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This is somewhat of an idle question; I've no intention of selling. But the subject came up about a year ago and we were stymied.
We built this place in the Poconos in 1999. It's on a 6.1 acre lot on a mountainside, going down to a beautiful creek - it'd be considered a river in a lot of places. Deep enough to dive into; navigable to the Delaware River about 5-7 miles away.
Our lot is a flag lot, an irregular, kind of triangular property -- the creek frontage is almost a thousand feet. The property is heavily forested and has greenbelt to the south across the creek, so no building there. The western edge is a 500-acre preserved-in-perpetuity Boy Scout reservation, so no building there. And we own the two undeveloped northern lots, an acre each. So we cannot see any neighbors in summer, and barely in winter, with no leaves on trees. It's a cul de sac, so no traffic to speak of either.
But it's in a development, with an HOA, and most lots are more-standard subdivision size, a half-acre or less, some bigger.
The house - raised ranch, but because the bottom floor is hard up against the side of the mountain -- walkout front and sides, but back is below grade -- we were told at the initial building time appraisal that the bottom floor is considered basement and can't be counted in terms of sq. footage. We disagreed mightily with that assessment, but whatever. It's weird -- house is considered 4 br, 2.5 bath, but two of those bedrooms and a bathroom are on the bottom level, so how can they count that and not count the sq. footage down there? Anyway....that's how the stats supposedly shake out.
It's cedar siding, two decks, two-car garage, cathedral prow front wall-o-windows living room, etc etc, very nice by late 90s standards, but hasn't been updated since then, other than routine maintenance.
There is NO comp anywhere around here that I know of. Nobody has our acreage and our creek frontage. The house was a custom build, so while it's a standard type of house, it's not like the builder put others like it anywhere.
How would we go about getting an accurate appraisal if we needed to?
You would get an appraiser if you were selling or refinancing.
They will find comps. If you have the nicest house in town, you will always be disappointed in the comps.
You can pay for an appraiser regardless of buying or selling or refinancing. The appraisal will be one persons opinion. I'd be shocked to you paid for two independent appraisals and received close to the same number if the property is truly unique.
Oh, it's nowhere close to the nicest house in town
It's the property that's unique, that's all. And I don't know how anyone figures a value on it, I guess.
Finding an appraiser to do this complex property likely won't be a problem. Given a good fee to cover expenses and time plus having adequate time to do the required research and analysis, any competent appraiser can complete a credible appraisal on virtually any residence.
The hard part might be finding a lender. Unless it's a portfolio loan (kept in-house by the lender and not sold on the secondary market), lenders really, really, really hate "unique" properties. Portfolio loans can have some very interesting underwriting conditions. Unique properties normally sell to unique (or niche) buyers. Remember that, if the homeowner defaults on the loan, the lender/bank needs to sell that property to recoup their loan investment. Looking for another niche buyer for that property can be a long process.
As for the basement not being included in Gross Living Area, that's pretty standard stuff. ANZI standards and GSE guidance rule out using "below grade" areas as GLA. It does have value (based upon your market) so it would be valued as a separate entry on the appraisal report but it isn't GLA.
Our original lender is still our lender; community bank and we like being on a first-name basis. I guess we are already a portfolio loan then.
So basement can be not included in GLA but assets of basement can count separately, huh? That's interesting....and annoying
You'd think the lower sq. footage would have lowered our tax bill but it doesn't seem to have helped, unfortunately. We're on a par with 2400 sq foot houses around us (which is what ours would be if lower level were included).
Your premise is that there "aren't any comps" to your property. Within your knowledge base, that can be the case.
But a pro appraiser will cast a larger search net with their resources than you have to find houses and properties that are effectively comparable. Likely there will have to be adjustments, such as number of bedrooms, fixtures, sq footage, etc.
The difference is that a pro appraiser works at a different level than you. They look at a cost basis, replacement value, and market value approach to give a foundation to a professionally defensible appraisal. They have guidelines psf of similar construction, architectural features, condition, etc., to research and evaluate.
Intrinsic values ... such as having a view, access to water ... cannot possibly be absolutely unique to only your property in the area. Other properties will have these things, although perhaps not in the exact combination that your property has.
Consider, too, that while you place a high value on having so much more land than is typical in your subdivision, others might look upon that as a burden to fence/maintain/pay property taxes on, etc. That's what a pro appraiser's job is all about ... evaluating the marketplace to establish that FMV for your property.
In your area do you get assessment increases and are prices based on assessments? Some places they are; some places prices are way higher than assessments and have little to do with assessments, moreso on what's called "fair market value".
You property sounds wonderful. Maybe for an artist of some sort as a getaway from one of the cities.
I know properties like that where I have figured there was a rule of thumb of a certain percentage over assessment for what they sold for.
I know others where the owners put a high price on the house, higher than others on the street, at least twice as high as others without the good lot. The good lot being a point lot on water or lake plus mountain view. And people from the bigger cities came and paid all cash with no appraisal. The deal was great compared to what they were used to in the bigger cities but the buyers were also not stupid and realized the price was also right for the area.
You can fool around with some of this.
How many homes in your community? Does having them so close take away from the feel of your place as you drive in the community or is it all winding roads and lots of trees? I'm thinking of a community near me with homes on 1/4 acre lots but somehow someone got a back lot with 6 acres when the community was established. He's fine with it.
FYI, views sell better. If a community has houses with views of woods, mountains and lake and the house is the same otherwise, water is the first draw. What's your view?
Some people will pay cash for things in a getaway (whether weekend or fulltime) that cannot be appraised...like glorious sunsets.
Thanks very much for the insights, sunsprit. It'd be an interesting exercise. Maybe when we have a spare $300-500 lying around
Why? Whats the point? An increase in mortgage interest rates will totally change the market and your comps. So the appraisal will be out of date the next day.
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