Appraisers’ GLA vs Assessors’ GLA
GLA in your appraisal reports being questioned
Appraisers,
today (4/30/15), Freddie Mac released a document showing Warning and Fatal codes that will trigger if certain items are found in your reports sent to Freddie Mac through the Uniform Collateral Data Portal (UCDP), as of June 30, 2015.
In 25 pages of codes, only 4 are ‘fatal’ and those are for items you should not be overlooking. See the PDF below and take a moment to look over the document.
The very first ‘warning’ code is this one, which has two variations:
| FRE1001 | The gross living area for the subject property ([GLA] sf) varies by more than [X]% and [Y] sf from public records ([GLA] sf). Please confirm the reported gross living area for the subject property is accurate and adequately supported. |
| The gross living area for the subject property ([GLA] sf) varies by more than [X]% from public records ([GLA] sf). Please confirm the reported gross living area for the subject property is accurate and adequately supported. |
In our profession, industry, avocation, or whatever you choose to call it, the incorrect assumption by many people is that ‘public records’ are always believed to be 100% correct. They are not in many cases. Assessor appraisers often don’t actually measure homes! I know, blasphemy. But it’s true based on the class I gave to local assessor appraisers about how to measure dwellings who told me exactly that.
In reports I review, I seldom see statements saying the appraiser actually MEASURED the dwelling. So if you don’t tell people you did, why should they believe your GLA number more than PUBLIC RECORDS which may be inaccurate?
So put a statement in EVERY report that you did measure. Say something like
“Appraiser’s measurement may vary from that found in other sources, and is deemed more reliable for this report.” And when your measurement is significantly different from PUBLIC RECORDS, tell the reader that your measurement is X% larger or smaller “due to assessor measurement error.”
I’m serious about that statement. I never get questioned about the GLA I report. My comment is at the very top of page 3, in that big blank comment section many appraisers don’t use.
Dave Towne on e-AppraisersDirectory.com
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i predict in the next 5 years or so, that our reports will be 60 pages long. 58 of those pages will consist of nothing but CYA and limiting condition/assumption statements, and only two pages of the report will be the actual appraisal of the property.
the bleeding continues . . . . .
I borrowed this from another appraiser and include it in my reports:
Assessor’s GLA calculations often include below grade finished area. The reason for this is that many assessments in my area are based on current use. Not actual GLA.
another thought.
everyone wants our reports to be as correct as possible, including us. yet, we all know the realtors often times dont do their jobs recording and downloading accurate MLS data, and we also know the information we get from the assessors office can also be just as unreliable. we have all known this for a VERY LONG TIME.
so who holds these people accountable? why are we again, the ones being held accountable for inaccurate information, when we cant get accurate information from anyone in the first place?
why are the state boards not prosecuting and fining realtors for THEIR sloppy work and not doing THEIR jobs? (probably because they know they would be constantly flooded with complaints?), why isnt anyone doing the same with the local assessors offices? why is it that these people do not seem to be as tightly regulated as we are? assessors offices are not required to measure the houses they assess? nobody sees a problem with that? really? (i know for a fact that thats the case where i live too).
if the banks, the states, the feds, whoever, want accurate information from us, then accurate information needs to be provided to us in the first place. if realtors arent capable of doing their jobs and cant provide the accurate information everyone is demanding nowadays, then fine them, prosecute them and threaten to take away their licenses too.
its time for people to get off our backs, and start addressing the other problems that are out there..
the bleeding continues . . . . .
One reason why…we don’t have lobbyists…that’s why they pile on our (appraisers) backs!
There should be some sort of rule for these entities to cross check assignment type with the GLA. SO, it its a drive by assignment the GLA (unless you have measured it before) should be equal to the public records data.
If it is an interior assignment or one where the report relies upon the appraiser’s sketch then that rule should be dropped. In no way shape or form can public records data supersede or should it supersede what the appraiser has measured.
Soap box warning:
Public records data always has statements tied to it that it cannot be relied upon. At least it does in my market anyway. When do we as a profession stand up and say , this is the acceptable method for measurement – and pick one. I don’t care if its ANSI or the American Standard – lets pick one, go with it and hold everyone accountable to that. Our profession is regulated by everyone. We do not create data – we report it . If the sources that we have to rely on cannot be “reliable” – then start with those sources and make changes.
It is absolutely ridiculous that we need a check of our report for our subject GLA that cannot be relied upon from the source they are using!
Dave,
I don’t know what your appraisal reports look like, but my page three is COMPLETELY filled up. With an interior appraisal I state “Subject GLA obtained by appraiser measurement during inspection”. That’s all their getting. If they don’t understand that they need to get further educated.
In two of the counties where I appraise the assessors do not give out any information to the public. It is considered personal information that is the homeowners only. They were taken to the state Supreme Court to get the information released and the assessors prevailed. In order for me to look (no copies) at the information I have to give a lot of my information, reasons for needing that info and have to sign in with my credentials to retrieve it. Most realtors in the area leave the sf info blank on the MLS sheet. They say their afraid of being sued for incorrect information. The local MLS can’t have the info either.
In another county tax assessors method is for every colonial it’s base x2, every Cape Cod it’s base divided by 2 then added to base and if the basement is part/full finished they add it to the GLA and will not tell you the difference.
CU needs to start giving appraisers our information!
Be careful what you wish for Koma, because shared database information is not reliable from the start. Without assessors comparative and standardized information, you simply need to keep on trucking and go about it the hard way, if that is what is necessary. I’ve seen quite a bit of problems with shared database information regarding home sizing lately. Everyone who thinks that their 100% accurate laser measuring device is helpful to the process, is generally wrong. When you measure in a way which varies from assessors standardized measurements, you’ve merely improperly influenced valuation as a result, unless you apply that same measurement standard to your comps. Therefore you should adjust minor differences down to match the assessors, unless there is actual real property alteration to consider. One reason why I still use Apex Medina and do only manual sketches with a tape. And I have that uncoupled from Alamode as a stand alone sketcher so I don’t have to pay that absurd yearly integration fee, and I simply print the sketch to pdf and include it in the report. Manual process is preferable, especially in a climate where a computer will auto compare your results to assessment data. Don’t get all gung ho about laser sketching just yet, until such time as the assessors themselves actually use that technology for county reporting. Tech and informational companies are not appraisers, but that certainly does not stop them from making fantastical claims that they can better the process with new age shoot from the hip technology. The value of pen and paper is that a human remains in control of all the processes at hand, and actually understands the processes employed to reach conclusions.