Chapter 22: Selection of Comparables

Anchor: #BIHIDBDA

Section 1: Selection Criteria

Anchor: #i999273

Procedure

Consider only properties meeting the definition of a comparable as replacement housing. As possible, select comparables within the neighborhood of the displacement dwelling or, if not possible, in nearby or similar neighborhoods where housing costs are the same or higher.

For replacement housing or rent calculations, it is preferred that three available comparables representative of the displacement dwelling be analyzed. Base a supplement on the comparable considered most representative of the displacement dwelling. R/W-PD must select the comparables and comparability should be the principal selection factor, rather than total index, listed price, assumed displacee needs, or stated displacee intentions. While innovative means of providing housing are allowed, they must be reasonable and cost-effective. When there is little difference between the quality, condition, or functional characteristics of available replacement dwellings, base selection on price.

If no decent, safe, and sanitary (DSS) dwellings that meet comparability requirements exist, use housing in the next higher category of the Residential Comparison Index (RCI) until a DSS comparable dwelling is found. Use sound judgment regarding the level at which to stop. When an available replacement dwelling is obviously mispriced relative to other comparables, do not use it in supplement calculations.

Do not include dwellings that are obviously not comparable to the displacement dwelling merely to list three replacement properties. When three comparables are not available, less than three may be used for Alternatives A, B, C, and E (see discussion in next section). This is only allowed on an individual basis. Include documentation explaining the reasons for using less than three comparables on form ROW-R-107. Only one comparable is required for Alternative D (see next section).

In the case of providing a replacement residential site, it is intended that normal site preparation costs should be included in the replacement site supplement.

If a comparable lacks a major exterior attribute of the displacement dwelling (e.g., significantly smaller site, swimming pool, comparable storage building or facility, storm cellar), subtract (“carve out”) the attribute value from the displacement dwelling acquisition cost when calculating the supplement.

Comparable replacement housing must be functionally similar to a displacement dwelling with particular attention to the number and type of rooms and amount of living space. While the replacement and displacement dwellings must perform the same functions, they need not be identical. For example, if a displacement dwelling contains a garage used as a laundry room, a replacement dwelling may use another space (e.g., a basement) to perform the same function.

A replacement dwelling need not duplicate specialized furnishings, such as custom kitchen cabinets, to be comparable. When evaluating comparability, give attention to the number of rooms and the amount of living space because these are major factors in determining if the comparable dwelling is functionally equivalent to the displacement dwelling.

Previous page  Next page   Title page