Condo Cost approach

[Fred]

P.S.. Gentleman. We CANNOT use disclaimers like you are proposing when the client is specifically asking for a SOW for INSURABLE VALUE... [/QUOTE] That hits the nail on the head. An appraiser cannot un-know what he or she already knows. An appraiser cannot un-agree to assignment conditions already agreed to. If the client says give me a cost approach for my intended use of insurable value, you can’t say here is the cost approach but you can’t use it for you intended use. No one is going to fall for that.

Here is the verbage that LIA asked that my Mentor add to all reports:

Yes, but that was for when the insurance is not the intended use. The LIA also included instructions for what the appraiser ought to do when insurance is the intended use. So, in effect, you snipped the wrong part of the instructions.

 

[Webbed Feet]

Mr. Santora,

We've actually been agreeing on stuff lately. Scary huh?

Webbed.

 

[Fred]

Mr. Santora,

We've actually been agreeing on stuff lately. Scary huh?

Webbed.

I think our disagreements revolve around only three core issues. BTW, in response to the ASB's recent request for us to highlight the parts of USPAP that are confusing, I sent them about two pages explaining why SMT-3 needs to be retired. If they take my advice, that will leave only two core issues.

 

[Webbed Feet]

<snip> ..... I sent them about two pages explaining why SMT-3 needs to be retired. If they take my advice, that will leave only two core issues.

Cool! I sent em four pages explaining why SMT-3 is needed.

:new_multi:

Webbed.

 

[Fred]

Cool! I sent em four pages explaining why SMT-3 is needed.

:new_multi:

Webbed.

Post them.

 

[Webbed Feet]

Post them.

You spoke up first. You post yours.

Webbed.

 

[Fred]

You spoke up first. You post yours.

Webbed.

I don't think you have one. Mine was reviewed by George Hatch before I sent it.

 

[Fred]

Mr. Foot,
Since it seems the original theme of the thread is exhausted, I suppose I can leave this here for your perusal without besmirching the integrity of the forum too much. You have seen most of the ideas already. This is not the best I can do, but on short notice, it's a pretty good summary.

 

[Webbed Feet]

I don't think you have one. Mine was reviewed by George Hatch before I sent it.

LOL! And mine was on pretty paper and I used colored pencils. So what the heck does that matter? Or who reviewed yours? You brought this all up, I didn't. I only noted we agreed on something for a change.

However, I will say I do see a disturbing trend in those wanting to "retire" more and more sections of USPAP. Versus work at clarifying them. Perhaps we should just combine this into a total of six pages explaining why to retire all of USPAP completely. Then we can work on retiring the entire trade too, since once the AMCs are done with us, all that will be left will be morons working in it.

Webbed.

 

[Fred]

LOL! And mine was on pretty paper and I used colored pencils. So what the heck does that matter?

In the grand scheme, it doesn't matter. I was just testing the honesty of your comment that you produced four pages.

However, I will say I do see a disturbing trend in those wanting to "retire" more and more sections of USPAP.

There is quite a bit that needs to be retired, because what is there is disturbing on its face.

USPAP is suppoed to be a "common basis of all practice." In that context, everything that used to be a "specific" guideline or requirement doesn't fit, because they go to "specific" situations. That's like all of 1-3 and 1-4.

It might not be so bad to leave all that stuff that is not common to all practice in there, but so much of that material is laden with errors, which coincidentally gets us back on track with this thread. If one is doing insurable value, then the cost approach is likely necessary. SR 1-4 says when the cost approach is necessary, one must develop a land value and do something with accrued deprecation in sections b(i) and b(iii). However, for insurable value, the land value and accrued depreciation are irrelevant. The error is that the SR assumes appraisal are for market value, which is inconsistent with the goal of having standards that are the common basis of all practice.

FWIW, I don't see any clear way to fix those errors. Do you?

Gee, does this mean you don't me like again?