Economic Life

[Fred]

Mr. Santora,

Sigh, more word parsing... Ok, in Oregon,

Oregon, schmoregon. This isn't the Oregon chat room. Fact is, you cited a non-existent rule.

Oregon can make up whatever rules they like. Try not to confuse them USPAP.

 

[JSmith43]

Mr. Santora,

Sigh, more word parsing... Ok, in Oregon, include a cost approach in an appraisal report with the land / site value pulled out of your rump, claiming M&S was used for data when it wasn't, and depreciation pulled out of thin air. Along with a disclaimer the approach was given no weight because the client demanded it so that justified the CA hokus pokus you pulled.

Turn yourself into my State board with a copy of your report. Word parsing or not, expect them to explain what lack of credibility in your approach to value means. You may be right, they may use some word(s) other than "credibility," or variant of the word, regarding it to you. However they opt to explain it, make sure you have your checkbook with you.

Webbed.

The Oregon Board is milquetoast compared to my local city government.
Last year they passed a point of sale inspection ordinance, without escrow provisions. The city engineer proudly testified in an open meeting I attended that 99% of the homes inspected required work orders.

The average age of homes in the area is about 25 years, typical range is 0-50. One percent pass......and 99% of the citizenry are living breathing idiots, based upon what they find to be acceptable living conditions up until the mandated POS city inspection

At least one of these guys is going to lose the next election, if I can help it along. It's enough to make me want to cling to 2nd amendment gun rights and religion.:icon_mrgreen:

 

[Webbed Feet]

Oregon, schmoregon. This isn't the Oregon chat room. Fact is, you cited a non-existent rule.

Oregon can make up whatever rules they like. Try not to confuse them USPAP.

Rule schmooule .. Very cute! Actually, the rules are there. You are parsing on a word so have all the fun you want. My "Fact" remains licensed appraisers cannot state they obtained a land / site value in a certain manner, but they did not do what they stated. They can't claim they used a certain source of data, but they did not use that source. They can't claim they used certain methods for arriving at a depreciation estimate, but they did not use those methods. Then after all of that think a disclaimer the approach involved is a POS, due to improvement age or lack of land sales, is going to purchase them a get out of jail free card, for not having done what they said or not saying what they actually did. They most likely will find out that they are sadly mistaken about that if they later face a board complaint.

Webbed.

 

[JSmith43]

What if they said the CA furnished was perfunctory, the figures were PFA using the appraiser's best judgment and M&S is on the desk, but the cost figures are appraiser musings based upon experience with local costs, contractors and the like.

In short, disregard the CA, it might as well have been a doodle?

 

[Webbed Feet]

What if they said the CA furnished was perfunctory, the figures were PFA using the appraiser's best judgment and M&S is on the desk, but the cost figures are appraiser musings based upon experience with local costs, contractors and the like.

In short, disregard the CA, it might as well have been a doodle?

Mentor,

This topic, and what is really behind it, is really a very old one on the forum at this point. What it really is about is demands from clients for the CA so they can use the results for insurance purposes. When we have from an appraisal stand that the CA is inappropriate, due to subject age and lack of land sales in an area where the only remaining method is extraction from sales with +100 year old improvements for the land value...., it simply means no CA should be attempted or provided at all. Not one provided anyway with a disclaimer the CA is a POS.

Unfortunately for many appraisers facing board complaints, many seem to believe a POS Rule has been created. That as long as they invoke the POS Rule they can suck up to these client demands for an approach that should never have been used in the first place. Unfortunately, just like Mr. Santora claims there is no "Credible Approach Rule," there is no "POS Rule" either. The only real rule is if we do the approach, we better do the work. Dont do the work, but report an approach that wasn't done the way it was reported to have been done, then we had better expect to get whacked for not doing what we said we did. A disclaimer isn't going to get us out of getting whacked if we don't do the work we said we did.

Webbed.

 

[JSmith43]

"A disclaimer isn't going to get us out of getting whacked if we don't do the work we said we did."

I wasn't offering a disclaimer, merely a reduced SOW; one that relegated the CA to the status of an inflamed appendix or tonsils. Yes, I agree that people should accurately describe their abbreviated methods.

What about all those useless comp 4 requests that roll down from UW's in high places? Appraisers commonly add them to placate UW's that are paranoid about a review or audit, based upon their recollection of the dumbest review or audit that they have ever experienced?

Are Oregon Board actions going to serve as the litmus test for the rest of us?

 

[dane84094]

The little old lady has kept the house up well, but Mickey-D is willing to pay twice what an otherwise similar SFD is selling for around the corner.

That would be 0 years REL, and it happens all the time. This is why FNMA is as concerned with REL as they are physical condition. They do not want to make a residential loan on a property that does not have the likelihood of remaining an SFD for a long time.[/quote]

When you say that Mickey-D's is willing to pay twice the price. What the heck? The mortgage will be paid in full as soon as escrow closes.

There has to be a better example.

This is also confusing to me.

 

[Mark to market]

Who made M&S the all knowing, all saying Bible of reproduction/replacement values and/or economic life. I don't find them all that reliable, to be perfectly honest.

I'd rather trust my local builder providers, builders and Home Depot, to be honest.

But I guess it's cheap, industry accepted and easy, so there you have it. Who needs accuracy?

I find M&S to be uncannily accurate. Does everyone in Florida have issues with it?

Maybe the wild swings in your market are skewing the EI %, external obsolescence and other things.

 

[jay trotta]

Nope, here in CT I don't use it either anymore. Did for a while, now I don't, I use various sources and then check periodically with local builders. M & S here is used by most town assessor's; site value's are arrived at via a universe of product, then some of the happy assessor's have developed their Own methodology as to adjustments for site improvements, it is truly a moment, in front of other attorneys or Judges or multi-millionaires.

Just recently purchased one of my long time favorites and will be reviewing it and getting to know the in's & outs of the prep documents that go along with it. There are also some factors to consider, but for the most part, it's something I've been wanting to entertain for some time and am pretty much board with everything else.

I believe Joyce raised an issue several pages back; if anyone demands you to use a specific age/term - 30 yrs. was the factor; we have completed a misleading report per USPAP and for the most part, everyone in the Appraisal business has completed misleading and unsupportive reports, so no one here is Special. The sole purpose of USPAP is to capture the essence of appraising, the writers have written it with their understanding being implemented. Understanding what they meant at the time each sentence was written has evolved into the ever changing - Q &A. Additionally, each State can implement it's own understanding of USPAP and therefore, none of you will ever get it right....R O F L

As it has been stated many times here, Our work is a work of Art, math is also used in art, as in ; when you follow the numbered dots to create a picture. Think I'm wrong, check your guidelines, they are all directional and ifn you follow the dots, you have a portion of the Art you are about to create, the "special" part is Your ability to understand Your area of the market and paint the "Picture" in a form understandable to the reader. Most UW's review "Velvet Art" on the weekends, thus the "Stupid Stips" - they just fergit they're not at the Flee Market any longer.........LOL

 

[Joyce Potts]

Nope, here in CT I don't use it either anymore. Did for a while, now I don't, I use various sources and then check periodically with local builders. M & S here is used by most town assessor's; site value's are arrived at via a universe of product, then some of the happy assessor's have developed their Own methodology as to adjustments for site improvements, it is truly a moment, in front of other attorneys or Judges or multi-millionaires.

Just recently purchased one of my long time favorites and will be reviewing it and getting to know the in's & outs of the prep documents that go along with it. There are also some factors to consider, but for the most part, it's something I've been wanting to entertain for some time and am pretty much board with everything else.

I believe Joyce raised an issue several pages back; if anyone demands you to use a specific age/term - 30 yrs. was the factor; we have completed a misleading report per USPAP and for the most part, everyone in the Appraisal business has completed misleading and unsupportive reports, so no one here is Special. The sole purpose of USPAP is to capture the essence of appraising, the writers have written it with their understanding being implemented. Understanding what they meant at the time each sentence was written has evolved into the ever changing - Q &A. Additionally, each State can implement it's own understanding of USPAP and therefore, none of you will ever get it right....R O F L

As it has been stated many times here, Our work is a work of Art, math is also used in art, as in ; when you follow the numbered dots to create a picture. Think I'm wrong, check your guidelines, they are all directional and ifn you follow the dots, you have a portion of the Art you are about to create, the "special" part is Your ability to understand Your area of the market and paint the "Picture" in a form understandable to the reader. Most UW's review "Velvet Art" on the weekends, thus the "Stupid Stips" - they just fergit they're not at the Flee Market any longer.........LOL

Grats--you get it, IMO.