Appraisal for house with mother in law suite

[Jacob Albright]

Hi I’m still new and learning as much as possible. We bought a fix and flip for 78000. It has two house on the property one is a mother in law suite. We fixed this one up and put 23000 into it, it was pretty bad. Wanted to get some of that cash back to fix the main house up next so I refinanced for cash. The appraisal just came back and was saying the house is only worth 84000. It’s seems like they compared only houses that looked like the main house and didn’t go off of anything for the mother in law suite. I’m just wondering if anyone has ever ran into this and why fixing up the mother in law suite wouldn’t add any value. Thanks for the help everyone!

[Bronson Massas]

@Jacob Albright The mother in law suite certainly does add value but the challenge is that it is very hard to quantify that value as there likely aren't many recently sold homes nearby of a similar size, bed/bath count, and condition that also have a mother in law suite. For this reason, many lenders/appraisers will not count unique/hard to value items such as mother in law suites, pools (in some areas), golf memberships, etc.