You have to read this week's Woodstock Independent and the article about the Woodstock Christian Life Service's plan for Grace Hall (more recently known as Harrison House).
And wait until you see the appraised value! Ready? Sitting down?
According to the WCLS appraiser, Krueger Appraisal Services, Inc. (all the way from North Aurora, Ill.), the land on which Grace Hall sits is worth $325,000. And the building? Appraised value of zero. Get it? The appraised value of the building is $0.00. Who are they kidding?
OK, quiet down. Don't you know that too much belly laughter is hard on the body? You might bust a gut. Permanently freeze your face into a position of glee and happiness from which there might be no recovery.
Where does the line form to buy the land and the building for $325,000??? Would WCLS sell it for that? Sure, they would. Give me a break!
Well, they offered the building for $1.00 and got no takers. Is that how they determined that it's worth Nothing? What a joke! Let's hope the City Council doesn't fall for that trick! The audience in the peanut gallery at the City Council meeting where the $1.00 offer was made was polite and didn't burst out laughing. Next time? The laughter should be loud and long.
Come on, folks. Stop being polite. When shenanigans like this are put over on you, stand up and object! Now, don't all stand up at once. When the esteemed Mayor has the source of the loud laughter ejected from the Council chambers, there need to be a few left to laugh the next time. And the next. And the next.
The City is full of houses that have no takers for the seller's asking price. Does this mean that the house is not worth the asking price? Yet reductions in assessed valuation of residential property might be harder to get than the winning Lotto ticket numbers for Saturday night.
Ahh, but wait. President Terry Egan says the land is worth more than $325,000. Well, duh.... Of course, it's worth more.
Where is the place to be this coming Tuesday night at 7:00PM? The Woodstock City Hall, second floor. There can't be anything on TV that will be able to compete with this meeting. How about 100-200 people there to insist that the City Council stop WCLS in its tracks and tell it to come up with a solid, straight-forward project and cut out the (I'll be polite here) with the $1.00 sales price nonsense.
The City could blow $500 and get its own professional appraisal. Should it? A second appraisal of a worthless building shouldn't cost very much.
You never know who is interested…
3 months ago
4 comments:
I was a licensed appraiser (expired seven years ago). All be it, I was not very experienced overall and I had NO commercial experience; But I would have to assume that ALL improvements have to be taken into account. The only way I can see a $0.00 value for a structure on a piece of real estate is if the structure suffers extreme differed maintenance. I would have to assume that level of differed maintenance would have to be justification to condemn the building. If the owners are utilizing the building now, it is obviously useable, therefore having value. The only other way I can see a $0.00 value is if it was appraised more as a "highest and best use" appraisal of the property. Meaning, that the property value (including all improvements) was looked at more from the perspective of how the owner WANTS to use the property.
As far as the $1.00 price tag the owner offered, it is not viable. First it is not an amount established by marketplace forces. It also requires the purchaser relocate the building. An experienced and currently licensed appraiser can offer the actual professional terminology. I've forgotten.
But I'm betting the appraisal was in regards to the property's Highest and Best Use. Not its' actual estimated market value.
FYI - I got out of appraising due to a higher paying job offer.
I'm sure that this is a very complicated argument, either in favor of WCLS or that of the City or interested groups.
I'm assuming from your comments, Gus, that you feel that the appraised price of $325,000 is too low. I am also assuming that should the City or some other group wish to purchase Grace in order to preserve it, that you feel that WCLS would be asking much more???
Having also been an appraiser, I would first say that when viewing an appraisal, one needs to know what the "scope of the appraisal" is. This is usually stated in the opening paragraphs of the appraisal. Depending on the client (which may not necessarily the owner), what their intended use may be, as well as what value they are trying to determine relative to their plans for the property, all affect the appraised price. You can see that WCLS, the City or a civic group, a commercial buyer, or someone buying it for a residential use, all would have different ideas of what the property is worth.
You said:
>>>> According to the WCLS appraiser, Krueger Appraisal Services, Inc. (all the way from North Aurora, Ill.), the land on which Grace Hall sits is worth $325,000. And the building? Appraised value of zero. Get it? The appraised value of the building is $0.00. Who are they kidding?
Most of us who toiled in the trenches dealt mainly in single family homes of all types, possibly vacant land, as well as an occasional easily comparable commercial property. That the Appraiser in this case is far removed geographically is not necessarily germaine. This appraisal requires some special expertise, and that narrows the field considerably. In the end, most such values rest on available sales and listing data, all of which can be gleaned from any distance.
You'd have to know WHAT the "highest and best use" of the property is, and so informs the scope of the appraisal. Generically speaking, this would be the most intensive development of the property and/or the use that results in the highest overall value of the property development as proposed. But, as discussed, if another conceptual use or buyer of the property is coutenanced, the value could change.
In this case, it would appear that only the land itself was valued. That's not necessarily invalid, as ignoring the building value itself would appear to be what the instructions to the appraiser were. WCLS sees no value in the building, as they've determined that the building is not economically useful to their intended purpose. What with code and life safety requirements, it would cost far more to rennovate than its eventual sales price for the offered living units would be worth, not at all uncommon for a building of its age, not to mention the purpose for which it was constructed and has functioned, and that of which is desireable or required today.
The one dollar sales price for a building which must be moved by the buyer is pretty standard. It must meet either with some tax consideration (gift tax), or an issue of liability.
Zoning also plays into it as well. Presumeably, the current zoning is "special", either in some tax-exempt fashion, or probably allows some existing use through a Special Use permit. Zoning is one of the highest determinants of value. While the City may be indulgent to a civic group who wishes to preserve the building as a foundation HQ or a museum, one cannot assume that the City would willingly bestow commerical zoning on the property, nor as any other sort of residential use. As future zoning is determined in part by politics, any sort of assurance made by a buyer, seller, City employee or current municipal office-holder is crap. In fact, you'd have better odds at knowing what the future held in terms of your bet at a Craps Table than you would for any concrete assurance as to what the allowable use of any such property will be in the future!
One cannot also be so sure that as any other residential use, that potential residents or buyers would readily accept such offered rennovated units, depending on what it is that is surrounding it, as well as other established neighborhood uses - if such uses are viewed as incompatible with their own proposed use, values can suffer greatly.
Right now, this parcel's best intended use to WCLS is as a vacant parcel, ready to be developed into their concept.
>>>> The City is full of houses that have no takers for the seller's asking price. Does this mean that the house is not worth the asking price?
An appraisal is a snapshot in time. In this case, at this time, and in this market, YES, these homes you speak of ARE NOT worth the price that are being asked, particularly if they have not sold within what is the current average marketing time for similar properties. A property is only worth what it is that buyers are willing to pay for it in an open market. Only THE MARKET is valid - mortgages, assessments, etc. are only distractions, and do not have any bearing on value at the moment.
Could properties be worth more or less in the future, the past, under different zoning, or with different proposed uses? Sure. But you are likely unable to get any honest appraiser to speculate on ANY future possibilities, unless by necessity they take those impossibly unpredictable factors into account, and only are valid as stated in the preamble in the "scope of appraisal", and any associated stated conditional language. Any time you start digressing from an "as zoned" or "value today" type of valuation, the appraisers "guesses" start becoming only slightly better than those of a layman. If you do not know what the scope is, any arrived-at bottom line value is irrelevant to any other interest or argument over the subject property.
FIND OUT WHAT THE SCOPE OF THE APPRAISAL AND THE RELATED CONDITIONS ARE. Read the entire report verbiage, otherwise any final stated value is worthless as a point of discussion or negotiation.
DBTR
Well said 'River.
DBTR, you get my vote for taking over this blog when the present mediator drowns after looking up to see where the rain is coming from.
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