formula for time adjustments

[cwgiant]

I have misplaced my file that had my formula for time adjustments. Can someone help by providing a formula/method for making time adjustments with the following data:
house A sells on 09/01/06 for $450,000
house B sells on 02/01/07 for $410,000

Thanks for your help!

 

[David Dietz]

450,000 - 410,000 = 40,000/450,000 = .08889/5mo = .01778 > 1.8% per month rounded

This is assuming you are attempting to determine the monthly decline & these sales are comparable. I like to base my decline on a median market trend per quarter rather than isolated sales.

 

[Hal Mann]

Way Insufficient Information.

This is assuming you are attempting to determine the monthly decline.

You're making a whole lot of assumptions here.

 

[Fred]

You're making a whole lot of assumptions here.

Party pooper!

I don't know if it will help, but I can give you the forumula for all adjustments:
DY/DX

 

[Couch Potato]

Making the assumption the properties are identical and representative of the market, the formula B-A equals the adjustment for sales of similar properties from 9/1/2006 to 2/1/2007. For other time adjustments, you need significantly more data covering the entire time period.

 

[Stephen J. Vertin MAI]

Steve

How did you publish the symbol for change in your post? I am impressed.

 

[Lee Lansford]

Two sales don't make a market.

 

[cwgiant]

Thank you David you answered my question. I appreciate your taking the time to help me.

 

[Joyce Potts]

Pair the damn things. All things being equal, then the difference should be the market condition adjustment, theoretically speaking. And I agree that two sales don't 'make' the market, but they certainly shouldn't be overlooked either.

 

[Joyce Potts]

And Furthermore

There is nothing wrong with paired sales analysis IF it's done correctly and documented. Some appraisers are getting nailed for stating they arrived at an adjustment based on paired sale analysis because they failed to have a documented piece of paper in the file with the formula/adjustments/whatever and the investigators are trying to nail them.

Cash or it's equivalency and paired sale analysis is appraising 101 and if you have AMPLE data to make a reasonable case, it's no less of an approach to arrive at an adjustment than regression analysis, IMO.

Just learn to CYA with the workfile.

In my market, for example, if you're not pairing closed sales with nearly identical current listings/pendings that clearly support a downward market condition adjustment IN SOME CASES because of declining value trends, I think that's totally disengenuous, if not misleading.

<waiting on the phone call from Paminator>