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Next step in paired sale analysis

Discussion in 'General Appraisal Discussion' started by ROBERT JONES, Jun 21, 2011.

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  1. ROBERT JONES

    ROBERT JONES Junior Member

    0
    Feb 12, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    New Jersey
    TRying to extract IG Pool reaction

    Sale A with pool is 2084 sq ft - sold for $350000

    Sale B without is 2292 sq ft - sold for $337,500

    Market reacts to gla differences at $32 per sq ft

    I can't remeber if I subtract the $6656 (208 sq ft at $32) to sale B or add it and then calculate the difference

    Please don't beat me up with criticism - just need to be refreshed and cant find a clear refrence anywhere.

    thanks!
     
  2. cjski

    cjski Junior Member

    0
    Jan 24, 2009
    Professional Status:
    Licensed Appraiser
    State:
    California
    Subtract the $6,656 from the sales price of $337,500. That's what the additional gla contributed to the sales price. Your left with ~$331,000. The difference in this amount, and the amount of sale A is theoretically is the contributory value of the pool.
     
  3. CANative

    CANative Elite Member

    68
    Jun 18, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Do this for a hundred more and then you'll have a good basis for the adjustment using this method.
     
  4. panappr

    panappr Senior Member

    3
    Dec 5, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Kinda like a drill Sargent telling his troops to drop and give me a hundred. :rof:
     
  5. CANative

    CANative Elite Member

    68
    Jun 18, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Using a single sale to isolate an adjustment doesn't work. But it could be used to ward off stupid AMC stips. :icon_idea:
     
  6. David Mescon

    David Mescon Senior Member

    4
    Nov 12, 2009
    Professional Status:
    Retired Appraiser
    State:
    California
    Why of course it does! Everyone knows that paired sale analysis is THE preferred method for determining the contributory value of an element of comparison. :) Oh wait - I just found another pair indicating a completely different value. and wait - there's another; and another; and another. Geez, I guess I'll just have to add 'em all up an find the average. :rof:
     
  7. PropertyEconomics

    PropertyEconomics Elite Member

    0
    Jun 19, 2007
    Professional Status:
    Certified General Appraiser
    State:
    New Mexico
    It doesnt matter whether you subtract from B or add to A ... as long as you hold one sale constant and adjust the other sale to the constant sale (in paired sales analysis) for all value differences, (garage spaces, square footage, patios, etc - excepting the item you wish to measure) the indication should be the same.

    If you have one sale with a pool you can compare it with several other non pool sales to get an indication of the range that pool contributes. It would be preferrable to have many unrelated comparisons but you can still compare what you have to provide a range of indicators based on market analysis.
     
  8. Mile High Trout

    Mile High Trout Elite Member

    2
    Feb 13, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    Colorado
    Just worked a high end Boulder area, well probably not high end to your guys standards.

    Builder had $50k lot premiums about a decade or so ago, for incredible views.

    I was struggling with the lot premium adjustment in todays market.

    Found several examples of paired sales which made me smile at how easy they were.

    Nearly identical homes directly across the street from each other. One had views, the other did not. Voila! Around $50k, still relevant in today's market. A few more less straightforward pairs based on views, and a logical paired sales analysis to extrapolate market reaction actually came forth. It's almost a miracle, but without the miracle part.

    In CO, you don't do that with pools though. Winter ruins pools, and you have to practically be a super pool hero to keep the value in your pool for more than a decade, if even that. When they install them with methods not sound to CO, they can become a detriment after only one or two seasons, even if still sort of functioning correctly.

    Sometimes the market reaction to items or influences can be an estimated figure, without much evidence to back it up. It's all about offsetting comparisons and market expectations for the specific area. It's just opinions, and in the case of an individual line item consideration, that appraiser opinion of market reaction can be logically based on weather the consideration is common for the area or not.
     
  9. ROBERT JONES

    ROBERT JONES Junior Member

    0
    Feb 12, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    New Jersey
    Thanks! I needed something for the work file just because there is an extreme lack of pools in this market area.
     
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