Five Methods of Determining Proximity Damages Presented in Descending Order
1. Matched Paired Sales • The perfect matched pair of the subject selling immediately before and after a widening project. • Matching similar residences along the same highway with different set-backs.
2. Collect After Comps • After comps are sales that are forming the indicated bottom of the market of properties that are similar to the subject. • Depending of the degree of proximity, one can slide along the range of difference in value from the subject as appraised before and the bottom of the indicated market. • Advantage; the method will reflect current market and location conditions.
3. Compare to Any Other Structure • Similar to method 2 but with a lesser degree of comparability. • One may need to compare bricks to frame and new to older homes. • Needs a greater degree of analysis and adjustment to justify.
4. Document the Market Perception • Almost an if all else fails option. • Get the opinion of realtors, developers and other appraisers as to how the proximity will affect your subject property. • Disadvantage; dealing with perceptions rather than market evidence.
5. Cost to Move the Residence. • Works well with mobile homes. • Useful in extreme proximity situations where one is on the verge of acquiring the residence. • Disadvantage; often not a physically feasible solution.
Conclusion • Proximity damages are relevant to residential properties. • Non-residential properties are usually damages by cost-to-cure, capitalized rent loss or change to a different highest and best use.