I am appraising a single family residence in sleepy New England town.
The subject is located on a dead end street, which runs into a marshy area where it ends, but also runs parallel to a major interstate highway, I-95, thus resulting in a very high noise level along with pollution levels.
All other homes on the street conform to subject, in terms of maintenance, appearance, age, and style. There are two comparables on the street that recently closed, less than 6-months ago (one of which is located across the street from subject) at a range of $340,000-$380,000, along with some active listings priced at $390,000.
Subject property happens to be in foreclosure; so this is an exterior only (aka, “drive by”) appraisal, in which inspection is done from street.
While inspecting the property from the outside, I am surprised to find a huge addition made to the back of the property, which makes the subject dwelling twice as large as other properties, but similar in all other parameters, such as location, appearance, age, and even bathroom count.
Given a 1-mile criteria, comparable property values range from $210,000 to as high as $X-million, given that some properties would be located on a much more desirable water front community. The majority of homes, above 2,500SQFT sell for over $700,000, in this particular town, but they are not located adjacent to the highway, as the subject property is, and they offer a much grander view as well.
What is the best way to approach this property? Can sales observed from the street be a good market value indicator, despite the subject being twice as large as other comparables in the area? Is this location, that is adjacent to a major Interstate Highway, on in which would drive the value in this case?
What would be your approach to appraising this property?
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