Appraisal Articles 2019 Free Appraisal Articles for Appraisers and the Public
For real property appraisers shipping containers that have been modified for a residential or commercial use are a lot like appraising trailers or mobile homes, they are usually classified as personal property with metal shell exteriors and after modification for some residential or commercial use they generally remain personal property.
If you do your research you will find that shipping container are commonly 8’ feet wide, and many are 20' to 40' feet long, so many who use them for single-family homes, guard houses, small offices or business pop-ups modify one or more standard containers. If you search you can find a number of modified shipping containers offered for sale on the Internet. It appeared to me that China was very active and competitive in the upgraded shipping container market.
Modifying a shipping container for a residential or commercial use can be an expensive proposition. While you are starting with a basic metal container that may arrive at your door with delivery for maybe only $ 2,500, but you have to think about what costs are involved in its conversion. Galvanizing the exterior, exterior paint, insulation, floor construction, windows, doors, walls, ceiling, air conditioning / heating, lighting, outlets, breaker boxes, plumbing, plumbing fixtures and the list goes on. If you don’t do shipping container conversions for a living you will find that you will be spending many of your waking hours doing it if you take on a conversion project, and it will be a long, arduous project fraught with problems.
Will a residential “pre-fab” shipping container advertised on the Internet for around $ 11,000 or about $ 70 per square foot (psf) work for you? If you are willing to live with the basics it will, but if you are looking for a customized layout or specialized finishes that price will be too low.
While I have also seen decent looking 8’ X 20’ modified shipping container retail “stores” advertised out of Shanghai with asking prices around $ 35,000 - $ 40,000 or about $ 250 psf, you really have to look closely at what is being included. Is it waterproofed? What kind of lighting does it have? If you are selling clothes or art, container finish does not have to be as high as the finish for some other products when you need plumbing, upgraded electrical services and air conditioning.
If you break down the cost of shipping containers by improvement type you will discover a relatively wide range, that looks something like this; unfinished containers, $ 12 psf to $ 15 psf, residentially finished containers, $ 60 psf to $ 150 psf, finished containers (basic) for office / light retail use, $ 80 psf to $ 200 psf, shipping containers finished for high end retail / restaurant with all services, $ 180 psf to $ 250 psf.
When you get to the extreme high end of the range many containers are custom built and are no longer really “shipping containers.” They may be fabricated to look like shipping containers but some are built to be wider with integrated electrical and plumbing systems and they can run in the $ 200 psf to $ 350 psf range.
2019 Update: Some banks and appraisers have contacted me regarding this article and it appears that to get funding and appeal to the Public shipping container properties are being described as "manufactured housing." I guess that once a container is changed from one or more rectangular boxes to a living area it is appropriate to call it something other than a shipping container and manufactured housing does describe it well. How do you know if the living area created is habitable? Thats a question for the government, I'm sure there are standards and its not for real property appraisers to make that determination.
For more appraisal information contact Glenn Rigdon MA, MRICS, ASA is a Las Vegas / Henderson Nevada appraiser at Horizon Village Appraisal who can be contacted via email or via his business website Appraiser Las Vegas (http://www.appraiserlasvegas.com), or you can also click on “Contact Us” on the home page of this website or visit my public profile at LinkedIn at http://www.linkedin.com/pub/glenn-rigdon-ma-mrics-asa/1a/30b/879/.
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