Captain Morgan and Contessa Rumm of Humdrum are facing a…

CaptainTitanium162 Captain Morgan and Contessa Rumm of Humdrum are facing a…Captain Morgan and Contessa Rumm of Humdrum are facing a conundrum. They wish to retire within the next year and plan to move from Humdrum, California to a seaside village in Mexico. Therefore they will need to sell their home. Contessa is already in Mexico looking for a new property while Captain Morgan is responsible for selling their existing home.The subject Humdrum property was built in 1940. The Rumms have lived in the property since 1976 and the house is considered to be in overall poor condition with significant code violations. No lender will lend on this property due to its poor condition and code violations. The subject neighborhood has changed dramatically over the past decades. All the other market area homes have been either completely torn down or are far larger sized homes upgraded with pricey renovations. The subject property is a two bedroom two bath, 1,250 square foot home surrounded by three to four bedroom 2 to 3 bath homes that are now 2,500 square feet or more in size. The subject property is considered to be an under improvement for the neighborhood. Their property is also zoned for commercial use as well since the town is under redevelopment and they have one of the biggest lots. Although the lot is oversized, it consists of surplus land that cannot be divided separately.By law, a commercial appraiser is required to appraise a home on a commercially-zoned lot. A commercial appraiser has just valued the Rumm’s property as an under-improved single-family house with a market value of $580,000 “As-Is” or a market value of  $610,000 vacant for commercial development. Developers in Humdrum are eager to purchase property in this area of Humdrum for commercial development. The cost to demolish the house was bid at $35,000. However Captain Morgan’s best friend, who is a state licensed demolition and asbestos contractor, said he would tear down the home for $15,000. This $15,000 demo cost includes clearing and haul away, an asbestos survey and removal of any and all asbestos in accordance with current building code.Question 1: From a valuation perspective, what should you recommend the Captain do, and why?Sell their property “as-is”Have their house demolished and sell the vacant lotRemodel the home to improve the value and sell it for moreIt does not matter whether they decide to tear down their house or not because they would make the same amount of profit in the endQuestion 2: Which one of the 14 Valuation Principles supports the BEST choice? Which of the remaining Valuation Principles provide secondary support?BusinessBusiness – Other