Factors That Impact Complexity In A Real Estate Appraisal Assignment

[Eli]

Please provide different factors that impact the "complexity" of an appraisal assignment. I know it's a hard question, but very important to consider.

 

[J Grant]

A subject that is atypical of market, and /or one with few available sales /scarce data or a property influenced by complex factors such as zoning or location or extensive repairs etc that needs special attention.Sometimes all of these are present in one assignment .

 

[Randolph Kinney]

In short, Scarcity. That means location as well as use or uniqueness or marketability.

 

[RSW]

Unpermitted additions and remodeling are a problem in East Tennessee.

 

[3 Putt]

While there is no precise definition of a "complex" residential appraisal, the federal financial regulatory agencies presume that an appraisal of a one-to-four family residential property is not complex unless the property itself, the form of ownership in which it is held, or market conditions are atypical.

"Atypical" means that specific characteristics of the property being appraised differ from what is the norm in the neighborhood or market area in which the property is located. Although this list is not exhaustive, examples of what federal financial institutions consider atypical factors that may make an appraisal "complex" include:

* the architectural style, the age, or the size of the improvements;

* the size of the lot;

* the use of the property when contrasted with other land uses in the neighborhood;

* the presence of potential environmental hazard liability; and

* the existence of leasehold interests.

An appraisal assignment in one locale may involve "atypical" factors and thus be "complex" (for example, a condominium unit in a rural area). In another locale (an urban area) that same property may not involve "atypical" factors and thus is "non-complex."

 

[Person of Noninterest]

I will request a complex property fee if any of the following are present:

* Gross living area over 3,000 sq.ft. per county records
* Waterfront
* Site area over 5 acres
* Rural AND remote

These are the most frequently occurring factors in my market which lead to appraisal complexity.

 

[The Bob]

Lack of recent, proximate, and comparable data.

A lot of assignments involve answering a question over and above the obvious "what's it worth?". And it almost always involves a unique quality or feature that most of the comparables lack. Maybe it's a pool; a detached accessory unit; adverse site influence like a busy road/powerline, or even condition.

 

[Meandering]

When all the comps have seller's assist, or when there are no comps that weren't REO or shorts within the neighborhood.
When there is 5 acres or larger land size
Lakefront - River Front. Dang rivers make you go further up or down stream for comps
When there is more than one house on a lot
Certain neighborhoods.
Any home smaller than 800 sf
Any home larger than 3,400 sf
Any home with an in ground pool
Any home with livestock in the yard

 

[DWiley]

In short, Scarcity.

This hits it right on the head. It is all about the data. Got a dome home with a finished basement on a lake lot? Not a problem if I have 10 sales of domes homes with basemenst on lake lots. Got a new 1,500 SF 6-3-2 ranch? Complex if it sits in the middle of 100 year old colonials. It is all about the data.

 

[Terrel L. Shields]

No one can define that line however.

So a lot without mineral rights is "complex"? Or not? A timber tract? As for a 3,000 SF home, we have a lot of them in certain areas...easy to "comp", but how about one that is 600 SF?