Very short term rental...

[alebrewer]

Glenn is correct - the topic of the thread is a 2-unit where one side is OO and the other side, airbnb. The comments about SF detached were only presented to show the flaw in Terrel's logic. To Glenn's point, the Fannie section on rental income might be a good resource (Section B3-3.1-08), as it discusses qualifying a borrower's rental income. If, however, the borrower isn't using the income to qualify, it's my understanding that whether it's an airbnb, or a long term rental - doesn't matter.

Regarding the pilot program Glenn mentioned, I think it only applies to primary residence, and for refinance, but that may apply to 2-family where one side is OO. Just not sure about that. Again - best plan is to discuss the situation with your client to ensure that it's an eligible property, and to proceed from there.

 

[J Grant]

Glenn is correct - the topic of the thread is a 2-unit where one side is OO and the other side, airbnb. The comments about SF detached were only presented to show the flaw in Terrel's logic. To Glenn's point, the Fannie section on rental income might be a good resource (Section B3-3.1-08), as it discusses qualifying a borrower's rental income. If, however, the borrower isn't using the income to qualify, it's my understanding that whether it's an airbnb, or a long term rental - doesn't matter.

Regarding the pilot program Glenn mentioned, I think it only applies to primary residence, and for refinance, but that may apply to 2-family where one side is OO. Just not sure about that. Again - best plan is to discuss the situation with your client to ensure that it's an eligible property, and to proceed from there.

Really ? So if one side of a 2 unit is vacant on eff date, you say one the property half vacant for analysis and give that side zero $ in market rent?

Read what Glenn actually posted, it is fannieUW qualification of borrower income if borrower rents an air bnb , it has nothing to do with the property or how the property should be appraised. We appraise small income units for market rent in area, and many clients if there are seasonal rentals or air bnb still want the property rents from annual only, since the property is a res income property, not a hotel/motel use.

If at a certain point zoning changes allow a property to be hotel/motel or the property gets re configured into a number of small rooms for airbnb/short term rentals that affects the property.

The rest is about income for borrower. I run my appraisal office out of my home, it does not turn my house into commercial use. Move my computer and printer out of my "office" and it reverts to a den. My appraisal use of home relates to my income as an appraiser , but it does not change the use of my property .

 

[alebrewer]

Really ? So if one side of a 2 unit is vacant on eff date, you say one the property half vacant for analysis and give that side zero $ in market rent?

Read what Glenn actually posted, it is fannieUW qualification of borrower income if borrower rents an air bnb , it has nothing to do with the property or how the property should be appraised. We appraise small income units for market rent in area, and many clients if there are seasonal rentals or air bnb still want the property rents from annual only, since the property is a res income property, not a hotel/motel use.

If at a certain point zoning changes allow a property to be hotel/motel or the property gets re configured into a number of small rooms for airbnb/short term rentals that affects the property.

The rest is about income for borrower. I run my appraisal office out of my home, it does not turn my house into commercial use. Move my computer and printer out of my "office" and it reverts to a den. My appraisal use of home relates to my income as an appraiser , but it does not change the use of my property .

Before you go off on me, J, please ask for clarification on what I said Glenn was correct about. He is correct that the post is about a 2-family, not a SF detached.

 

[Terrel L. Shields]

Property Eligibility
Q1. In the list of ineligible properties, boarding houses are identified as an ineligible property type. Is a group
home considered to be a boarding house and therefore an ineligible property type?
No. Group homes are residential structures utilized for occupancy by persons with disabilities and are not
considered to be boarding houses. Group homes are an eligible property type according to the
requirements of the Selling Guide.
Q2. Why are boarding houses and bed and breakfast properties considered to be an ineligible property type?
Fannie Mae purchases and securitizes mortgage loans secured only by properties that are primarily
residential in nature. Boarding houses and bed and breakfast properties are not primarily residential in
nature and therefore are not eligible.

Catch 22, which elements apply using fannies own words?

 

[alebrewer]

Really ? So if one side of a 2 unit is vacant on eff date, you say one the property half vacant for analysis and give that side zero $ in market rent?

Not sure how you made this leap from my post, but hopefully you know me better than that.

 

[alebrewer]

Property Eligibility
Q1. In the list of ineligible properties, boarding houses are identified as an ineligible property type. Is a group
home considered to be a boarding house and therefore an ineligible property type?
No. Group homes are residential structures utilized for occupancy by persons with disabilities and are not
considered to be boarding houses. Group homes are an eligible property type according to the
requirements of the Selling Guide.
Q2. Why are boarding houses and bed and breakfast properties considered to be an ineligible property type?
Fannie Mae purchases and securitizes mortgage loans secured only by properties that are primarily
residential in nature. Boarding houses and bed and breakfast properties are not primarily residential in
nature and therefore are not eligible.

Catch 22, which elements apply using fannies own words?

Quick question - how did we go from 2-family to boarding houses and b&b's, Terrel?

 

[J Grant]

Before you go off on me, J, please ask for clarification on what I said Glenn was correct about. He is correct that the post is about a 2-family, not a SF detached.

Sorry, did not mean to go off on you, just that Glenn was incorrect about airbnb for fannie acceptance is about the property. The fannie airbnb program relates to borrower allowed to use income from airbng to qualify them for a loan

Glenn was correct that post was about a 2 family (or more units ), which was never in question, at least not by me...the OP did not ask about a SF detached, they asked about how an ADU is treated when it is present on a multi unit property. (it may not be a ADU, may be just an additional rental unit even if physically it is a detaches building with house character.

 

[alebrewer]

Glenn was correct that post was about a 2 family (or more units ), which was never in question, at least not by me...the OP did not ask about a SF detached, they asked about how an ADU is treated when it is present on a multi unit property. (it may not be a ADU, may be just an additional rental unit even if physically it is a detaches building with house character.

So if you'll take the time to read my response to Glenn, I specifically said the comments about SFD were only to point out the flaw in Terrel's logic. No one's talking about SFD actually being part of this discussion...

 

[alebrewer]

they asked about how an ADU is treated when it is present on a multi unit property. (it may not be a ADU, may be just an additional rental unit even if physically it is a detaches building with house character.

if it's a 2-family, by definition it's not an ADU... I don't think that's ever been in question.

 

[J Grant]

Imo the ironic part is that while Fannie program now allows a borrower to use airbnb income to qualify for a loan, I doubt fannie accepts the property itself if it is appraised as a hotel like "airbnb use". They still (I bet) want it appraised as a residential use small income property with market rents from annual or typical longer term leases in area. Appraisers should check with lender client but that is my understanding about differentiating between property eligibility vs borrower income eligibility.

How a borrower using a residential rental property for airbnb use affects their homeowner insurance is a borrower insurance issue, not an appraisal issue.