DEAR BOB: I’ve been a residential appraiser about 21 years so I remember the “good old” pre-license days. If I can stick it out another few years, I will be able to comfortably retire, thanks mostly to my realty investments. Although I am a very competent appraiser, and I try to comply with the stupid USPAP appraisal rules which nobody fully understands and which keep changing, you and your readers should understand the tough spot we appraisers are in. We depend on referrals from mortgage lenders. When a lender phones me (often a mortgage broker), he tells me the “number” he needs to make the loan. He almost always says, “If your appraisal isn’t close to that value, phone me before you write up the appraisal.” But the homeowners can be even worse, especially on refinances. They also tell me the appraisal amount they need. That’s why I now demand the homeowner pay my fee in cash or a cashier’s check because I’ve had too many “stopped payment” checks. Just thought you should know “the rest of the story” – Joseph H.

DEAR JOSEPH: I understand the mixed-up appraisal industry situation. After reading several appraisal publications each month, it amazes me why any fully aware person would want to become an appraiser today.

Purchase Bob Bruss reports online.

Thanks for your honesty explaining the difficult situation residential appraisers are in trying to satisfy both the lenders and the homeowners.

But I also understand why the federal and state appraisal regulators keep trying to tighten the appraisal rules because of all the fraudulent appraisals. Hardly a month goes by without several appraisers being convicted of fraud involving mortgages. Without a corrupt appraiser, mortgage fraud is almost impossible.


DEAR BOB: A large tree sits on the property line with my neighbor. A decade ago, the neighbor installed a fence on the property line up to the tree, but jogged the fence on their side of the tree. The property recently sold. Does the tree become my property at some point? – Paul S.

DEAR PAUL: No. Fences do not determine property boundaries. The one exception occurs when the true boundary cannot be determined from public records and surveys. Then the doctrine of agreed boundaries might apply between neighbors.

Just because your former neighbor built a fence that jogged around the tree doesn’t mean the tree automatically belongs to you.

However, if this situation continues for a long time, you could prove your right to a prescriptive easement to own the tree.

If your goal is to cut the tree down, why not discuss the issue with your new neighbor? You might suggest equally splitting the tree removal cost so he can build the fence on the property line and you get rid of an offensive tree. For more details, please consult a local real estate attorney.


DEAR BOB: You recently wrote “To qualify (for the $250,000 or $500,000 exemption), Internal Revenue Code 121 requires owning and occupying your principal residence at least two of the five years before sale. However, if you acquired your home in an Internal Revenue Code 1031 tax-deferred exchange and later converted it into your principal residence, for sales after Oct. 22, 2004, you must have owned it at least five years (but only two years of occupancy is required).” If I acquired a residence property in December 2003 in an IRC 1031 exchange, how soon can I convert it to my primary residence? – William S.

DEAR WILLIAM: Nobody knows for sure the answer to your question. To show rental intent at the time of your tax-deferred exchange, most tax advisers suggest renting the acquired house or condo for at least six to 12 months. You appear to have done that.

Therefore, you can convert that residence acquired in a tax-deferred exchange into your principal residence. However, to qualify for the $250,000 principal residence sale tax exemption (up to $500,000 for a married couple filing jointly), Internal Revenue Code 121 says you must occupy the home at least 24 of the 60 months before its sale.

The important tax law change, effective for home sales after October 22, 2004, says if you acquired your principal residence in an IRC 1031 tax-deferred exchange, you must own the property at least five years before claiming your IRC 121 tax exemption. But you must occupy the home only two of the five years before the sale. For full details, please consult your tax adviser.

The new Robert Bruss special report, “How the New Tax-Deferred Realty Exchange Rules Can Make Your Very Wealthy,” is now available for $4 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet download at Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his
Real Estate Center


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