fha apprasial question
Trying to help a couple family members, buy and sell a property. Bit of an unusual one, two homes on one two acre parcel that cant be split. Brother is selling to Nephew who is buying with fha loan, to live in one and rent out the other.
Sale price 140,000, apprasial just came in at 125,000 which surprised everyone.
Four years ago at the bottom of the market here, when my brother refinanced it, for 100,000 the apprasial came in at 135,000 real estate values have been steadily increasing for the last three years at least, significantly the past two.
Looking at the apprasials they appear to have used a significiantly different methodology of arriving at appraised value.
Since similar properties are exceptionally rare some adjustments have to be made from other sales. The original appraiser used actual recent residential sales from the same town, same school district, used sq ft, bath, bedroom, acerage adjustments to come up with his appraised value.
The most recent apprasial used duplex sales three to five miles away, different towns, different schools. He then did a second method using income approach with gross rent multiplier, both of these methods came in about 125,000. Odd thing is, only one of the houses being sold is rented, the smaller one, for 750, he used 650 as "estimated" rental income for the larger house. This house would easily rent for 900, maybe 1000 . If you use his income approach a method and use 900 instead of 650, the value increases to just over 140,000.
Any fha appraisers with insight on what typical methods are typically/required to appraise such a property, for an fha owner occupants.
Can apprasials be challenged, i understand fha apprasials stick with property for six month, say we pay the bank to bring two or three more appraisers out and they all come in higher?
Ps, just ran all the sales in our town for the psst six month, including distressed homes, excluding a few mobil homes. I ran it for the town, and seperately for the school district, taking average price per sq ft x amount of sq ft of theses properties both come in, in excess of 140,000.
Anyone have any insights on "required" fha apprasial methods for such a property?
Anyone challenge an apprasisl and won?
Theres no way my brother will sell this property with rent income "ability" , hes currently living in one, of 750+950 rent income. Houses are fully renovated, all new mechenicals, kitchen, baths, windows, roofs etc, great rental location for 125,000.
Any bright ideas be appreciated.