Using MH as a comp

[norapp]

My subject is in a rural area along the NY/Vermont border. There is a village within 5 miles that shares same school district. There is a very distinct difference in the 2 areas (one rural & one suburban). Typically, a buyer in the village which has lower values than there is for a buyer in the rural locale. More secondary vacation homes in the rural locale. The village houses many correctional officers at the nearby state prison. They just announced the prison would be closing in November which means lots of relocations. My question is this. I used 2 stick-built homes and 1 manufactured home as comps in the rural area. Lender also wanted 2 listings and manufactured homes were the only available listings. Lender is very unhappy with the choice of comps and is demanding I use comps in the village. They stated I can't use MH because it is a different type of ownership. Not sure if there is any rule that says you cannot use MH for a comp.

 

[Vermonter]

I've done it. Definitely not ideal. Most times I will just go out further to find similar sales from a similar rural area, but if you're talking Great Meadow and Whitehall area, you're kinda limited.

I do not know your market at all, but maybe the other side of Lake George equidistant from Albany and I-87?

 

[norapp]

I've done it. Definitely not ideal. Most times I will just go out further to find similar sales from a similar rural area, but if you're talking Great Meadow and Whitehall area, you're kinda limited.

I do not know your market at all, but maybe the other side of Lake George equidistant from Albany and I-87?

That is the locale. So, I can use MH if no other sales in the rural area? Can I mention the prison closing? Big impact on market.

 

[Vermonter]

That is the locale. So, I can use MH if no other sales in the rural area? Can I mention the prison closing? Big impact on market.

You can use anything, the question is how will the lender respond to it? In my case I used the MH as #4 comp but gave it greater consideration in the Final Reconciliation than 2 of my 3 stick build comps on page 2. Explanation is key.

If the market is reacting to the closure announcement and you can document it that would explain your use of location specific comps even if they aren't as comparable as others further out.

 

[Dublin ohio]

They stated I can't use MH because it is a different type of ownership

The above doesn't makes sense unless the mfg home is not classified as real estate

 

[J Grant]

My subject is in a rural area along the NY/Vermont border. There is a village within 5 miles that shares same school district. There is a very distinct difference in the 2 areas (one rural & one suburban). Typically, a buyer in the village which has lower values than there is for a buyer in the rural locale. More secondary vacation homes in the rural locale. The village houses many correctional officers at the nearby state prison. They just announced the prison would be closing in November which means lots of relocations. My question is this. I used 2 stick-built homes and 1 manufactured home as comps in the rural area. Lender also wanted 2 listings and manufactured homes were the only available listings. Lender is very unhappy with the choice of comps and is demanding I use comps in the village. They stated I can't use MH because it is a different type of ownership. Not sure if there is any rule that says you cannot use MH for a comp.

Leave the comps you already have in teh appraisal, add a sale in the village and adjust it down for location. The value will remain the same.

If an MH is a real property and has a similar level of construction to stick build, idk what their objection is. That said, I often use an older sale over a year or six months as a comp - some appraisers seem adverse to that - older than a year it is a fourth comp.

 

[Tom D]

i like grant's solutions.
no civilian can tell the difference from a manufactured house to a stick built house. you have to know what to look for.
they are the both types of the same house sold and listings. why are you looking at them differently. on the grid there is no concern, or adjustment line, for stick vs manuf built.
imagine building stick in a rural area. how far away are the contractors and supplies needed to do this. manuf is quality and more cost effective out there.
lender is subliminally saying your value is to low, without being too obvious.

 

[Terrel L. Shields]

Not sure if there is any rule that says you cannot use MH for a comp.

Common sense says compare apples to apples. You have to make a quality adjustment, or you make a location adjustment. However, I am curious. Have you made a land adjustment? Here, a 4- or 5-acre lot sells much higher than a 1-acre city lot. If building costs are similar, why would houses per se sell differently? I mean it is either location or land value. And I would rather make the location adjustment or land adjustment than try to decipher the difference in the MH and stick built 'quality'. If both are in the same school district, then I cannot see any other factor but location or site value to factor in. Otherwise, use older sales but I'd stick with the stick built. I mean I know many buyers who are looking for a house reject any and all manufactured homes out of hand. They simply don't want them, period.

 

[Tom D]

t shields. city manuf row homes that were craned in level on top of level, sell for the same price here, all thing being equal.
why would rural people simple don't want them, period.
just very curious, cause i would do a city townhouse project with them.

 

[Terrel L. Shields]

no civilian can tell the difference from a manufactured house to a stick built house.
imagine building stick in a rural area. how far away are the contractors and supplies needed to do this. manuf is quality and more cost effective out there.
lender is subliminally saying your value is to low, without being too obvious.

Boy, you must be in a different market than I am. Stick homes 10 miles away are easily built. And I bet I can tell 99% of MHs for what they are. even with an addition being built. Only the occasional Pre-fab is difficult to determine they are not "stick" built. And they cost about the same and are the same quality as a stick built.