Tagged: comparables

October 22, 2012

Appraisal of the Industry

Of course any one who has bothered to open USPAP, or read the preface of any appraisal related book is very likely familiar with the valuation process. definition of the problem preliminary analysis data collection highest and best use analysis estimate of land value application of the three appraisal approaches: cost, market, income reconciliation of value estimates report of value Of course the application of this definition and process is where the fun begins. Definition of the problem… If I do not complete this report within the allotted 48 hours that has been so graciously allowed by the high pressure...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisers News / Customary & Reasonable Fees

September 26, 2012

Update on Financing Concessions for Comparables

Appraisers, The GSE’s have issued a UAD newsletter on Sept. 18, 2012. Mostly it has ‘stuff’ in it that appraisers should be doing, i.e., checking for proper UAD compliance prior to report submittal by using your report software on-board reviewer. However, this little gem is the last item on page 2: Update on Financing Concessions for Comparables The GSEs expect appraisers to determine the financing concessions, if any, for all settled sales used as comparables in appraisal reports. Appraisers are expected to do what is necessary to determine concession amounts through the normal course of business and not automatically default...

Appraisal / Appraisal News / Appraisers News / Fannie Mae - Freddie Mac / UAD / Uniform Appraisal Dataset

May 5, 2012

Sense is Like Courtesy It is No Longer Common!

common sense needs to take the place of algorithms and automated valuation models… I dealt with an old question recently that I felt was pertinent and worthy of repeating. The question arose in Brooklyn, NY when an underwriter demanded that the appraiser include the basement area as part of the gross building area when comparing the subject to the comparable sales. After all they reasoned, Fannie Mae guidelines, i.e. Property and Appraisal Guidelines, XI 405.07 state, “Gross building area, which is the total finished area (including any interior common areas, such as stairways and hallways) of the improvements based on...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisal Organizations / Appraisers News

March 1, 2012

Concessions – When & How Much to Adjust

There is a lack of consensus or understanding among appraisers regarding concessions paid to a buyer in a sales transaction. The focus here is on appraisals communicated via a current Fannie Mae/Freddie Mac form. The intent of this article is to bring some clarity to this topic, whether you’re appraising the property as a purchase transaction or using it as a comparable sale after it has closed. First, in your appraisal due to purchase, a concession to the buyer of the subject of your appraisal must be reported in the contract section of the appraisal report. However, you must remember...

Appraisal / Appraisal News / Appraisal Organizations / Appraisers News / Fannie Mae - Freddie Mac / IDFPR

February 21, 2012

Comparable Sales in Declining Markets

Appraisal Institute Helps Appraisers Choose Comparable Sales in Declining Markets The nation’s largest professional association of real estate appraisers published guidance to help appraisers know when and how to use distressed sales, such as foreclosures, as comparable sales. Such knowledge is particularly crucial in the current market where distressed sales are common, creating complex valuation challenges. The Appraisal Institute noted that appraisers often use comparable sales (or “comps”) to help develop an opinion of value. But in today’s distressed real estate market, many potential comparable sales represent foreclosed properties. Some owners have complained their home’s values have fallen because appraisers...

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