When completing a BPO, do you include un-permitted GLA and choose comps that have the addtional sf, or choose comps that are closest to the legal GLA? The guideline from the client doesn't provide any answers.

Thanks in Advance.

I tend to use the numbers from my source. If I'm getting my info from the assessor, then I use their numbers and if it's straight from the MLS, I use those numbers, even if their not permitted. The way I see it, I can explain where I've pulled my numbers from. I'd also like to hear from others on this subject.

I just had this situation. I used comps that included both SF samples (most prices around here come down to a "per square foot" cost anyway). In my comments, I explained that the "addition" didn't meet codes and would require extensive work to be considered livable space. So far, it hasn't been kicked back.

This was a 2nd opinion BPO and I'm sure they aren't going to be happy with my price. IMO, the agent that has it listed, has listed it for about $30,000 more than it's worth (it would need that much in repairs to even be comperable to neighboring properties).

We'll see if I truly get the listing (like I was told on the phone) or not. Maybe they should have waited for my opinion before making that offer. ha ha

So if MLS state 1000sf with 200 sf addition (non permitted) you'd go with 1200? I look at it like the market would react positively to 200 added sf, permitted or not, so I should included it.

Hmmm... I know one company that will upgrade to an interior if there are those kinds of questions. I think I'd stick to my source if it was a drive-by. I always comment any discrepancies. Had one recently where they told me to use the numbers they had for a previous appraisal. Only problem was the appraisal included the garage in the GLA. I put it in the comments and used the assesors number.

I've passed this question by the California Assoc of Realtors Legal Hotline ofr a listing I had. They told me not to advertise any unpermitted square footage. I know that isn't exactly the same as doing a BPO but I think there's a guidline there: considering illegal area could lead to an E&O claim.

My county has very tight land use policies, so unpermitted aditions are the norm. Yoou should see the comments in the MLS to skirt the issue. Whenever you see "assesor's records show 1000 sqft" you know it's more and there's a posssible baragain... gotta go see that one.

Agreed GGWWTTRE, I would stick to my sources. I get an upgrade to interior if the owner says SFR and I say no it's a coop or condo. Illegal addons are just that.