Functional Utility

[ZZGAMAZZ]

. . . and apparently inflated the opinion of value by making functional utility adjustments downwards of $10,000--towards the selling price--rather than $15,000 or $30,000 as the market dictates. It is hoped that this rationale isn't explained in the report; if so it might be prudent to ask for an opportunity to revise the report (just based upon my limited experience).

 

[Kevin A. Spellman]

The real functional problem is how strong the fan in the bathroom works and does it make a loud noise when running. If the bed is near the door to the bathroom, then the room is small in respect to furniture placement. These properties work well for a single person and possibly a couple. Remember match pair analysis only works when you select the pair; otherwise the analysis would not be relevant or measured.

 

[PropertyEconomics]

The real functional problem is how strong the fan in the bathroom works and does it make a loud noise when running. If the bed is near the door to the bathroom, then the room is small in respect to furniture placement. These properties work well for a single person and possibly a couple. Remember match pair analysis only works when you select the pair; otherwise the analysis would not be relevant or measured.

The real functional problem is having matched pairs that show $15,000 - $30,000 in difference and using an adjustment of $10,000. That is a HUGE functional problem .. with the appraiser not functioning properly.

Sorry Carol ... but your analysis is probably well done but its application is totally wrong. What did your supervisor say?

 

[Michigan CG]

Most of Southwest Michigan is not a haven for high priced homes, and from what I can infer, this would be an older home, most likely a smaller sized home. So let's say it is 1,000 SF to be generous.

You only have one bathroom accessed through a bedroom and you show matched pairs giving you $15,000 and $30,000 indicated adjustments.

If it is like a typical home in my area, with the above assumptions you have a home with a value of $75,000-$110,000. So you have an adjustment of roughly 15-40% of the total value? Not likely. Are the homes truly matched pairs?

.....where walking through a bedroom to get to a bathroom, laundry room, living room, etc, is more typical than not. The typical buyers in these neighborhoods I describe pay for the # of bedrooms, # of bathrooms, and a kitchen, no matter how they are ordered and accessed. As a result, applying FO is not reflective of the typical buyer and would misrepresent the market value......

IF this house is the type of house I have pictured in my mind, it is a starter home, typical buyers just want to own a home that is close to the same cost as renting an apartment and what Mr. Spealman said above is typical.

 

[PropertyEconomics]

Most of Southwest Michigan is not a haven for high priced homes, and from what I can infer, this would be an older home, most likely a smaller sized home. So let's say it is 1,000 SF to be generous.

You only have one bathroom accessed through a bedroom and you show matched pairs giving you $15,000 and $30,000 indicated adjustments.

If it is like a typical home in my area, with the above assumptions you have a home with a value of $75,000-$110,000. So you have an adjustment of roughly 15-40% of the total value? Not likely. Are the homes truly matched pairs?



IF this house is the type of house I have pictured in my mind, it is a starter home, typical buyers just want to own a home that is close to the same cost as renting an apartment and what Mr. Spealman said above is typical.

Tim .. you either believe the post or you dont. If the appraiser did the matched analysis and thats what it showed .. and another number was used all together .. there is a problem.
Not seeing their work I cant simply say yes or no as you appear willing to do .... its all about application ...

If she wishes to give examples of the pairs analysis we can look at that .. but at some point we must trust what they say ... and then look at application of their findings.

 

[Hamlet]

I would have to agree with Tim that is seems something else is clouding the matched pair analysis. Never the less, a 10K adjustment for a paired analysis that indicates a range of 15-30K is not appropriate. What is a “normal” adjustment anyway?

 

[PropertyEconomics]

I would have to agree with Tim that is seems something else is clouding the matched pair analysis. Never the less, a 10K adjustment for a paired analysis that indicates a range of 15-30K is not appropriate. What is a “normal” adjustment anyway?

More importantly .. WHERE IS THE SUPERVISOR???

 

[Hamlet]

More importantly .. WHERE IS THE SUPERVISOR???

Well, the supervisor must have approved, since it was sent to the lender.

 

[John Hassler]

Hi Carol

In the future, you might also consider researching past sales of the subject if they are available. Calculate how much less it sold compared to its otherwise equal peers at that time. Unless there has been a shift in buyer tastes the layout discount from the past should be applicable to today.

 

[Carol Barber]

ZZGAMAZZ, I felt that it would not have been credible to have gone any lower on the value either. There were several comparables that sold under foreclosure for 45-50K that were in far worse shape than the subject. The subject was updated. That was also indicated on my report. My conclusions on this report were based on as many facts as I could gather, combined with my experience as an investor in this market, and my limited appraisal experience. To suggest that my "OPINION" (which is what we offer, correct?)was swayed in any way is not the case. I had no idea what they were looking for. In looking at it from your point of view, and the limited information I provided here, I can see where you are coming from though, and I appreciate the input.