Safe Room Adjustment in Appraisals

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!

Safe Rooms: The New Must-Have Amenity for the 1 Percent

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.

Dave Towne
Dave Towne

Dave Towne

AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003. Dave Towne on

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4 Responses

  1. Retired Appraiser Retired Appraiser says:

    The approach that you described is not only safer for the homeowner…it’s safer for you as the appraiser.  One can only imagine the feedback from the AMC or lender upon discovering a feature which deviates from black & white.

    “Please include three comparable sales that have taken place within the past 6 months within one block of the subject.  Please also include 3 comparable listings with safe rooms within the 1/2 mile of the subject.  Please include a comprehensive breakdown of the cost of building this room and illustrate the value differential should a future homeowner wish to remove this amenity.  As is typical of our requests, please forward this information to us within the next 8 hours.”

  2. Avatar TOM D says:

    “safe room adjustments” i was excited when i saw that phrase. i thought, ah no more worries about justifying an adjustment. maybe you could write a “safe uspap room” article. keep writing, always worth the reading.

  3. I disagree (surprise! I guess I just have a generally contrarian streak). I am OBLIGATED to accurately report special features and conditions just as I am obligated to keep the non public data of the owner confidential. I am a professional appraiser. I know how to appraise real estate including special security / safety features. Like everything else it starts with market recognition of the feature.

    In 1971 when I was an agent our office had a “white elephant listing” for $65,000 in a solid $30,000 neighborhood. It eventually was reduced to $57k and a couple years later it remained unsold when I listed it at another brokerage for $50K.

    It had a 3/4 bath addition and a semi subterranean laundry room addition to the original 1,200+- sf 3 br tract built 1950’s ranch home. [easy appraisal, right?] It also had a detached by fully enclosed 35 foot long pool with brick barbecue; a 15 x 20 family room behind the 2 car garage [more challenging, but still not exceptional].

    Sticking a key into the garage wall caused a 4′ x 8′ portion of the concrete garage floor to open vertically by an electric motor and counterweights, leading down an industrial steel staircase to a steel door. Behind that steel door was a bomb shelter of 10′ x 12′ with a 25 yard long rifle range extending under the driveway, capable of handling big bore weapons. It was sound proof and separately air conditioned with special filtration that I never did understand to keep radiation out. I showed the house to a deputy sheriffs wife and told her that if she didn’t bring hubby back to make an offer on it that day, I was going to make one myself. The owner heard me and to make a long story less so, I bought it for $40k (not 50) as a VA No down-No closing cost house and earned $1,500 salesman & listing agent side commission. VA appraiser had NO trouble appraising it for $40k.

    It cost the architect-owner $65k to build it out. Sale price $40k. Super adequacy was demonstrably $25k. Contributory value of ALL the amenities was only $10K. The appraiser KNEW from its over two year listing history it was not worth $65k or even $50k. Neighborhood comps told him it HAD to be more than $30-$35K. So his only issue was where in the range from $35k to $50K did it fall? He DID have the subjects sale itself as a guide. In the end I think all he did was add a nominal premium for covered pool and treated the extra bath, laundry room, detached family room and 375 sf rifle range plus 120sf bomb shelter at its end the same as potential “comparable” sales living area and then found a couple near 1,500 sf to 1,600+- sf sfrs to bracket, and he called it done.

    Appraisal isn’t rocket science. The appraiser merely replicated the actions of the marketplace and explained the results LOGICALLY .


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Safe Room Adjustment in Appraisals

by Dave Towne time to read: 1 min