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  #1  
Old 11-24-2003, 09:28 PM
jan cajar jan cajar is offline
 
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I just recently turned down an assignment because I didn't feel I was the best candidate for it (believe me, it was a complete bruise to my ego and my breath was shuddering as I told the client this!) Their estimated value was about $1M (yes, yes I know, don't even say it...) and it sold about 3 years ago at about the mid $700s. My research indicated there are very few quads such as this that have sold in the last 3 years. In fact, the subject WAS the highest sale in the last 3 years. This quad is right in the middle of an area equivalent to Atlanta's Midtown.. which was probably well worth the $1M. However, I only had triplex sales going back 3 years that were in the mid-$500s. I stated my incompetency on the basis that I know this location is not known for depreciation yet could not back it up with comps; I have only lived/appraised in this city for 6 months; and I've only completed 1 MF appraisal in this city.

My question? I know the client reassigned this report, so SOMEBODY is producing an appraisal on it. (The client told me that an appraisal was completed on it but could not accept it because he wasn't on their approved list). What does an appraiser do when there aren't strong, accurate, similar comparables to use (within in my resources)? I even asked another experienced CR appraiser who's been appraising in this city for 9 years, he actually suggested to turn it down and told them to possibly hire a commercial appraiser to do it. Perhaps this property was not at it's highest and best use? If this property was SFR, I would have had comps to use all day. I am aware I am possibly in violation of USPAP to turn down this assignment based upon research without inspecting the property (basically the end result was a "comp check"). However, it did not "ethically" feel right to me to take their $500 knowing I would have produced an appraisal they could not use, most importantly, an appraisal that probably was not 100% accurate. Please note, I was not in fear of not getting paid on this order, this client DOES pay regardless of the end result.

I just need some peace of mind knowing I did the right thing.
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  #2  
Old 11-24-2003, 10:06 PM
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Jerry Still Jerry Still is offline
 
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Jan,

You did good. Say one "our father" and two "hail mary's" and leave a case of beer at the rear door of the rectory on friday night about 9 o'clock. you will be forgiven.

Father B) Jerry
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  #3  
Old 11-24-2003, 10:26 PM
Oregon Doug Oregon Doug is offline
 
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Ya done good, kid!

Oregon Doug
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  #4  
Old 11-24-2003, 10:46 PM
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CANative CANative is online now
 
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Nothing wrong with turning down an assignment. We turn down many. But, maybe you could have fee split with another, more experienced appraiser, made your client happy and would have gained some addtional experience. Just a suggestion. Someone told me you don't have to be competent to accept an assignment, you just have to be competent by the end of it.

I've been turning down commercial work because I'm not ready for it. But have recently made friends with a local AG. I'm thinking of asking him if I can assist him and start learning this aspect of the profession.
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  #5  
Old 11-25-2003, 01:04 AM
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George Hatch George Hatch is offline
 
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In your situation I would have done exactly the same thing. Theres nothing wrong with turning down a deal that you're not set up for, especially when the data is tough. Not only that, but you ended up saving yourself, and by extension your client, a whole lot of hassle. Don't dwell on it. If you're going to work on new property types, the really tough situations where the data is weak is not the place or the time to start.

'Ya gotta know when to say when.
  #6  
Old 11-25-2003, 03:39 AM
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Richard Carlsen Richard Carlsen is offline
 
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Location: Tip of the Mitt: Northern Michigan
State: Michigan
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It doesn't sound like you turned this one down for lack of competency. It appears you turned it down for lack of market data. Two entirely different things. Both are good reasons for turning down an assignment. Neither is a violation of USPAP. Remember that there is nothing in USPAP that can require you to do an appraisal.

I suspect you did relish the assignment because it was going to be very difficult; push you toward your limits. I also suspect that your fee was not enough for this difficult assignment. Try raising your fee until you cannot wait to tackle a job. Most likely with a sufficiently high fee to compensate you properly, you would have had a whole new attitude on this 4-plex and your ability to do the job.

But in your situation as it was, you did the right thing: When in doubt, don't!
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  #7  
Old 11-25-2003, 05:52 AM
Austin Austin is offline
 
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Location: Blairs, Virginia
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There are a few little quirks about this subject. First: I do a lot of commercial work locally and have been in the business over 30 years and probably have more collective experience in this market than any other appraiser. A lot of the assignments are special purpose properties and properties with no sale or rental data etc., but you have to know enough theory to reach a logical well reasoned conclusion. I read a lot of reports that other local appraisers have done on similar properties so I know what others are doing. Second: There is a little problem with this situation that bothers me greatly and it is this: If a new unknown appraiser with a less than impressive resume took on this type assignment and some reviewer read his or her report and didnít like the way they did it the appraiser could be turned to the state board and the board might take a serious look at it for the same reason; who the hell is this guy. On the other hand, if an appraiser with a long resume that is a member of an AI chapter and is fairly well known around the state by all of the AI people that infest the state boards turned in the same appraisal report it would be looked at in a different light. It is a sorry state of affairs but that is the way it is. I did a special purpose property yesterday and the lender gave me a copy of an appraisal done on a similar property by another appraiser and I read it. He had a designation and knew how to CYA but he was weak on analysis but then again, I had better data than he did. My thinking was, well he must know what he is doing even though I donít agree with his method of doing it, but if he had not been designated I couldnít help but have a different view-Does he know or his he bluffing. It is just human nature. I turn down lots of assignments for one client that I would take for another client because I donít know them and they donít know me. If you have a good resume and belong to the right club you are probably safe but if you donít you can get into big trouble. If you donít believe me, ask Tom Hilderbrandt. I would never do another appraisal in NC because they don't like outsiders and you give them a sword they will use it at the first opportunity.
  #8  
Old 11-25-2003, 07:31 AM
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Bill_FL Bill_FL is offline
 
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I agree with Richard on this one. It was not a lack of competency on this one. It was a lack of data.

What I might not agree with is not performing an appraisal assignment because the client wont like the number you arrive at. I try to consider a few things. My client has hired my to protect their backsides. The LO on the other hand just wants his commision. The LO works for my client. I dont work for the LO.

If there is truely a lack of data, than I could understand why you would turn it down. Personally, I think I would up the fee and turn around time and do more digging.
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  #9  
Old 11-25-2003, 07:57 AM
Thomas Fiehler Thomas Fiehler is offline
 
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Jan-I agree that you did the correct thing. A couple of additional points though. You mentioned that someone said to hire a commercial appraiser-WHY? Was it a commercial use property? And Austin-it seems that you have a case of the goo for someone with a designation. Just my 2 bits worth. B)
  #10  
Old 11-25-2003, 08:27 AM
Austin Austin is offline
 
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Location: Blairs, Virginia
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Thomas:
Ask Bob Ipock of NC about the disposition of cases in NC wherein charges have been brought against AI members as opposed to non AI members. Also, ask him or any other NC appraiser that has followed NCAB activities what happens to non AI members that make AI members look bad. You will be shocked I can assure you.
As a matter of fact, I probably have less goo about designations than another appraiser in the country. Ask Steven Santora why that is.
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