Assessed value runs in arrears to market value. It’s a catch up game which protects citizens from over taxation. It appears you’re close to extracting a reasonable multiplier, you’re all good. That’s a great quickie product I could get with; extracting the current average assessed vs market value multiplier so the lender can run a quick deal based on the tax value scaled up to estimated market value. I do that every single time when I scale up the land value for 1004’s… I’ve said it before, they’re burying QE in real estate. Nobody is stopping to consider the consequences of rapidly rising house pricing.

Yes, but that’s likely a consequence of certain strategic tax planning, low mill levies, a lot can play into that. It would appear you’ve already extracted the multiplier, you’re all good.

In ct the assessed value is 70% of the appraised value which is supposed to be based on comparable sales.

“No AVMs – use tax records instead? Would that rock the world of big banks and AVMs? Just imagine if the only people allowed by law to profit from the appraisal business were those who invested their time, talents, and money to earn a license. Think about that a minute…”

Baggs,

The AVM fees are controlled en grosse ‘by the marketplace.’ Don’t confuse that with being the same as the marketplace of appraisers.

An AVM approaches a bank to get all or big chunks of their appraisal management work. It’s at this stage where the bracket of allowable fees is established. Long before any appraiser has been contacted. Any appraiser fees must necessarily fall within that preset bracket…regardless of appraisal complexity. We are finally seeing a very few exceptions due to appraisers push-back for C&R fees.

Depending on whether the banks (or direct lender) decision maker also takes a kickback per appraisal, or the bank has simply based what they are willing to permit their customers to be charged; a flat fee is established. Usually it is $650. In some instances it may still be as low as $500 but the vast majority of lenders set it in the $600-$650 range. (Smaller AMCs with fixed offices and staff require $75 to $150 per order to break even or profit)

This goes back to when Brian Coester’s VMS advertised that they were the first ones offering a national flat rate AVM fee. Everything since then has been competition among AMCs for banks business.

AMCs already know where they can still get $225 to $300 appraisals. That is their preferred ‘tier 1’ (contrary to Mr. Hagar’s belief that tier 1 stems mainly from appraisal quality). IF they can’t get one of the lowest fee appraisers to do the job, then they will consider paying up to $400 MAYBE even $450…but you can immediately see what that does to their profits.

So, what happens when the job complexity calls for a fee of $650 (or more)? IF they are doing it for a good client or one they are afraid of losing they may take no profit on one periodically.

So what happens when the fee must be $1,000 to $3,000? AFTER they run through all their lowest; lower, and slightly low appraiser fee panels they may communicate to the client that they can’t get anyone in the range. Once in a great while (rare) a fee up to $1,000+- gets approved though anything above that is truly rare.

Appraisers setting their own fees? Only those of us that can and have walked away from AMC work.

How are avm’s managing flat fee realty? Hell, the human agents are in a stir and can’t figure it out. And what, am I supposed to adjust up or down, look at net, all while not being able to even speak to the listing agent? Next time, I’m passing that nonsense to the other guy. Is CU even considering the influence of flat fee realty? Doubtful. So let’s check the scorecard, avm’s are built on assessed data via sales records. Final sales pricing are increasingly based on avm and waiver programs. This is what happens when you trust a tech programmer to do the job of a real estate professional, calamity ensues.

You trust those people right…. They’re all to willing to take it up, good luck getting them to take it down. They live and die by the mill levy. Therefore; read my lips; No New Taxes! “If Americans had to get out their checkbook and write a monthly and yearly check for all the taxes they actually paid, actually paying it out of pocket, the government would shrink in size overnight.” Ron Paul.

Don’t tell the assessor they’re 50 years behind on data entry from the building department, they simply don’t have the budget for that. It’s a tricky area when dealing with borrowers. I tell them it’s not my job to tattle to the assessor, but if they were to actually sell, they’ll want to self correct that discrepancy, otherwise they’re quite often saving a few bucks on slightly low assessment. Illusions in real estate. If you’re a good boy and always get permit approval, you get a hella lot more tax than the guy whom does not, as you’ll be categorically rated in a lower less improved tier category. Often assessors look categorically in terms of quality valuations, they track that via quick drive by’s, but primarily through permit and improvement validation. Things they don’t tell you in real estate school. Do you think your average non licensed appraisal assignment person could keep up with this? What’s your fee and turn time, by the way?

I tried, really felt sorry for the transferees, nice young couple. They bought it from the same agent it was listed with, and she never caught the error in the beginning when she listed and sold it to them the first time.

Saddest part to me is not the error, but the unwillingness to admit and correct it. kudos to you for trying to fix it.

Last year I was doing a relocation appraisal in large city in lower CT. after inspecting the property and comparing my measurements to the tax records I found that the square footage was over 950 more that actually existed. The listing agent never bothered to measure the house or check the field card and compare it to the property so the listing information was wrong too..

I contacted the property owners and advised them to contact the Assessor because they have been overpaying on taxes for at least 4 years based on the square footage.and it amounted to over $8,000 They were ignored, I then contacted the Assessor on their behalf, calling several times and finally sending a registered letter, which was also ignored.

After several weeks, I was finally put through to the Assessor who kept skirting the issue, saying he has been appraising for 12 years and there can’t be a problem, I said I’ve been appraising over 45 years and you are wrong and these people are getting shafted. He got very nasty and I finally hung up on him, which I’m sure he was hoping I would do.

The difference in GLA along with my comments about the taxes was in my report, I also contacted the relocation company to make sure they understood the problem and maybe would help the transferee get some money back. I don’t know the final outcome, I figured a month of my time was enough trying to help them, but this goes to prove field card information assessments can’t always be be believed.

I estimate that public records are incorrect 85% to 90% of the time. Sometimes the house is completely different due to the lag time in updating the records.

That has a very significant impact on value. We NEED real time and accurate information.

I never really thought about the fact that lenders could use many AVM’s until they find the value they need. Very interesting comment, but we need to see the property in real time with current market conditions.

And the assements in CT are 70% of market value, better hope the mortgage person in Iowa knows that

I read an appraisal yesterday from New Jersey. Assessor and appraiser are $100,000 apart on the land value. No idea whose right yet.

Truth is, that if consumers are willing to accept LOW to very low values for their loans, of around 50% to 80% of MV, then AVMs will thrive. If the feds are willing to let taxpayers keep getting fleeced, then the odd loans with 150% LTVs, wont matter.

I’ll offer a new appraisal service involving lawsuits on behalf of borrowers post-closing.

Seek the truth.