Real Estate Appraisal Forum

appraisersforum.com logo
The Premiere Online Community for Real Estate Appraisers!
 Fastest Way to Find a Real Estate Appraiser Enter Zip Code:
 
 
Go Back   Appraisers Forum > Real Estate Appraisal Forums > General Appraisal Discussion
Register Help Our Rules Calendar Archives Mark Forums Read


Closed Thread
 
Thread Tools
  #1  
Old 11-08-2009, 12:35 PM
jmarch305's Avatar
jmarch305 jmarch305 is offline
 
Join Date: Mar 2008
Location: Gilbert
State: Arizona
Professional Status: Certified Residential Appraiser
Posts: 164
Default Anyone get this stip?

"Explain why market conditions shows "stable" while, www.fhfa.gov, shows declining trend."

I am just explaining to the UW that the appraiser researched closed sales within the described neighborhood boundaries within the prior 12 months and the general trend is stable as of the effective date. Also, this method is more accurate in determining the trend than a zip code, city or state analysis.

Any thoughts.
__________________
Appraisers Unite!
Sponsored Links

  #2  
Old 11-08-2009, 12:42 PM
Randolph Kinney Randolph Kinney is offline
 
Join Date: Apr 2005
Location: SoCal
State: California
Professional Status: Certified Residential Appraiser
Posts: 19,952
Default

Quote:
Originally Posted by jmarch305 View Post
"Explain why market conditions shows "stable" while, www.fhfa.gov, shows declining trend."

I am just explaining to the UW that the appraiser researched closed sales within the described neighborhood boundaries within the prior 12 months and the general trend is stable as of the effective date. Also, this method is more accurate in determining the trend than a zip code, city or state analysis.

Any thoughts.
UWs don't know your market and the specific neighborhoods. They rely to some degree on the FHFA or Case-Shiller indexes for trends.

I put in the chart that my local MLS generates for the zip code the subject is in and I contrast that with the neighborhood chart that I make.

The explanation between the two? The zip code chart shows all sales, all listings, all GLA, all ages, etc., with no filtering to make it a reasonable comparison to the subject as what comparables are doing.
  #3  
Old 11-08-2009, 12:43 PM
Happy Val's Avatar
Happy Val Happy Val is offline
 
Join Date: Oct 2008
Location: At my house
State: Oregon
Professional Status: Certified Residential Appraiser
Posts: 197
Default

I just note that it was taken from a smaller sampling of properties and therefore may not match the information on page 1 of the URAR.
__________________
If you have integrity, nothing else matters. If you don't have integrity, nothing else matters...
  #4  
Old 11-08-2009, 01:08 PM
Mike Kennedy's Avatar
Mike Kennedy Mike Kennedy is offline
 
Join Date: Sep 2003
Location: Southern Hudson Valley
State: New York
Professional Status: Certified Residential Appraiser
Posts: 28,111
Default

......because the Generic Basis FHFA's Index is NON-SPECIFIC containing reams of NON-RELEVANT data which has absolutely no bearing on the subject's immediate neighborhood nor LOCALIZED market value trends for the most similar, proximate, and recent properties which would directly compete with the subject property.

"Background
FHFA’s purchase-only and all-transactions HPI track average house price changes in repeat sales or refinancings of the same single-family properties. The purchase-only index is based on more than five million repeat sales transactions, while the all-transactions index includes more than 36 million repeat transactions. Both indexes are based on data obtained from Fannie Mae and Freddie Mac for mortgages originated over the past 34 years.

FHFA analyzes the combined mortgage records of Fannie Mae and Freddie Mac, which form the nation’s largest database of conventional, conforming mortgage transactions. The conforming loan limit for mortgages purchased since the beginning of 2006 has been $417,000. Loan limits for mortgages originated in the latter half of 2007 through Dec. 31, 2008 were raised to as much as $729,750 in high-cost areas in the continental United States.


The American Recovery and Reinvestment Act, enacted in February 2009, extended those limits for 2009 originations in places where those limits were higher than those originally calculated for 2009.

This HPI report contains tables showing: 1) House price appreciation for the 50 states and Washington, D.C.; 2) House price appreciation by Census Division and for the U.S. as a whole; 3) A ranking of 296 MSAs and Metropolitan Divisions by house price appreciation; and 4) A list of one-year and five-year house price appreciation rates for MSAs not ranked.


http://www.fhfa.gov/webfiles/1154/hpimonthly122308.pdf


12. How does the House Price Index differ from the Census Bureau’s Constant Quality House Price Index (CQHPI)?
The HPI published by FHFA covers far more transactions than the Commerce Department survey. The CQHPI covers sales of new homes and homes for sale, based on a sample of about 14,000 transactions annually, gathered through monthly surveys. The quarterly HPI is based on more than 36 million repeat transaction pairs over 34 years. This gives a more accurate reflection of current property values than the Commerce index. The HPI also can be updated efficiently using data collected by Fannie Mae and Freddie Mac in the normal course of their business activity.


13. How does the HPI differ from the S&P/Case-Shiller® Home Price indexes?
Although both indexes employ the same fundamental repeat-valuations approach, there are a number of data and methodology differences. Among the dissimilarities:

a. The S&P/Case-Shiller indexes only use purchase prices in index calibration, while the all-transactions HPI also includes refinance appraisals. FHFA’s purchase only series is restricted to purchase prices, as are the S&P/Case-Shiller indexes.

b. FHFA’s valuation data are derived from conforming, conventional mortgages provided by Fannie Mae and Freddie Mac. The S&P/Case-Shiller indexes use information obtained from county assessor and recorder offices.

c. The S&P/Case-Shiller indexes are value-weighted, meaning that price trends for more expensive homes have greater influence on estimated price changes than other homes. FHFA’s index weights price trends equally for all properties.

d. The geographic coverage of the indexes differs. The S&P/Case-Shiller National Home Price Index, for example, does not have valuation data from 13 states. FHFA’s U.S. index is calculated using data from all states.

POSTER OPINION
aka "our spaghetti on the wall is better than Case/Shiller's noodles and depending on how you wish to manipulate the data - you can pretty much get it to say anything you wish".
__________________
Kill the Contract Review Bull$eye - Now.
  #5  
Old 11-08-2009, 03:13 PM
Metamorphic's Avatar
Metamorphic Metamorphic is offline
 
Join Date: Mar 2008
State: California
Professional Status: Certified Residential Appraiser
Posts: 4,804
Default

"FHA statistics consider the entire market. The characterization of the market provided in my appraisal report is neighborhood specific, and focused on the subject's specific sub-market. In this case while the market as a whole is declining, the subject's sub-market has stable pricing.
  #6  
Old 11-08-2009, 06:20 PM
VolcanoLvr's Avatar
VolcanoLvr VolcanoLvr is offline
 
Join Date: Oct 2003
Location: Inside the ring of fire
State: Washington
Professional Status: Certified Residential Appraiser
Posts: 2,876
Default

I have this info in my Addendum (but it does not guarantee it's read!):

"Regarding Property Value trends, it is important for underwriters to understand that national statistics provided by NAR, OFHEO, and S&P/Case Shiller for Regional MSAs are very broad in nature, and include diverse properties that in many cases are unrelated to the subject's characteristics and/or specific location within the MSA. Use of these broad-based statistics may not be credible for the subject's specific valuation assignment. Major mortgage loan funders recognize that sub-markets exist within the broader MSA, and that an evaluation of the subject's specific features may reveal a trend contrary to, or similar as, the overall MSA information.

The appraiser utilizes extended time research and analysis involving properties directly comparable to the subject to determine the Property Value trend noted on Page 1 of the 1004 Form.

The current residential sales market for properties similar to the subject appears to be (add your own statement) with the current housing demands for the subject's market area."
  #7  
Old 11-08-2009, 10:02 PM
NC Old Guy NC Old Guy is offline
 
Join Date: Jan 2002
State: North Carolina
Professional Status: Certified General Appraiser
Posts: 448
Default

Sorry, I'm just glad to see a lender that actually has the ....s to ask. Too many appraisers just mark "stable" despite all evidence to the contrary because they don't want to create a problem for anyone. I get to mark "stable" about 10% of the time: the rest are decline. I never get a question since all of the data as to how I reached the conclusion are in the report. That doesn't stop us from getting "fired" because "no body else says it is a declining market & since you marked that, our borrower has to come up with an extrat 5%, you stupid @#$%.

In my opinion, anyone marking stable should be forced to prove it.
  #8  
Old 11-08-2009, 10:08 PM
Terrel L. Shields's Avatar
Terrel L. Shields Terrel L. Shields is offline
 
Join Date: May 2002
Location: Springtown, AmeRica
State: Arkansas
Professional Status: Certified General Appraiser
Posts: 40,320
Default

I believe the FHFA relies only on Fannie mae data. In my market, that is less than 20% of the market and is generally in a narrow range of values from $50K - $250K and does not capture the huge distressed prices in the very lowest and highest of our market, nor does it capture the stablest parts of our market, generally in the $75-150K range. Fannie/freddy loaned a lot of crap, but most local lenders refused to write "loc doc, no doc" loans. Only CW and some of the other Bit players of similar ilk were doing those here.
__________________
Sometimes you have to know when to stop beating a dead horse-Baxter Black
.
  #9  
Old 11-09-2009, 08:22 AM
Mike Garrett, RAA's Avatar
Mike Garrett, RAA Mike Garrett, RAA is offline
 
Join Date: Jan 2002
Location: Colorado Springs, CO
State: Colorado
Professional Status: Certified Residential Appraiser
Posts: 20,984
Default

If an appraiser marks declining on a VA appraisal they must support that by gridding at least two listings. What is wrong with that logic?

Some very good stuff in this thread...think I will cut and paste into all my reports.
__________________
A Former AQB Certified USPAP Instructor
  #10  
Old 11-09-2009, 12:00 PM
Mike Boyd Mike Boyd is offline
 
Join Date: Jan 2002
Location: Santa Rosa, CA
State: California
Professional Status: Retired Appraiser
Posts: 11,822
Default

Quote:
Originally Posted by jmarch305 View Post
"Explain why market conditions shows "stable" while, www.fhfa.gov, shows declining trend."

I am just explaining to the UW that the appraiser researched closed sales within the described neighborhood boundaries within the prior 12 months and the general trend is stable as of the effective date. Also, this method is more accurate in determining the trend than a zip code, city or state analysis.

Any thoughts.
It probably takes FHA a year or more before publishing any market research. So, it is stale at the time it becomes available.
Sponsored Links

Closed Thread


Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Forum Jump




Copyright © 2000-, AppraisersForum.com, All Rights Reserved
     Terms of Use  Privacy Policy
AppraisersForum.com is proudly hosted by the folks at AppraiserSites.com

Fastest Way to Find a Real Estate Appraiser Enter Zip Code:
Partner Sites:
AppraiserUSA.com - National Appraiser Directory AllDomainsUSA.com - Domain Name Registration
DeadbeatListings.com - Deadbeat ListingsAppraiserSites.com - Web Hosting for the Professional Real Estate Appraiser
Find FHA Appraisers - FHA Appraiser Search Commercial Appraisers - Commercial Appraiser Search
Relocation Appraisal - Find Relocation Appraisers Domain Reseller - Business Opportunity
Home Security Buzz - Home Security Info Radon Testing - Radon Gas Info
My Medicare Forum - Medicare Info Stop Smoking Help - Help Quitting Smoking
CordlessPhoneStore.com - Great Cordless Phones AndroidTabletCity.com - Android Tablet Computers

Follow AppraisersForum.com:          Find us on Facebook            Follow us on Twitter


All times are GMT -5. The time now is 07:06 AM.

SiteMap: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 64, 65, 66, 67, 68, 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93