do some research about something like this, but found nothing. A client contacted me about a single wide in a rural area that is in bad shape and provides no contributory value to the property. The lender was not really concerned about that, they want to know the land value (it is 26+ acres) and this is believed to be enough to secure the funding on the home. I did my research and head out to the property and meet the owner, he takes me all around the property and then I go to the "house" and it was probable a C5 home, but there was one issue, there is some mold in one of the bathrooms. How do I write this up? I want to make sure that I disclose all of this, and not mislead anyone. Truth be told, I am afraid that the owner is just going to fix it up and rent it after securing the funding and I want no part of that liability. What is the best way to approach this? Subject to remediation, but if I am not giving it any value, does that really take that into account? Should I subtract the cost to raze the structure? Would you reach out to the client to ask them how they would like you to proceed?

As always, thank you for your help it is greatly appreciated.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Good morning everyone, I attempted to do some research about something like this, but found nothing. A client contacted me about a single wide in a rural area that is in bad shape and provides no contributory value to the property. The lender was not really concerned about that, they want to know the land value (it is 26+ acres) and this is believed to be enough to secure the funding on the home. I did my research and head out to the property and meet the owner, he takes me all around the property and then I go to the "house" and it was probable a C5 home, but there was one issue, there is some mold in one of the bathrooms. How do I write this up? I want to make sure that I disclose all of this, and not mislead anyone. Truth be told, I am afraid that the owner is just going to fix it up and rent it after securing the funding and I want no part of that liability. What is the best way to approach this? Subject to remediation, but if I am not giving it any value, does that really take that into account? Should I subtract the cost to raze the structure? Would you reach out to the client to ask them how they would like you to proceed?

As always, thank you for your help it is greatly appreciated.
You are not responsible for what happens to a property after we appraise it ( or lender funds it ) Maybe they will cook meth in the house ? Or use it for storage ? Who knows ...all we can do is disclose what it there day of inspection. If it were leaching toxic chemicals into the soil I'd make it subject to demolition/remediation. But it is not at present a health/safety threat to the or property.

You say it is not contributing to value -is or is not habitable and is it accorded any value? WRT the observed/ suspected mold is in one bathroom, you can either make it subject to inspect for mold or just disclose there is mold observed and recommend inspection.
 

spittman le berger

Senior Member
Joined
Oct 24, 2005
Professional Status
Certified Residential Appraiser
State
Texas
Seems like you already know what to do. The client has already told you they don't care about the home. They just want to know how much the land is so you can probably do Subject to "hypothetical condition" and deduct cost of removing the manufactured home. Is the the towing hitch still attached and foundation made permanent? Are you able to find other comps with manufactured homes in similar shape? I'd use a vacant land sale as Comp #4 to support your value. And I always use a disclaimer for "mold-like" stains because I am not an expert unless it looks like it has spread and taken over the property.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Is it being done as a land appraisal?
 

Tawfik Ahdab

Senior Member
Joined
Feb 19, 2003
Professional Status
Certified Residential Appraiser
State
Oregon
So if you’re saying that the improvements contribute nothing to value then the highest and best use of the site is to build new upon. In that case (and I’ve done many of these before), I use the land appraisal form and enter A one line item titled “improvements.”

Based on that one line item, I can use both vacant land/site sales as well as sales of properties With decrepit improvements or improvements without contributory value. On that line item also I can estimate or use an approximation of the cost to demolish and remove those improvements as applicable, and adjust accordingly. It often costs more to tow an old mobile/manufactured home away than to simply demolish the old improvements on site and haul them off.

I hope that helps but again discussion with your client is essential here.

Once you’ve stated that the improvements have no contributory value your Highest and best use analysis is of the land/site as vacant.
 

BRCJR

Senior Member
Gold Supporting Member
Joined
Sep 20, 2005
Professional Status
Licensed Appraiser
State
Virginia
First, is the improvement personal property or real property?
Second, indicate there is a "mold like" substance in the bath and provide a picture.

From what is described I would probably do this as a land summary with the "little to no contributory value" assigned to the improvements, if in fact that is found to be true.
 

glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
Its a land loan, who secures a single wide for collateral ? Two Red Necks and a F-350 can put the wheels back on that bad boy and tow it to another site :)
 

George Hatch

Elite Member
Gold Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
California
There's no hypothetical involved. If the property is worth more as land than as a residence then you're appraising land with *maybe* some cost to cure if you think the market for such parcels is even making such a distinction. What's the cost of demo/haul off? It's probably not much, although you might have to pay extra for the crew to wear breathing protection.
 

glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
There's no hypothetical involved. If the property is worth more as land than as a residence then you're appraising land with *maybe* some cost to cure if you think the market for such parcels is even making such a distinction. What's the cost of demo/haul off? It's probably not much, although you might have to pay extra for the crew to wear breathing protection.
George crews that haul off single wide's don't need any breathing protection, between 3 packs a day of Marlborough Reds and a gallon of jack Daniels those boys have lungs that will withstand anything :)
 
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