Ranking Analysis for Retrospective Appraisal

[Carnivore]

I also meant possibly Relative Comparison Analysis

OK, no matter how hard I try, I can not determine individual adjustments for this appraisal. The report is retrospective all the way back to 1/6/2006.

I also completed a review of the orignal report made on this subject effective date: 1/6/2006. I was not able to determine adjustments with it either. To give you the best example of what the other appraiser did: He made a $1,000 dollar adjustment for the difference between 2.5 baths and 3.5 baths. He did this to favor the sell price of the subject.

The comps in this neighborhood(lake front/lake access) are all over the place because most of them are new builds or the re-sales whith ages from one to four years.

I think my only choice is to do a relative comparison analysis. I place them in order of lessor to greater.

I want to do this because I can not just make up adjustments or SWAG or even a professional guess. This has a strong probability of going to court.
My Client is not a lender, but a lender along with others will be defendents. I am not at liberty to say anymore.

I need some advice and opinions, no matter how rough, bring it on.

To refresh some of your memories:

relative comparison analysis
A qualitative technique for analyzing comparable sales; used to determine whether the characteristics of a comparable property are inferior, superior, or equal to those of the subject property. Relative comparison analysis is similar to paired data analysis, but quantitative adjustments are not derived.

ranking analysis
A qualitative technique for analyzing comparable sales; a variant of relative comparison analysis in which comparable sales are ranked in descending or ascending order of desirability and each is analyzed to determine its position relative to the subject.

See attached grid of the three most similar sales.

 

[hastalavista]

I'm a fan of ranking, as I think it can reasonably simulate how the market actually works.

My only advice is to spend some time in your appraisal going through your attempts to complete a typical SCA with adjustments-
I first considered.....
When I attempted to extract from the market.....
Matched paired analysis provided conflicting and contrary adjustment indicators....
At the end of the day, I've concluded that a ranking analysis is the best technique for this assignment....

What's the significant difference between ranking and a typical grid-SCA?
In the typical SCA, the adjustments are explicit.
In ranking, they are implicit.

When adjustments cannot be extracted so that they can be explicitly applied, implicit adjusting (via ranking) makes good sense to me!

Good luck, A!

 

[hastalavista]

BTW, just looking at these three sales, there appears to be a linear relationship between size and price.

 

[Smokey Bear]

BTW, just looking at these three sales, there appears to be a linear relationship between size and price.

Denis, you're such a geek!

 

[hastalavista]

Denis, you're such a geek!

:Emoticon_hug:

 

[Mztk1]

There is also a linear relationship between age of comparables and one between date of sale as well.

Personally, I am not so sure you bracketed your subject's appeal. With its golf course and pool, though 4 years older and a little smaller, comp #1 does not jump out as inferior to the subject; and the other two are definately superior.

Even if you consider the golf course to be a wash due to the loss in acreage, it is debatable whether comp #1 is inferior to the subject. It all depends on the real value of a pool vs date of construction.

I'd look for a house I know for certain, and any reader knew right away, was inferior. The logic puzzle of appraising cannot be completed unless you have at least one inferior and one superior sale.

 

[Carnivore]

Denis,

Thanks for the thoughts, I am using this same technique in the review. Basically I am taking his comps removing adjustments and then making the relative comparison. That alone proved he was wrong.

FTR, the original appraiser valued the subject at over $739,000 , the sale price of superior comparable number three is $719,800. Comparable number three is by the same builder and similara in quality and upgrades!


Ken,

I caught that also about questionable inferiority. Problem was the next step down in comps were just to inferior in many other ways.

What I am not sure of is just how comp one is on the golf course. I could not see the course from the road. To much brush and trees. I am going to GOOGLE Earth it to see what the truth is. I suspect its was nothing more then RE Agent Puffing.

I have attached the comps and the subject photos.

 

[Randolph Kinney]

Just by inspection, the grid looks to be laid out by ranking and it appears the subject's value, without any adjustments, lies between comp 1 and 2.

I would guess more like comp 1 and therefore the value is best represented by comp 1 without adjustments.

 

[Mztk1]

Those photos make for an even dimmer view. The subject elevation is nice, but it doesn't have the pitch and the roof lines of any of the comps, it looks inferior in elevation quality from all of them.

Comp #1, for instance, has 4 peaks and 2 sheds while the subject has 3 sheds over the dormers only and a flat front, straight run foundation. Also, comp #1 has the brick accents and the front pillars plus the circular window. It just looks better from the outside.

Comp #2 has no less than 4 peaks, hip roofs, triple and double windows, and comp #3 is simply impressive relative to the subject.

To me, comps #2 and #3 - on a very superficial level - don't belong in the same appraisal, and comp #1, if used would show the very upper level of market value for the house. But I don't know your location or the interior of the houses. For all I know comps #2 and #3 are nearly shells with vinyl flooring.

Maybe the houses that sold much lower are more competitive. I am waiting on my wife's opinion. She is uncanny at getting exterior elevations and desirability down at first glance. I'll edit this post with her input as soon as she gets a break playing "Puzzle Pirates".

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Okay she says the subject is nice but not nearly as nice as the comps. She says the picket fence porch thing makes it look unfinished, there isn't an entry alcove so it makes it less appealing and the lack of trees makes it look like it sits much closer to the road than the comps and that it just bakes in the sun. She says comp #1 and #3 have the nicest exteriors and comp #2 is superior to the subject as well.

 

[Carnivore]

Jim,

Yes, I really understand what your saying. Problem I have, almost all the comps available are 3500+ sft GLA, 4 bedroom, 3.5 baths, 3 stall gar, even these are not many, then it jumps to 3800+ and I have all the sales in the world to pick from. In other words they are all superior.

Here are some interiors of the subject. I also have another sale I can use, it may just be the ticket to fine tune this report. I work it up and post it here to see what you think,

I think your right on the money with the design and appeal issue.