Water and water rights in northern NM

[Learner]

Thanks

Thanks to all

No no no no no...

There are two types of water....
Saltwater and freshwater.

Funny. I do seem to have a layer of salt water down there a ways. My salt bush does very well.

 

[Lobo Fan]

Appraising water rights is outside the scope of a residential appraiser. Whenever I encounter such a situation I defer to a CG such as PE with real experience in dealing with these matters. Plus, no AMC would want to pay for the time it would take to properly research and document water rights.

 

[Michael S]

The few sales of water rights I've seen (Santa Fe area) have been on the order of $10,000-30,000 per acre foot. The whole market for water rights is very opaque though and there's a large gap between buyers and sellers in most cases. I've seen older sales (90's) that were around $50,000 or more.

It all comes down to supply and demand in that particular basin. Water rights further upstream are generally more valuable as there's a larger number of potential buyers.

 

[Learner]

Again, thanks to all.

Michael, I have seen numbers similar to those you present.

Talking to peoplenin Nambe, I get the impression that most are just not interested in buying any more water rights even here which is upstream. Most let their grounds go natural. And trees seem to do fine without irrigation Unless they have horses, they really don't need much water.

Thanks again.

 

[KD247]

... Talking to peoplenin Nambe, I get the impression that most are just not interested in buying any more water rights...

Was this the basis for all of your threads with nebulous appraisal questions? I'm sure that those who put careful thought into your questions would have appreciated knowing the details earlier in the game.

... Did it even affect value if the buyer was equally ignorant?

Water rights provide a good example of how current residential appraisal methods (form based) fall apart when applied to anything but typical properties. A better methodology would be one that gives the appraiser some latitude in deciding (given a specific subject property and the reason for the appraisal) the required scope and the most appropriate way to report the opinion.

The water rights question reminds me of the beer question (from another thread, Would you buy $4 beer delivered, $2 beer at a bar, or $1 beer at the store?) except, to make it more like the water rights question, the buyer would be a vacationing alcoholic; where the lack of a beer would be more than an inconvenience, it would be catastrophic.

I can't imagine offering an opinion of value for water rights without also commenting on the fact that they are not guaranteed to be permanent and that loss of water would drastically reduce the value of the property. I'm really not sure how one could describe the risk involved but it couldn't be adequately expressed in terms of a value range.

 

[Learner]

"Was this the basis for all of your threads with nebulous appraisal questions? I'm sure that those who put careful thought into your questions would have appreciated knowing the details earlier in the game."

Each thread was based on a specific question that I had. I regret that you found them nebulous.

Thank you for your response to this question.

 

[KD247]

... Each thread was based on a specific question that I had. I regret that you found them nebulous. ...

Hey, we're all friends here, even when we disagree.

I'm just curious about your general objectives - and not because I'm looking to criticize but because I'm genuinely interested in hearing where you're going with all this. If it's simple intellectual curiosity, glad to join you in a discussion. If you're looking for negotiation tools, that makes it even more interesting. But if you're gathering attack points for a lawsuit you're preparing, that should be disclosed.

Looking back at some of your earlier posts, I can see that I jumped in about halfway through your questions. But the fact that you have such diverse questions that all pertain to a single property leads back to one of my original comments regarding whether it's realistic to look at real estate values as the sum of the values of individual components of the property. And, whether a single-point valuation has any relevance at all in a broad discussion of valuations of unique properties.

Participating in this forum doesn't qualify as continuing education, but it's one way to stay abreast of current appraisal topics and a great place to discuss and explore appraisal concepts. That's why we're here, it's certainly not because we're being paid for this.

 

[Learner]

Again, I have not made myself understood.

I was in no way ever in my entire life hurt by an appraisal -- never lost a penny. The most recent appraisal I received might have reduced my cash out on a refinancing, but the bank insisted that I take every penny I had asked for and reduced my closing costs.

Thus have nothing to appeal, contest, or sue about.

I am a retired analyst who did analysis for the Executive Office of the President, the Department of Energy, the Department of the Army, the Mayor of Atlanta, the Space Agency, and the Virginia Small Business Development Center.

I am currently interested in appraisal and assessment and want to learn more. I may someday write something about it. I ask questions here to learn from people who actually do assessments. And I hope their answers can help keep me from making an utter fool of myself if I publish something.

I have never utilized multiple regression in a single analysis -- but do not rule it out as an appropriate tool depending upon the specifics of an analysis.

Incidentally, I blind lucked into my current home which among other virtues continued to appreciate in value even as others in other locations across the US took heavy losses.

 

[KD247]

...Incidentally, I blind lucked into my current home which among other virtues continued to appreciate in value... .

Not very many people will admit that. Most people like to think that good fortune was their own doing and that bad fortune is the result of an unfair world. Sounds like you're the type of person who nurtured his fortune by throwing in a lot of hard work - it's nice to hear about a good guy winning!

Anyway, I was hoping that you would reply in the way you did. There's certainly quite a bit that we could learn from you, perhaps to the betterment of the appraisal industry.


www.ForecastingPrinciples.com Are you familiar with this Forecasting Principles website? I personally dislike the term "Ahah Moment" but I can't think of a better way to describe how I felt when I found their Forecasting Methods Selection Tree

After years of studying statistics and methodology in school, conventional appraisal theory seemed to contradict everything I had learned. (I think it's primarily due to people in the lending industry who prefer buzzwords over technique.) Anyway, here's some more reading you might enjoy,
Formula the Killed Wall Street

Ooops, there's the phone. Gotta run.

 

[Learner]

Thanks for the links but I have never been a forecaster except on very specific questions and I never used even simple correlation for that.

I think of myself as an analyist -- one who looks at the much easier question of what is, rather than what will be.

As far as the great housing boom and bust -- I can only say that I asked the right question at the time (but did not publish it.)

The question: how can you take a bunch of incredibly bad mortgages and bundle them into a good security?

Answer: you can't.

My concerns are much more mundane, limited, specific. I'll post my next question.