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Our house sits in the middle of 25 acres with a 6 acre lake. A fishing pier is about 20 yards from our back door. Appraisers just appraise the house and acreage but don't even consider the lake.
I'm thinking banks don't want to finance more than just the value of the house so other features of the property are not considered.
When we bought the property years ago we paid $10,000 over the appraised value because of the lake.
I want to know how much we should add to the appraisal when selling. Any ideas?
When we had our house appraised, which stood among very few others atop a beautiful mountain in eastern PA, we were disappointed to learn that all the comparables were in the city at the bottom of the mountain, even though they were all within a mile radius of our house.
Mortgages in my area take into account the amount of land that comes with the home purpose
Land in some areas of course is worth more than land in other areas
Many people/builders buy older homes strictly for tear downs and in those areas the value of the home is negligible compared to the value of the land
You can hire an approved/certified appraiser to value your home yourself
The fact that you were willing to pay above asking price when YOU bought really cuts no ice with a valuation done on market value/comps
We paid above appraised value for house we have (not on a lake) because it had certain design factors that cut no extra weight w/an appraisal—like the privacy factor in the back yard and the engineered foundation vs builder slab—and the owner would not come down
But the facts are that any foundation that is not damaged counts the same as any other type of foundation to an appraiser—no matter if one is more expensive to build
There is no + appraisal value given to a backyard that has no “overlook” by other homes just as there is no negative factor for a backyard bordering a strip mall
Even though the BUYERS may discount that factor when making an offer—if they make one
Why would you pay over appraised value unless there were competing bids for the property?
People make offers over appraised value when there is competition and/or the listing was made with a deliberately low price to gain market attention...
When we had our house appraised, which stood among very few others atop a beautiful mountain in eastern PA, we were disappointed to learn that all the comparables were in the city at the bottom of the mountain, even though they were all within a mile radius of our house.
That's the problem with comps. There is no comparable property. There may be similar houses but they don't have the lake and hiking trails.
From my perspective, lakes and other water bodies are one of those things that people either want or they don't. Very much like hot tubs and pools. I know that we passed up on a property with a small creek a few hundred feet from the house. There were a couple reasons, but having small children was the deciding factor.
To me, a lake 20 yards from my back door is a liability. It would also attract mosquitoes and potentially stink in the right circumstances. Others may consider that the crowning feature of the lot, and fall all over themselves to make an offer.
TLDR - not everyone considers a lake that close to a house a benefit worth paying more for. I can see why it would not be added to an appraised value.
It depends on how many nice lakes are around your area. In my arid area, having your own 6-acre lake on 25 acres would make it highly desirable and very valuable, assuming it is not just a mucky cattle watering hole. Heck, even those are touted as desirable here.
Waterfront properties, and properties with large acreages and nice views are very definitely adjusted in value to reflect those features, at least in our area. How much varies widely... There isn't just one answer for that.
You are right that comps are hard to find, but you will probably find the acreage and the view/amenities as an adjustment within the appraisal, adding or subtracting from similar homes with or without those features. Look for it... appraisals are not easy to read and it can be hard to understand the form of the report.
They may not value it as highly as you do... but that is, again, part of the art and science of marketing unusual properties. You typically don't want to market it for much higher than appraised value, unless you want to be limited to ONLY cash buyers. If people need financing, they will need for an appraiser to agree on the value. That can be the challenge.
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