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Real Property Appraisals/Detention Pond Easement - Property Value


How should having a detention pond easement on your property affect your property value? If you had 2 identical properties with the only difference being one had a detention pond in the back half of the backyard, what might the price difference be (stated as a percentage)? Is this kind of easement something that should have been picked up in an appraisal? Should the appraiser have made an adjustment for the easement when comparing to other homes without a detention pond?  




I apologize, I was working 24/7 last week trying to get a report out and am just now able to respond to your request.

Quick answer to your first question:  It depends.

With regard to your 2nd question, the property with the detention pond "should" be worth less because the back half of the property would be unusable. To measure this difference requires locating and analyzing comparables in your area to determine: first if a stigma exists, and next measuring a dollar or percentage diminution in value for this stigma.

There is no set percentage to throw at it. Real estate is location specific and the diminution in value where you are located would not be same, dollar-wise or percentage-wise, as the diminution in value in my area, or any other area for that matter.

I doubt that this detention pond is hidden, the detention ponds in my area are easily spotted. If you're indicating that the appraiser did not pick up the pond, the only reason I know of for missing something like this is that the appraiser could have thought it was not on your site. Is there a chance the appraiser could not have seen the pond because it is shielded by a hedge row, or row of trees? This is why I ALWAYS look at properties behind, or to each side of any property I am appraising.

In any case, the appraiser should have reviewed a Title Report. Assuming the Title Report describes the detention pond, the appraiser should have picked it up on this report. Have you read the Title Report for your property to make sure the pond easement is called out by a Legal Description?? Have you obtained an Assessor Plat Map for your property to see if the detention pond is shown on the Plat Map?? If it is an easement, it should show on the Plat Map.

If I had seen this pond, I would have first asked you about it. This is when you would have told me that it was a detention pond easement on the back half of your property. This is where the appraisal assignment would have radically changed with respect to Scope of Work. It would then be necessary to find comparables of properties with similar stigmas, measuring first if a stigma exists, and then measuring what that stigma is in dollars, or as a percentage.

If this was an appraisal for a loan you're obtaining, the problem is that residential appraisers are not given enough time, and are not paid enough to attack this kind of issue. See other question answers I have provided in this Website - see "Bad Appraisals", "incompetent appraisals" etc.

In addition, most residential appraisers wouldn't have a clue how to measure this problem. To answer your final question, if the appraiser had properly analyzed this issue, and had found that there was indeed a stigma for having a detention pond on site, then - yes, the appraiser should have applied an adjustment when comparing to other homes without ponds.

I could go on for about 300 pages describing the methodology in attacking this issue. If you want me to give you some information about what should have been done by this appraiser, I can give you a few minutes if you call me at 951-255-6466. Good luck in getting this issue resolved.

John C. Carlson
CA Certified General Real Estate Appraiser
Victorville and Diamond Bar, CA  

Real Property Appraisals

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John C. Carlson


Any questions regarding commercial and/or residential appraising, appraisals or real estate valuation such as: appraising as a profession, valuation techniques, comparable sales selection & analysis, the new HVCC and how it affects appraisers & Borrowers. Also, questions like: "Why did my appraisal come in low & what can I do about it?" I cannot answer questions about comparable data in areas in which I do not practice. I have expertise in most areas of So. California.


31-years both commercial and residential valuation experience. State of CA Certified General Real Estate Appraiser, licensed to appraise all property types. FHA Approved. Specialized expertise with historic, architectural & luxury residential property valuation. Experienced in industrial building and small commercial property valuation. Experienced Reviewer of appraisal reports and expertise with intensive forensic reviews to uncover fraudulent appraisal reports. Expert Litigation and Expert Witness experience.

Associate Member of the Appraisal Institute. Associate Member of the Certified Fraud Examiners.

Numerous posts to Blogs. Please "Google" "John C. Carlson Real Estate Appraisals" where a list of responses I have made will show up.

Numerous classes by the Appraisal Institute since 1978 in the practice areas in which I specialize

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First Republic Bank Wells Fargo Bank California Bank & Trust Preferred Bank Numerous Attorneys.

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