We passed another milestone yesterday, which was to get the appraisal on the homes back based on our plans. Since we are the first to build a new home in this up and coming neighborhood and there are few comparable new construction sales nearby, we were a bit nervous. We got the call late yesterday afternoon that both homes had appraised for $255K. This is great news as it will allow us to get the full loan amount that we need for our construction budget. This also supports our target sales price of $200K – $250K for the homes.
I spoke to our appraiser a few times on the phone from Croft Appraisal Services. He was very friendly and really appreciated both the modern and “green” aspects of the home. I think this helped a lot as there are some appraisers out there that would not see these aspects of our design as positives. Some may even penalize us for not being traditional enough…
Secondly, our settlement date on the land is today. The date has been delayed by two weeks for now due to an issue with the Title Search on the property. The current owner received the land for $1 from a relative that lives outside the country and has since passed away. The low price on the deed raises a red flag for our title company and they need to verify that the previous owner has actually passed away. They need a death certificate or similar proof of his death. So far the current owner has not been able to produce this and has hired an attorney to track down proof of death for the deal to move forward.
We are not too concerned about this at it will most likely delay settlement on the land but should not effect the construction timeline. The title company needs to verify the death of the previous owner to ensure that they will not come around after we have made improvements to the land and claim that they legally own the entire thing. Just another one of the joys of development.
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