Unpermitted Accessory Dwelling Unit Issue

[cstu11]

Need some advice since I have received several revision requests asking me to call it a permitted ADU on the grid and include a permitted ADU comp.

The subject was permitted as a rec room with a half bath. The owner put in two bedrooms, a full bathroom, and a kitchen without a permit (no certificate of occupancy so it cannot be legally rented). In my report, I described it accurately and included a comp that is permitted as a rec room like the subject, giving no value for the unpermitted kitchen.

The issue is that the reviewer is wanting me to call it a permitted ADU in the report and find a comparable with a permitted ADU. I believe this would be unethical because the value of a rec room with an unpermitted kitchen has much less value in the market than a permitted ADU which can be legally rented out. If I were to use the reviewer's logic then any garage that someone puts a kitchen and bathroom into without permit needs to be valued the same as a permitted ADU.

What are you thoughts?

 

[Joe Flacco]

Do they want you to acknowledge the adu or specifically write "permitted adu"?

It doesn't have to have its own co and be rentable to be an adu.

 

[Tawfik Ahdab]

I just had that situation occur last month. The detached studio with separate bathroom had an unpermitted kitchen. You can tell a kitchen in an area lacking natural gas or propane service when the stove requires a 220 V outlet. And in my case, the listing agent never called it an ADU, but a detached unit, as though that would magically wipe out the illegal status of the existing ADU setup.

Since the jurisdiction requires strict adherence to recently enacted regulations for ADUs in the local market area, and since the second unit was permitted only as a family room with bathroom, I could not endorse calling the unit an ADU. In fact, I made the appraisal subject to removal of the range /oven in the illegal kitchen as well as disabling or removal of the 220 V electrical outlet feeding the electric range/oven.

As long as you document the identity, telephone number or email address, the position, and the time and date of your communication with the authoritative contact , you will be golden.

The other alternative would be make the appraisal subject to compliance with the requirements to be designated a legal ADU. Only then could you even consider it an accessory dwelling unit. From there, let the chips fall where they may.

 

[Joe Flacco]

This is an ADU. We are not the permit police.

 

[Fernando]

I came across such a situation years ago in which reviewer requested me to call this modified room area as an ADU.
I disagreed but followed what the reviewer wanted. I thought it must be a new Fannie thing.
Fortunately, I never had to deal with a follow up to the amended appraisal.

 

[Joe Flacco]

Is an ADU (or a second unit subordinate to the primary dwelling) allowed under current zoning?

It does not say anything about permits. It goes on to say not allowed under zoning = Not allowed under any circumstance.

 

[Fernando]

View attachment 107921

Is an ADU (or a second unit subordinate to the primary dwelling) allowed under current zoning?

It does not say anything about permits. It goes on to say not allowed under zoning = Not allowed under any circumstance.

In CA, all homes regardless of existing zoning are allowed to have ADUs.
It's the political environment encouraging increase in housing stock.

 

[Trihard]

The reviewer is trying to help you out.

 

[Surf Cat]

What are you thoughts?

You have a rec room converted into an ADU. At least the rec room is legally permitted. I'd include a legal ADU & a non-permitted ADU sale in the grid to show market acceptance. I would not call the rec room a legal ADU. Rather, a non-permitted conversation through explanation.

 

[sputnam]

Need some advice since I have received several revision requests asking me to call it a permitted ADU on the grid and include a permitted ADU comp.

The subject was permitted as a rec room with a half bath. The owner put in two bedrooms, a full bathroom, and a kitchen without a permit (no certificate of occupancy so it cannot be legally rented). In my report, I described it accurately and included a comp that is permitted as a rec room like the subject, giving no value for the unpermitted kitchen.

The issue is that the reviewer is wanting me to call it a permitted ADU in the report and find a comparable with a permitted ADU. I believe this would be unethical because the value of a rec room with an unpermitted kitchen has much less value in the market than a permitted ADU which can be legally rented out. If I were to use the reviewer's logic then any garage that someone puts a kitchen and bathroom into without permit needs to be valued the same as a permitted ADU.

What are you thoughts?

You can not report it as permitted if it is unpermitted. However, your job is to develop and report the value, as defined, of the subject property. Your job doesn't include being a code enforcement officer. You can certainly break out the contributory value, if any, of the ADU in such a way that the Client can use the information to make their own decisions.