The outside Condo Comp

[fractal7221]

Different lenders have different policies, I just know its not something I look for on the appraisals we receive unless there is some evidence that the project is in a controlled market. Same as how I do not look for a comp from a competing subdivision on a SFR, except for in the cases of builder controlled PUDs.

 

[DTB]

Which brings us to another issue that might concern a client...if the only place comparable sales to our subject exists is within the building itself, what does that indicate? Are the subject building unit floorplans, size, etc, so unique to subject buiding that no outside buildings in area offer similar condo units? That is something that might concern a lender regarding a limited market and marketability, for example.

While I agree this may be a concern sometimes, if the appraiser states there are 8-10 sales of similar units within the past 6 months I think that should eliminate that concern.

The concern of marketability and limited market occur when you DO NOT have comparable sales within the subject's development. Then, as a lender, I'd be concerned.

 

[fractal7221]

The concern of marketability and limited market occur when you DO NOT have comparable sales within the subject's development. Then, as a lender, I'd be concerned.

Depending on the development's size I'd agree. However, small developments in the 8-16 unit range are not uncommon in some of the markets we serve. In those cases it can be pure luck if there is even one recently closed sale to use.

 

[J Grant]

Interesting discussion and points of view! ):