Potential value add? 800 sq ft shop remodel?

Question

Property is an 3 bed 1 bath 1230 sq ft SFR in a fairly hot market (Seattle) on a third of an acre.

In the back yard of the property lies an 800 sq ft double wide.  The previous owners were using it as a shop.

The square footage of the shop wasn't included in the listing.  Is this because the structure wasn't permitted?  Or possibly because it wasn't finished?

If we were to to a bare bones remodel on the double wide (laminate flooring, drywall & paint, lighting) would the extra square footage be included in comparisons and appraised value?

It would essentially be a giant recreation room/family room.

My gut tells me that if minimal money could turn an essentially unusable space and add an extra 800 sq ft of usable space that it would never be a bad idea but will it count in an appraiser's eyes?

Trying to add value and force equity in a quirky set-up.

Brian Erickson · Answer

We're on sewer and the double-wide sits higher than the street.  You can actually drive up to the double wide via a long driveway up the side.  The main house has a round-a-bout in the front for access, though it's easier to access the house at the double-wide from the long driveway.

Just checked parcel viewer and it's not even listed.  Though it is listed as an outbuilding on our insurance.

I figured as much that I would just need an appraiser's opinion as it's a rather odd set-up.  The biggest wonder of the whole equation is figuring out if the juice is worth the squeeze.  Seems like it would take a fair amount of work to get it set up as an actual livable, rental unit.  Also makes it hard when contractor after contractor won't return calls when they say they will haha.

Jeremy Benezra · Answer

Sewage waste is your more difficult item to run.  Supply water is pressurized and can go uphill, to an extent.

Sewage waste flows by gravity and needs elevation drop in the waste line to flow.  So the waste leaving your shop needs to be higher in elevation than the sewer connection at the street or the connection at the main house.  Otherwise you'd need a sewage pump.

If you're shop didn't have a bathroom, just gray water, you could do a gravel pit.

Victor S. · Answer

I, too, have a shop that's currently supplied by a well, but was wondering what the typical price of running a city water line is? (per foot, etc.) Thanks!

Jim Adrian · Answer

I dont have a clear answer for ya but here is some info. Because the double wide trailer is technically movable, an appraiser may over this look this.  The sq footage will not show up on your county assessor / property tax site either, which appraisers use. If it shows up on your assessor site then you would be taxed on the extra 800 sq ft.  Are you zoned or allowed to have a "Accessory Dwelling Unit" (adu)?  Now this could cause you some problems, if you are not.

Jeremy Benezra · Answer

I don’t know if you’re on sewer or septic nor where those waste lines run in relation to the main home and the doublewide.  Getting electrical and water to the ADU is fairly straightforward, getting the waste out and to the sewer or septic system is harder as you need elevation fall in the waste line.

If you could get the doublewide up to a livable status as a rental, while you lived next door, you definitely would be successful in forcing equity.

I don’t think egress comes into play here.  Normally you just need to provide a large enough opening for people to get out during an emergency and for geared up firefighters to get in.

Why is accessibility an issue?  You can’t drive right up to the doublewide?

On King County parcel viewer they will sometimes list more than one structure on the property detail page.  You could see the square footage and specs for the main home, then click structure 2 and see that info for the doublewide.  That’s of course pending that King County even knows that doublewide is there.

I don’t see an appraiser giving a lot of value to a double wide with no plumbing in their value calculations.  But it might be worthwhile to get in contact with an appraiser and ask how they would value it.

Brian Erickson · Answer

You're good!  It's just outside of Seattle down near the airport.

I posted here because it's the one subcategory that sort of made sense.  It's actually our current primary residence.

We're trying to force equity into the place the best that we can on a budget so we can leverage it to invest in more buy and hold properties.  The two main goals right now are to tenant-proof the main house the best we can (removing old carpet, replacing with laminate, removing the cracking kitchen tiles with the same laminate) and to try and take advantage of the weird situation that is 'the shop' out back.

It doesn't seem cost effective to try and plumb an extra bathroom or turn it into a self-sustainable MIL unit but maybe I'm wrong?  Even if you did, I wonder about egress and accessibility, since it's in the backyard

It's a water tight 800 sq ft.  We have three kids so building it out as a bare bones recreation room seems to make the most sense for us both currently living here and utilizing it as well as adding an additional 800 sq ft for the purpose of increasing value of the property.

My main question is, because it is not connected to the main house will the square footage count of the double wide count towards the overall total square footage of the property?  In the eyes of an appraiser would the finished 800 sq ft significantly increase the value of the property? Or does it not count because it's a separate room and/or non permitted structure (potentially)?

Jeremy Benezra · Answer

If this was a rental property I'd say do it for sure.  Set up the additional unit, almost the entire rent payment will be an increase in cash flow.  You'd be adding a door, lowering the risk of that property being vacant, etc.

For a flip its harder to say.  Depends on the market.  Depends on if the buyer has a need for a MIL or if the buyer would want to have an ADU on site rented to someone else to help with their payment.

1/3 of an acre?  Is it in a Seattle suburb?  A lot of people on larger parcels have a need for a shop space and would maybe want that instead of another dwelling unit.