Real estate question

[Dirtyhip]

If you were building a home and plan t not take any loans for the process, would you get it appraised at the end of the process?

I am thinking for insurance reasons, like if it were to burn down, etc.

What value is there to an appraisal at the end, or would you just build...insure it well and not worry about it?

[Further]

You need some basis for the insurance value 

[bikeman564™]

I'd say you need it appraised for insurance, because you'll need replacement value. regardless what  you spend building it. Also for property taxes. I don't know who initiates the appraisal.

[shootingstar]

Wouldn't you be required to at least pay property tax to the municipality?  It may not give you an accurate true assessed value, but just a starting point.

At least find out next yr. from municipality..at least that's what I would do ...but maybe in CAnada it's different.  That's how all municipalities function....their services is partially funded by local resident/commerical tax annually and some funds from their provincial government.

[Dirtyhip]

6 minutes ago, shootingstar said:

Wouldn't you be required to at least pay property tax to the municipality?  It may not give you an accurate true assessed value, but just a starting point.

At least find out next yr. from municipality..at least that's what I would do ...but maybe in CAnada it's different.  That's how all municipalities function....their services is partially funded by local resident/commerical tax annually and some funds from their provincial government.

Of course I have to pay taxes.  The city will likely appraise it the way they do for assessment.

13 minutes ago, bikeman564™ said:

I'd say you need it appraised for insurance, because you'll need replacement value. regardless what  you spend building it. Also for property taxes. I don't know who initiates the appraisal.

I think most people need an appraisal to fund.  My build is not normal, cause I am funding it. 

I am thinking that same thing, for insurance reasons.  

[Kzoo]

The local government will put a value on it for tax purposes and the insurance company will put a value on it for replacement purposes.  If you are not going with replacement policy you can insure it for whatever value you want.  
 

we don’t have replacement on the building due to some really strange valuation questions.  I just insured it for a value I know I can get it replaced for.

[Parsnip Totin Jack ★]

You hire an appraiser for your insurance purposes. The county tax assessor does their own appraisal for tax purposes. 99.9% of the time the county appraisal is lower than your personal appraisal. If it’s not, you can then use your personal appraisal to dispute the county’s number to lower your tax bill. @Scraprcan help you find an appraiser in your area. 

[Airehead]

Yes absolutely get it apprIsed with an appraiser of your selection. Also, you absolutely have insurance during the build. Kids have. Beer bash and burn the partially finished interior, you definitely want to be covered. 

[Dirtyhip]

24 minutes ago, Airehead said:

Yes absolutely get it apprIsed with an appraiser of your selection. Also, you absolutely have insurance during the build. Kids have. Beer bash and burn the partially finished interior, you definitely want to be covered. 

Ah, good point.  OMG!

[Green Grass]

20 hours ago, Dirtyhip said:

Ah, good point.  OMG!

If you don't have Course of Construction insurance, get it Monday.

As far as on-going insurance, talk with the carrier.  They will tell you what they require to justify replacement cost.   It seems to me, that the most accurate cost to replace would be the current construction contract.  That will obviously change (increase) over time, but right now that's the most accurate number.  An appraisal will include the value of the land, which isn't going to need to be replaced.

Anyway, that's my advice.  I'm  in the process of building right now, as well, and what I stated above is what I'm doing.  Self funding the build, just as you are.

[Airehead]

Just now, Goat Geddah said:

If you don't have Course of Construction insurance, get it Monday.

I could not remember the name for it but I agree. Do not do anything, not even pound a stake without it. 

[Dirtyhip]

1 minute ago, Goat Geddah said:

If you don't have Course of Construction insurance, get it Monday.

As far as on-going insurance, talk with the carrier.  They will tell you what they require to justify replacement cost.   It seems to me, that the most accurate cost to replace would be the current construction contract.  That will obviously change (increase) over time, but right now that's the most accurate number.  An appraisal will include the value of the land, which isn't going to need to be replaced.

Anyway, that's my advice.  I'm  in the process of building right now, as well, and what I stated above is what I'm doing.  Self funding the build, just as you are.

Thank you.

Nothing to insure yet.  We are not doing anything that needs to be insured right now.  It's a pile of dirt.

[Kzoo]

33 minutes ago, Dirtyhip said:

Thank you.

Nothing to insure yet.  We are not doing anything that needs to be insured right now.  It's a pile of dirt.

Wrong.  You own land, you have liability tied to it.  Is general liability tied to your existing home going to cover you on the new property?

[Longjohn ★]

1 hour ago, Dirtyhip said:

Thank you.

Nothing to insure yet.  We are not doing anything that needs to be insured right now.  It's a pile of dirt.

Insurance on a dirt pile should be dirt cheap.

[Dirtyhip]

4 minutes ago, Longjohn said:

Insurance on a dirt pile should be dirt cheap.

You are punny.

35 minutes ago, Kzoo said:

Wrong.  You own land, you have liability tied to it.  Is general liability tied to your existing home going to cover you on the new property?

You worry too much.  Who insures raw resi land?  Like, hardly anyone.

We will insure when things start happening.  

[Green Grass]

50 minutes ago, Dirtyhip said:

You are punny.

You worry too much.  Who insures raw resi land?  Like, hardly anyone.

We will insure when things start happening.  

DH, I think you missed Kzoo's point.  He's speaking of liability...like if someone walks across your lot, steps into a little hole and breaks an ankle...then sues you for their medical costs and lost wages, pain and suffering, etc.  

Obviously you don't need property insurance on dirt, but you do need liability coverage.

[Bikeguy]

23 hours ago, Airehead said:

Also, you absolutely have insurance during the build.

We started our insurance for our new home the day they started digging the foundation.  If I recall, the bill was cheap for a while.   Our builder had his insurance too.  We paid him in 6 or 7 installments as construction progressed.  I didn't want any issues with anything.   Like who owns what if there was a storm (tornado) of fire, etc...   I only wanted to pay for the home once.  That's enough.... 

We were meeting with the builder at home during the constriction.  Then there as this HUGE crashing noise in the woods just behind the home.   OGM large tree just fell over.   The tree trunk must have been 3 feet in diameter.  There was no wind. For some reason, the tree just snapped a few feet above the ground and fell over.   At least it was nowhere near the home.

Our county did it's own assessment of the value of the home.  I already did battle with them and had the assessment reduced.

Our insurance did their assessment of the home for replacement value too.  I think I ended up giving them a copy of the prints for their assessment.

Our bank did their assessment of the home for the loan.  They also had some kind of finance company (can't think of the name now) that managed the distribution payments to the builder.  They did their own assessments and inspections of the home during construction too.   

 

[Ralphie ★]

I salute anyone with the patience to have a home built. That stuff drives me crazy. 

[Airehead]

7 hours ago, Dirtyhip said:

You are punny.

You worry too much.  Who insures raw resi land?  Like, hardly anyone.

We will insure when things start happening.  

Liability starts with ownership. Keg party in your lot and someone trips and cracks their head. Uninvited guests often sue. It is cheap. Get it and sleep well is my two cents. 

[Dirtyhip]

4 minutes ago, Airehead said:

Liability starts with ownership. Keg party in your lot and someone trips and cracks their head. Uninvited guests often sue. It is cheap. Get it and sleep well is my two cents. 

I hate people, except for you guys and my friends/family.

Strangers are bastards.  The lawsuit crap is annoying.

I will call my agent.

[Bikeguy]

3 hours ago, Philander Seabury said:

I salute anyone with the patience to have a home built. That stuff drives me crazy. 

WoBG and I agreed if our marriage can survive building a home, we can survive just about anything.  I NEVER want to build another home. 

[Airehead]

58 minutes ago, Bikeguy said:

WoBG and I agreed if our marriage can survive building a home, we can survive just about anything.  I NEVER want to build another home. 

Our experience was pleasant. We got exactly what we wanted from a fabulous builder. Maybe he was 1% or 2% higher but maybe not-  so hard to tell.  We learned that all their sub contractors had worked with them at least 20 years.  That said something About them. They included us in everything and gave good advice.   Only once or twice did I think I would lose my mind. The cabinets In the kitchen come to mind and the kitchen store sucked if you ask me.  We did lots of upgrades and the builder was prompt about letting us know when I picked stuff like light fixtures that were above what was included in the original,price. He called me and asked me if I really wanted a 15k upgrade for the master vanity. We talked about it and I stayed with what I picked out originally.  Last house I wanted a few items.  

[Dirtyhip]

1 hour ago, Bikeguy said:

WoBG and I agreed if our marriage can survive building a home, we can survive just about anything.  I NEVER want to build another home. 

We gutted this house while we lived in it.  There were tough moments.

It was hard.  We will have a builder, and agree on mostly everything.  Although, this trailer thing will be interesting.  A good sample of van life, right?  HAHA