Multifamily Appraisals: Single vs Multiple Structures

[Michael Archard]

Hi BP,

I've been looking around for a 4 family property to FHA owner-occupy in the greater Boston, MA area. I have seen mostly 4-unit properties but occasionally come across a single property with multiple structures (i.e., 3 family and single or two 2 families on one lot).

My question is specific to the appraisal process, does anyone have any insight on the appraisal process? I know every appraiser is different but I am wondering the general approach. Are the comps of two structures, say a 3 family and single family on a single lot, based on 4 family structures in the area or are they based on the combined values of individual 3 families and single families?

Thanks,

Mike

[Colleen F.]

Four units and below they will appraise the buildings but they may subtract for them being on one lot (in my experience). They will basically adjust for the differences from any property they use as a comp. It just depends on what is available for comps at the time. I am not sure if for FHA there are any specific differences.