Waterfront property on vacant land & subject on the other lot

[rnappi]

I have an FHA appraisal that has the subject on one lot and across the street is a vacant lot that is on waterfront with the bulkhead. They are selling both the lots together and calling it waterfront. Do I just add the two lots together? Sorry never ran into one like this can someone help, please?

 

[Michigan CG]

Start with Highest and Best Use and concentrate on Maximum Productivity.

And then you might want to double your fee.

 

[Terrel L. Shields]

Hmm.... Having access to the waterfront is a bonus to the lot that is not on the waterfront...so, I'd lean to the notion that it would be like a waterfront lot with X amount of frontage and similar size otherwise....what's a little road to come between you and your boat?

 

[J Grant]

Is the vacant lot across the street buildable and able to be sold seperately? If it is, imo, you might have a problem, what if the owner decides to sell the vacant waterfront lot in the future? Then you have a home on one lot that is no longer waterfront. Or is the lot across the street non buildable and deeded r with the subject and the built out subject lot?

Here in FL we have some homes on a main lot, with a strip of waterfront land across the street, but the strip is a narrow piece of land either beachfront or deepwater with a dock and can't be built on, and is deeded with house, therefore I combine the sf of lots. Ask owner if the wf lot is deeded with the house and ask to get a copy of the deed.

 

[Mary Tiernan]

In my area, there could be a market reaction to the "across the street" burden on the house, but only a review of sales can determine that for you.

As to your specific question:

I would definitely ask my client before I proceed . . . but you probably need to have a few questions answered before asking for direction:

are the lots deeded together or separately? can they be combined? could you do a 'subject to' report - based on the lots being combined? was the house built, then the waterfront lot purchased or were the two lots purchased together originally? was the house built in its current location due to zoning/flood issues?

once you have all the answers, provide client with the facts and give them options on how the report can be completed.

 

[J Grant]

Mary's post contains a lot of good points.

Im my market, usually there are one or two comps of deeded land across the road, and yes, in comparison to direct beach or deepwater lots with no road, there is often a market reaction. If you can find a similar comp with road between the wf and main house and lot, that is best of course.

 

[Sid Holderly]

In my area the extra lot is sometimes the leach field for the property and must sell with the property to be a valid residence. If the extra lot is not needed and it is buildable it has buildable watefront lot value and if it is not buildable it has view and access value as an excess lot. Some times if the extra lot is needed to go along with the house lot a note on the property card for each will refer to the other.

 

[Terrel L. Shields]

I don't see whether it be buildable or not a real value issue. If it was sold, obviously the other lot is badly devalued... If a frog had a pocket to carry a pistol in, he'd not be afraid of snakes... Is v. what might happen in the future

 

[Walter Kirk]

The situation that you describe is not uncommon in N.J. You must determine whether the waterfront lot is indeed a stand alone lot or a portion of the lot that the improvements stand on with a road easement.

I would look for historical sales of similar properties to determine an adjustment.

 

[Scott R Marshall]

I can post the comment received directly from HUD but if the lot across the street is under a separate parcel number from the subject, then it cannot be included in the appraisal if it is going this route. If its conventional that is something else entirely.