As Of Effective Date: Meaning

[Meandering]

Never better said.

 

[J Grant]

Sorry Res Guy but it is not the same thing shortened. In fact this brings forth one of the reasons I started this thread; the tendency to suddenly jump to the price in the definition of market value as if it is the assignment.

The definition of market value HAS to be linked to development, they are related and not the same. That is why the scope of work that explains how we arrive at the value opinion (A) has the verbiage (as defined) and then B( the market value definition. In other words, the probable price comes from OUR OWN APPRAISAL DEVELOPMENT.

We consider pending sales and listings as part of our development, but our hypothetical presumed sale of subject value opinion as of the effective date belongs to our appraisal development, we can't segment it off into answering only the probable price of the MV definition.

 

[Ken B]

You've been a bad boy and must pick one of the following as punishment:



or engaging JG in discussion.

Well, what will it be?

Wait a minute, will ya!? I'm thinking!

 

[J Grant]

Should I be flattered or offended? Or laugh? Or all three at once lol

 

[Howard Klahr]

Buyers expect the construction to last X years, for income to flow for X years, for location to provide services and amenities for X years etc.

We are in total agreement here. This is the concept of present value of future benefits. It does not however state implicitly or explicitly that the opinion of market value as of an effective date remains for "x" years.

 

[J Grant]

We are in total agreement here. This is the concept of present value of future benefits. It does not however state implicitly or explicitly that the opinion of market value as of an effective date remains for "x" years.

We are in agreement on that as well. I never stated, nor tried to imply that the opinion of market value would remain X for years. That would be an amazing feat! I did state appraisers come to an opinion of market value by considering enduring elements intrinsic to properties, (construction, location, quality etc) . That was the thought behind it.

 

[TRESinc]

I will change "behind the market" to Behind the future direction of the market, since RE agents believe an opinion of market value is supposed to match a sale price which is ahead of what any other closed sale of a similar property sold for, including one that closed last week.

isn't everything (other than a retro) behind the future direction of the market since the future has not happened yet?

 

[J Grant]

isn't everything (other than a retro) behind the future direction of the market since the future has not happened yet?

Yes, I would have to agree . Nothing wrong with that, except for the upset RE agent who cant understand why we can't match the Sale price 10% ahead of any other credible activity we found.

 

[Terrel L. Shields]

In short, our valuation is worthless save for 24 hours. So what is the point? If we are asked to do a retrospective valuation in NYC... say Sept. 10, 2001, now what do we do? Pretend we don't know what happened the following day? KNOWING the coming delay and turmoil in the market? How much property changed hands in NYC after 9 am?

We are the blind leading the blind over a cliff. MV is not "real" in any sense. It is a guess... educated or otherwise. And serves a technical purpose for "valuation" and very little else.

 

[J Grant]

Terrel, surely you realize the market value opinion of an appraisal is a model of value developed to serve a specific purpose. You seem aghast at this; as if an appraisal is supposed to provide an unending series of future values good for all the remaining future years of physical life of a property?

What would the fee be on that...