Housing and Community Development

-------------------------------------------
Perry Cofield AIA
Design Ways & Means Architects
Arlington VA
-------------------------------------------

Although I usually agree with much of what Eric Rawlings says, I don't know that separating lot cost from house value in appraisals would help much.  In my county property assessments add the potential value of the land (as if it were a vacant lot) to a value of the house (as if it were an old pair of shoes) to come up with an annual assessment.  This is a defacto restatement of the old saw about Location to the third degree. In boom times, this assessment policy facilitates tear downs, where larger houses, built to their maximum allowed envelope, will fatten the county troffer. Even in these fairly slow times the tear-downs continue.  By what motivation would appraisers change? A better approach to getting the buildings their due would be to have an energy assessment of the house made mandatory as in the UK.  A "grade" is given to every house that goes on the market.  If the AIA could get this going in even one state, or by federal mandate, Realtors would begin to see the current culture change, or at least evolve slightly.  As it is, you really can't "prove" that design has any value, other than in the eye of the beholder.  Sad to say.

One of the main reasons for separating Lot from Structure is to avoid having to compare unlike houses just because they are in a one mile radius. Location is that Real Estate mystery that is always the excuse for not recognizing uniqueness in the Structure. By not recognizing uniqueness in the Structure, then design tends to be a liability, not an advantage. This is not good for those of us that design for a living. Appraisers only see Locations as unique, not Structures. The same cookie cutter house built in two different neighborhoods should cost exactly the same price minus the price of land, yet appraisals never yield those results. People always say, "That's a $400K house and that one in the nicer neighborhood is $600K." NO! The house is worth $250K in both places. The Lot in one Location is $150K and the other is $350K. Once we separate the mystery of Location, which you noted is already being done by the Tax Man, we can compare the structures any where in the country. We could finally see exactly what it is that the free market is willing to pay for, Location or House. Because Lot & Structure prices are meshed together design doesn't matter. We need design to matter! The reason Commercial suffers is because Residential suffers more. Residential made 200% more GDP than Commercial at the height of the boom. Since 1980 it has made more than 35% more GDP. Residential guides the building industry, not Commercial. It wasn't a Library Bust or a Stadium Bust, it was a Housing Bust that took out the entire industry, including Commercial because in the end the lending all comes from the same banks.

-------------------------------------------
Eric Rawlings AIA
Owner
Rawlings Design, Inc.
Decatur GA
-------------------------------------------