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Answers (4)
Best Answer
- Vince Curtis, "SoCal Appraiser"
- Contributions:4699
For lending purposes, the lenders urge us to be very conservative on these types of additive values. For instance, I own horses and know how much barns cost, and for me I would pay maybe twice a lender would allow a barn to be valued on a property I would buy. Similar for your example.
Its also area specific. In LA, pools add value - right ? - but not in certain parts. In Compton pools are a negative, as any Realtor there will tell you, but in Beverly Hills a $75K pool may be worth $150K though in appraisals there we may only add $35K.
Its also area specific. In LA, pools add value - right ? - but not in certain parts. In Compton pools are a negative, as any Realtor there will tell you, but in Beverly Hills a $75K pool may be worth $150K though in appraisals there we may only add $35K.
- ConnieK_Oklahoma
- Contributions:2899
It's a shame it has to work that way. But I get it. I saw one recently where they appraisal counted it. We were shocked. It worked out just fine. We just didn't expect this based on past experience.
- Dan, "the_country_hick"
- Contributions:4699
Connie, that nice shop could be an anchor around a buyers neck. If it needs a replacement roof in the next few years the buyer may be unlikely to be able to afford a new roof or to do anything but let it leak to death. In this kind of situation it (sadly) adds no value.
If that shop is a 6 bay garage in an area where only one person (this seller) has one by their house is adds very little value for the above reason.
On the other hand if someone has a real use for that shop it can be very valuable.
Years ago one house was for sale that had 3 garages. To obtain financing 1 or 2 of the garages had to be torn down ( to many). That gave the buildings negative value.
What is the zoning like? Can it be used for a commercial venture or is that not possible due to zoning or the areas economy not supporting it?
The problem with more buildings is more maintenance and money needed for them over time.
P.S. I have seen metal building rust out on the bottom. I have seen them develop a new rust color all over. What are they worth then? 5 years old is great. 25 years old is?
If that shop is a 6 bay garage in an area where only one person (this seller) has one by their house is adds very little value for the above reason.
On the other hand if someone has a real use for that shop it can be very valuable.
Years ago one house was for sale that had 3 garages. To obtain financing 1 or 2 of the garages had to be torn down ( to many). That gave the buildings negative value.
What is the zoning like? Can it be used for a commercial venture or is that not possible due to zoning or the areas economy not supporting it?
The problem with more buildings is more maintenance and money needed for them over time.
P.S. I have seen metal building rust out on the bottom. I have seen them develop a new rust color all over. What are they worth then? 5 years old is great. 25 years old is?
- SoCal_Engr
- Contributions:5667
I would think it would also depend on how the property is zoned. If it has everything needed for a small business concern - but is not zoned to allow this type of activity, well...
Strangely enough, couldn't this be viewed the same as almost any "added extra"?
Using Vince's example, a barn in horse country could be almost a "must". Accordingly, any "value" for the barn would be reflected in local comps. On the other extreme, if it's the structural equivalent of remodeling with high-end finishes in a low-to-mid level neighborhood - it may help with the sale but it's not going to add much in terms of value.
???
Strangely enough, couldn't this be viewed the same as almost any "added extra"?
Using Vince's example, a barn in horse country could be almost a "must". Accordingly, any "value" for the barn would be reflected in local comps. On the other extreme, if it's the structural equivalent of remodeling with high-end finishes in a low-to-mid level neighborhood - it may help with the sale but it's not going to add much in terms of value.
???
What about the value of that nice shop in the backyard?
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- 4.9/5.0
- (5 reviews)
Contributions:2899When there is a nice insulated metal building with concrete floors, and 220 electric how much does it really affect the value? Sometimes it is a cost of over $50 or $60k maybe even $100k to put these in, yet whether or not the appraisal reflects them in the value seems to be random.
Depending on the buyer, this shop has much value but there doesn't seem to be an acceptable standard for measuring the value. Thoughts? comments?
Have you seen some where the shop did have but shouldn't, or didn't but should, or just seemed to match what it "should" and how do you come to that opinion?
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