McClelland Minute - July 04, 2010

Unique Properties

By far the most difficult, and yet in contrast, the most interesting properties to market are those that are unique.  Unique in location, presentation, age, or purpose; in other words, not easily replicated or compared.  Fun to look at, difficult to place a fair market value on, and almost always, providing an extraordinary challenge to the Realtor to represent.

Now most appraisers and Realtors won’t admit this unless you get them “deep into their cups” but for all of the analytical principles they use when recommending a value can and will go out the window when dealing with a property with unusual characteristics.  Let me give you a couple of examples.

Some years ago I represented an acreage with a fantastic view of the North Saskatchewan River. It was almost exactly placed between Lloydminster and North Battleford, making it a rather lengthy commute for services, schools, and possibly employment.  Yes, it had a “million dollar view” and attracted a significant amount of interest as a result, but most buyers invariably backed away when faced with the question of whether or not it actually would work within their personal circumstances.  Is it worth more or less than a lake front parcel a similar distance from those two centres?

Who wouldn’t like to settle in the country with an established honey bee business?  Or let your creative juices flow with a flower and crafts shop?  Again, it requires a buyer who wants to be self-employed and has the right skill set to make it successful.  Since you are essentially buying yourself a job that will allow you to be nurturing and creative, it likely won’t make you rich, but it may satisfy other needs, and that counts too.

What’s an island with two log cabins thirty miles across two lakes worth?  Or a quarter of land covered with bush on the edge of the provincial forest?  Why is a 6,000 sq ft lot in the spruce 200 yards from a shoreline worth the same as 40 acres a mile away from the same lake? Actually sometimes, more land scares potential buyers; they don’t know what they would do with it particularly when they come from an urban circumstance where every foot of boundary is to be fought over.

Once in awhile, we get the chance to represent a beautifully refreshed home built early in the 20^th century.  These 100 year old properties often were made to last by craftsmen who took distinct pride in their work.  Sometimes, the entire home was shipped in on a railroad car; ordered from a catalogue.  Unfortunately, they may also lack certain design features that would make today’s buyer comfortable, such as a bathroom with second storey bedrooms, modern wiring, or insulation in the exterior walls.  If those same walls could talk what stories could they tell?

You can probably tell by now that I like what unique properties have to offer, unfortunately they can be very difficult to market.  There is often an emotional factor involved, and bankers don’t finance feelings.  However, I believe that valuation is both an art and a science, and I look forward to the next opportunity.

Vern McClelland is associate broker with RE/MAX of Lloydminster.  If you have questions or comments on this article or other real estate matters, he can be reached at 780.808.2700 or through the McClelland Group website www.mcclelland.ca

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