Tuesday, December 2, 2014

Date of death, historical appraisal of real property for estate and tax purposes - Mary Cummins real estate appraiser, appraisal in Los Angeles, California

Mary Cummins, date of death, historical, appraisal, appraiser, Los Angeles, California
When some passes away and owns real estate a date of death, historical appraisal may be needed for tax or estate purposes. The appraiser's job is to ascertain the value of the property at the day of death. Cummins has been doing date of death, historical appraisals of real estate in Los Angeles, California for banks, lawyers and private individuals for over thirty years.

With an average residential property the appraiser gathers sales of similar homes without a certain distance within six months or so before the day of death. For example if the home was built in 1950, is 2,000 sf, 3 bed, 2 ba, on a 6,500 sf lot the appraiser would initially search for sold homes +/- 15% difference in square footage (1,700-2,300 sf), sold six months before date of death, within 1/2 mile radius of subject, in the same city and development. Ideally we should find at least six sold homes very similar to the subject property. We would then choose the most similar comparables based on condition, location, amenities, improvements...

Unfortunately this rarely happens except in newer tract homes so the appraiser must widen the search to find the most comparable sold properties. Location, size of improvement, bed/bath count are generally the most important factors. If the home has a view or is located on the beach, all comparables must have similar views, locations. The difference between view, no view can be up to 50% in some nicer areas near the ocean.

After we have chosen our six most similar sold comparables, we input them into our real estate appraisal form. We use ala mode software. We input the most similar of the six comparables into the number one column then add the rest in descending order based on degree of similarity. After this we adjust for each of the line item differences if necessary such as the differences in square footage, bed/bath count, lot size, condition, age.... Ideally we should have chosen the most similar comparables so we should have few adjustments.

Besides the sales approach we often include the cost approach. This generally sets the upper limit of value. This is not the best indication of value as there are generally few vacant land sales available in the immediate area. The appraiser generally has to obtain a land value by abstraction or allocation. Sometimes an income approach is added if perhaps the property is a vacation rental.

After we have done all of our research and have our sales, cost and income approach valuations we reconcile the three values to come up with the appraised value. With a single family home or two to four plex in most areas the sales market approach carries the most weight with the cost approach setting the upper level of value.

The final part of a date of death, historical appraisal is to add the limiting conditions. With this type of report the appraiser states that the property was inspected as of a certain date. The report was signed as of a certain date. But, the date of the "value" of the property is the date of death. The appraiser assumes the property was in the same condition on the date of death as inspected. If not, the appraiser makes note of the condition at date of death and includes this in the valuation.

Contact Mary Cummins of Cummins Real Estate Appraisals if you have a question or need a date of death, historical appraisal (310) 877-4770 or Mary@MaryCummins.com Average single family residential appraisal is $300.

Mary Cummins of Animal Advocates is a wildlife rehabilitator licensed by the California Department of Fish and Game. Mary Cummins is also a licensed real estate appraiser in Los Angeles, California.

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