Newz: Surplus vs. Excess Land, Interest Rate Drop? GSE Oversight?
May 2, 2025
What’s in This Newsletter (In Order, Scroll Down)
- LIA ad: Am I Still on the ‘Do Not Use’ List?
- Surplus Land vs. Excess Land: What Appraisers Needs to Know
- 5 Mind-Boggling Optical Illusion Houses That Have To Be Seen To Be Believed
- Fed officials offer differing signals on timing of potential interest rate cuts
- Fed seen cutting policy rate by a full percentage point this year
- The Balancing Act: How Appraisers Can Navigate Supply Shortages, Interest Rates, and Tariffs
- A Cry from the Appraisal Trenches: The Fall of GSE Oversight
- Mortgage applications decreased 4.2 percent from one week earlier
Surplus vs. Excess Land for Appraisals
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Surplus Land vs. Excess Land: What Appraisers Needs to Know
By Kevin Hecht
Excerpts: Land valuation is a fundamental aspect of real estate appraisal, influencing property transactions, development decisions, and investment strategies. A key part of the process involves distinguishing between the land that supports the property’s current use and any additional land that may—or may not—have independent value.
Commonly, a square footage adjustment is made based on lot size differences among comparable properties without one key distinction – whether the difference in land is surplus or excess land. This fails to consider whether the extra land has value independent of the subject property.
Surplus land and excess land are often confused. Surplus land is land which adds no value independently of the property being appraised. Excess land, on the other hand, has value because it can be divided and sold separately. These distinct differences must be accounted for in an appraisal.
Here we will discuss what constitute excess and surplus land, common methods used to identify each, and why it matters….
Methods for Identifying Surplus vs. Excess Land
Residential appraisers commonly make a dollar per square foot adjustment for differences in lot size among comparable properties without distinguishing whether the land is surplus or excess. The problem with this approach is that it fails to consider highest and best use where excess land—land that can be independently sold or valued—creates a premium.
This question cannot be answered without evaluating zoning and legal restrictions of the property.
For example, just because a property is large enough to support a second structure, zoning may prohibit multiple residences on a single lot or there may be legal restrictions in terms of land coverage and minimum square footage requirements. If this were the case, it would be considered surplus land.
When determining if land is excess land, appraisers must consider legal permissibility, physical possibility, financial feasibility, and profitability.
To read more, Click Here
My comments: Read this blog post. Residential appraisers can easily make a mistake on this topic and get into trouble.
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5 Mind-Boggling Optical Illusion Houses That Have To Be Seen To Be Believed
Excerpts: Photo above info:
2. 8198 Uphill Rd, Joshua Tree, CA
Price: $17,950,000
The Invisible House: This mirrored mansion is the brainchild of film producer Chris Hanley and Frank Gehry collaborator Tomas Osinski, who designed the home to seemingly vanish into its desert surroundings.
At first glance, you might not notice the 5,470-square-foot residence staring back at you. Nestled on 67.5 acres, the shimmering structure was created with the intent of connecting its residents with the desert through the mirrored glass exterior. The three-bedroom estate’s interior is just as astonishing featuring retractable glass walls; a 100-foot, heated indoor swimming pool; and a 224-square-foot, white wall designed for movie screenings.
Whether you are looking for a home that quite literally disappears into the Arizona desert or one that mirrors its landscape in the Hamptons, these works of jaw-dropping art not only offer a captivating design but a remarkable setting.
From California to New York, we found five optical illusion abodes that will leave you wondering if they are playing tricks on your eyes.
To read more, Click Here
My comments: Click on the addresses for the listing. I have written about some of these before. I am fascinated by these types of homes. Now you can see 5 of them in one link. My favorite is the home in the photo above.
Read more!! →
Waterfront Home in Boca Raton, FL $25,000,000