Up to Our Knees,
Not Out of Our Depth
Every appraiser knows while inspecting a property, a surprise could be waiting just around the bend: as we cross a train track, out of nowhere a train approaches; as we explore an abandoned warehouse for the source of a rattling sound, a rattle snake slithers by …so what happens when you find yourself appraising on an island?
In the spring of 2018, that is exactly where the appraisers at North by Northwest Consulting found themselves. The appraisers were assigned to conduct appraisals on Colington Island for the North Carolina Department of Transportation’s R-5014 project along Colington Rd, Kill Devil Hills, in Dare County. Island terrain presents an interesting list of challenges.
Colington Road is a 4.3-mile long corridor in Kill Devil Hills, NC, running west to east on the Albemarle Sound side of the Outer Banks, from Colington Island itself to the larger barrier island between Kitty Hawk and Nags Head. It is an area well known for famous shipwrecks and legendary storms. Atlantic hurricanes mean it’s no stranger to “weathering the storms” and the flooding and winds that attend them.
In total, North by Northwest Consulting appraised over one hundred parcels with an appraised value in excess of $4MM since March 2018. It would seem clear enough when approaching those parameters, but getting to the finish line was a wholly unexpected learning experience: how to best appraise land on an island.
Location Location Location
The Department of Transportation engaged this project to aid in the island’s unique flooding issues, with water surge from storms, and flooding caused by driving winds. The flooding also caused Colington Road to be impassible, leading to loss of property and even death as emergency vehicles were unable to get to residents in need. To alleviate this problem, drainage pipes were added along Colington Rd., and in places, the road was raised and straightened. As an added benefit, seven-foot wide asphalt bike lanes were to flank the road. Colington Road is considered to be one of the most traveled secondary roads in North Carolina, and such additions would not only help with water issues, but also increase travelers’ safety, while adding the benefit of allowing tourists and locals alike to bike comfortably and safely through a truly scenic historic area.
So, we have an island location and the need for the right of way project. But how do we conduct valuations where a significant percentage of the subject parcels are located on marshlands, and where buildable land is scarce? The roadway uses buildable land, so improvements are often very close to the roadway. This in turn means it is extremely difficult to find comparable sales with buildable land, along with comparable marsh land on most subject properties.
Womp the Comps
To complicate the comparable search further the area had water frontages and water views, including varying canal and bay frontages, which impact market value. When analyzing comps for their use in a report, research on bulkheads, water depth, and access were all conditions that are not typically assessed in everyday appraisal assignments conducted by most appraisers.
And then, there was the problem of comparable location in a highly sought-after Outer Banks real estate market. Most of the subject parcels right along Colington Road were older single-family residences with a larger distance between them than the much newer homes sales found in or near the Colington Harbour neighborhood. Colington Harbour was a newer and more desirable area, where the developer had packed the land down to be buildable, and made use of that buildable land by dense housing construction on small lots. Indeed, the growth of Colington Harbour, located at the terminus of Colington Road and the ‘end’ of Colington Island was a major factor warranting the project.
However, finding comps wasn’t the only challenge that produced more educated appraisers at the resolution of the projection. Appraisers found themselves engaged additionally in a crash course in subject proximity to roadways. The proposed right of way was so close to some of the properties that it was often necessary to determine whether the property could be spared damages. This isn’t uncommon in appraising for right of way projects, but is vastly different when the home is in a location such as Kill Devil Hills, on the Outer Banks of North Carolina – a location which makes many homeowners’ dream come true. One house sat in a curve in Colington Road, creating a right of way so close to the home that the homeowner would need to step into the road to exit the home. Of course, this homeowner would inevitably need to relocate.
But Wait There’s More
In a follow-up post, we’ll explore the challenges met in this project in more detailed technical terms. There we will aim to shed light on our most coveted nuggets of appraisal knowledge. But don’t worry, we won’t make you wait until then for a deeper glimpse into the wonders and the invaluable historic importance of Colington Island and its culture.
The Right of Play
Dare County is home to a soaring historical moment, lush scenery that would make any appraiser reach for their camera, old crusty seamen who weren’t taking a shine to the road project, and a restaurant so delicious we couldn’t neglect to mention it.
First up: first in flight, the Wright brothers. Colington Road runs directly through the Wright Brothers Memorial property on acreage facing away from the visitor center. While visitors cannot actually access the memorial site from Colington Rd, and although none of the property owned by the Wright Brothers Memorial site was assigned for appraisal, the significance of what happened on the memorial’s site was not lost on the appraisal staff. It was here that Orville and Wilbur’s flying machine first soared giving birth to aviation. As you might imagine, photo ops were plentiful.
While completing the project, our staff were fortunate to meet the grandson of a man who saw the Wright brothers take flight for the first time. A statue on the memorial site depicts his grandfather, arm in the air, gaze to the sky, as he stood watching that first flight. One appraiser said meeting the grandson of someone who witnessed the event was the highlight of the entire project for him.
Another highlight is perhaps better described as local color. Some of the local seamen saw the road project as nuisance. Interactions with them were memorable – an opportunity for practice in negotiation, patience, and tact. Our time with them developed a healthy respect for the men and women who bring the ocean harvest home.
To sample the local seafood after a long day, some of the appraisal staff would kick back and with an Ölsch! and a hearty meal at The Outer Banks Brewing Station. For those looking for a little something sweet, Duck Donuts, had just the treat to enjoy while reflecting on scenes like these: