Safe Room Adjustment in Appraisals
Use of a Safe Room has Increased by Property Owners
If you’re doing a standard 1004 SFR, or 1073 condo (or perhaps a Co-op), report and encounter a “Safe Room“, you might need to add that to one of the extra adjustable component lines on the grid.
The trick however, is how do you determine the value of such a safe room and apply a proper adjustment? I suspect they vary in size, interior amenities, vault door construction, and bazooka stopping power of their perimeter wall structure. I dunno! If encountered, I think I’d call Jonathan Miller, who is mentioned in the article below, for advice!
By the way, those appraisers out in fly-over country may not need to worry about this! But if you’re located in places where the mega-rich hang out, these extra amenity rooms might be encountered once in a while.
If you reveal its existence in your report…
An appraiser I know, who’s been in this business for about 20 years, wrote:
“I’ve appraised a number of high end homes with safe rooms. I always note it, but I NEVER disclose its existence. One of the biggest keys to having a safe room is that the bad guys don’t know about it. That buys the homeowner time in the event of an emergency situation. have always re-assured the homeowner that I won’t publish it or its location and I’ve always been thanked by them for that. Just because I don’t put it on the form doesn’t mean it’s not in the value.”
That approach is probably ‘safer’ for all parties.
And it brings up another valid point: just because a property has items that may have intrinsic value does not mean those items have to show up on the grid. These are what I call “non-adjusted qualitative items.” That’s why the reconciliation process can work in your favor. You can account for these items in the reconciled value without having to make a specific dollar adjustment for them…assuming of course, that your range of comparable sales adjusted values has enough wiggle room at the top end.