Tagged: comparable sales

Baby or Bath Water? And Is it Time to Take Back USPAP? 31

Baby or Bath Water? And Is it Time to Take Back USPAP?

About half of AICPA members don’t believe in USPAP… When I first heard that “they” were trying to do away with the Appraisal Practices Board (APB) of the Appraisal Foundation (TAF), I tried to keep an open mind. I also wondered who “they” are. Did the Appraisal Institute (AI) finally get a sympathetic ear in Congress? Was it preemptive action by the Board of Trustees in anticipation of budget cuts by the new administration? By the way, what does the APB do? I certainly had it wrong. I thought they helped develop the Advisory Opinions (AOs)! To be candid the...

Rating Number Game Threatening Appraiser Independence 23

Rating Number Game Threatening Appraiser Independence

CU rating number magically moved lower on the scale… Appraisers, While it’s presently a tad bit slow for order volume, this is a good time to evaluate a potentially troubling item instituted by Fannie Mae in conjunction with their Collateral Underwriter (CU) review process for appraisal reports. This has the ability to be abused by lenders and AMC’s. Hope you will take time to peruse this message and the podcasts. Unfortunately, we need to get a bit deep into the weeds here so that you get a grasp on potential challenges some ‘intended users’ may have with your reports. I...

Hybrid Appraisals – Why They Are Impacting Appraisal Employment 22

Hybrid Appraisals – Why They Are Impacting Appraisal Employment

How hybrid appraisals may impact your future Appraisers, A day or so ago, I found out about the rebranding of ZAIO into Clarocity, and their purchase of Valued Veterans AMC. The ‘new’ CEO of the Canadian/USA company, formerly ZIAO, now named Clarocity, was recently interviewed. Take the time to actually read this interview. If you have forgotten, ZIAO came into the US in about early 2008 or so with the intent to develop property data bases in most urban areas – with photos, that could be re-used by various entities. They sold ‘zones’ to a number of appraisers, expecting them...

When Residential Appraisers Fail to Bracket 5

There Go My Brackets

When appraisers fail to bracket… Forget college hoops and all of the upsets. This is about the upsets that occur when residential appraisers fail to bracket. Say that your subject property has a contract for $102,900. Ideally your three sales should surround the contract price like a cozy, warm blanket. Comp #1 might end up, after adjustments, at $100,000. Comp #2 might reach $102,500 and Comp #3 might conclude at $104,000. Yay! All you need is a pretty bow and you can deliver a lovely report to your client. But…it really doesn’t work that way on most days. Does it?...

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Safe Room Adjustment in Appraisals

Use of a Safe Room has Increased by Property Owners Appraisers, If you’re doing a standard 1004 SFR, or 1073 condo (or perhaps a Co-op), report and encounter a “Safe Room“, you might need to add that to one of the extra adjustable component lines on the grid. The trick however, is how do you determine the value of such a safe room and apply a proper adjustment? I suspect they vary in size, interior amenities, vault door construction, and bazooka stopping power of their perimeter wall structure. I dunno! If encountered, I think I’d call Jonathan Miller, who is...

Adjustment Values, Frequency & Dollar Amount 17

Adjustment Values, Frequency & Dollar Amount

Ever wondered what other appraisers are doing with adjustment values? Appraisers, Have you ever wondered what other appraisers are doing with adjustments in their reports? CoreLogic has done research over the past 3 years, using 1.3 MILLION+ reports, and has produced the graph attached here.  You may want to print this for reference. This graph shows the percentage of time a certain feature is adjusted, and the average dollar amount of the adjustment for each of those. It’s rather interesting. The highest amount of adjustment, approximately $14,000, is for the Quality Rating. Not really surprising as to the amount, but the percentage...

FHA Appraisers Increased Liability & Responsibilty with New FHA Requirements 27

FHA Appraisers Increased Liability with New Requirements

FHA Appraisers Increased Liability & Responsibilty with New FHA Requirements Excerpt New FHA Requirements Put More Responsibility and More Liability on FHA Appraisers After reviewing the new HUD handbook, my overall conclusion is that there were not many changes to the overall requirements other than the word MUST. The prior handbook was a list of items that should be completed and verified whereas the updated HUD handbook clearly states that the properties MUST meet these items and the appraiser MUST verify the items in question. The following is a list of FHA requirements that MUST be completed and verified by the appraiser....

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It’s Not a Comp, It’s a Sale; Stop Fannie Mae Lies!

It is merely a SALE… Appraisers, Something’s been gnawing at my craw ever since January when FNMA’s wonderful Collateral Underwriter (CU) was unleashed to the world. And before that, when FNMA’s Appraiser Quality Monitoring (AQM) process was introduced to judge the work of appraisers. No one else has written about this. No one has even mentioned it. So I will:  It has to do with the word “Comp” which is used liberally by Fannie Mae (FNMA). What exactly is a “Comp?” In FNMA’s world, it’s any property that they obtain, either by their vast AVM process which examines millions of...

Appraisal Bias Appraiser Pressure ~copyright AppraisersBlogs 9

Appraisal Bias and Appraiser Pressure: Why All Appraisals are Always Wrong

Some appraisers give in to pressure… Real estate markets cooled down in the fourth quarter of 2014, and despite historically low interest rates, refinance volumes dropped as well. The increasing pressure on lenders and real estate agents to maintain loan and sales volumes has brought about renewed interest in appraisal accuracy and increasing concern that residential real estate appraisals are inflated. A recent Wall Street Journal article asserts that “home appraisers are inflating the values of some properties they assess (appraise), often at the behest of loan officers and real estate agents, in what industry executives say is a return...

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CU and Appraiser Regulation

Whether you believe Fannie Mae’s comprehensive rollout of Collateral Underwriter will finally weed out the lazy form-fillers or it will end up euthanizing the aging residential leg of the profession once and for all, is not the subject of this article. There are plenty of blogs, articles, and seminars that are wrestling with the efficacy of CU and its long-term impact. To be sure, the profession has entered the new age of big data. Residential appraisers will need to navigate regression analysis, heat maps, trend lines, oblique aerial images, and especially how to tie it all together into something meaningful. From...

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