Hi, I need a little help. When writing a comment for adjustments like, bath, garage, central air..., how should the comment read? I am having trouble writing a narrative explanation versus noting what was adjusted for and amount. I need help on this as I am not an English major
. What should the narrative look like. I am wanting to be a better report writer. Thank you.
This is an example of how I do the sales comments. Some properties that are simpler have fewer comments, the more complex properties may take considerably more narrative.
Comments on the Sales Comparison Approach:
The Anderson Valley is a very large, but sparsely populated region. Very few sales of any kind in any given year. Property values in the Anderson Valley have remained more or less stable during the previous 18 to 24 months. Extremely few sales in the last year or two in Boonville and the comparable sales presented in this report are the most reasonably similar, proximate and recent available (see attached list of all transactions and listings in Boonville.)
The subject’s combination of characteristics such as type of construction, condition, lot size and amenities were very difficult to bracket with the available sales and large and/or numerous adjustments were unavoidable. This is not uncommon for this area.
Adjustments:
Market change ("time") adjustments - Some of the sales (comp 2 for example) are somewhat dated but there is no evidence that a market change adjustment is warranted or could be supported. See attached market analysis comments.
GLA adjustment developed using trend analysis and then refined using sensitivity analysis. This analysis indicates that an adjustment of about $125 per square foot is reasonable and supported. Data is inadequate to make adjustments when GLA varies by less than about 150 square feet. I did not round the adjustments which were calculated using the "auto adjustment" function of my software.
Based on analysis of land and lot sales in the area, I have made varying adjustments for lot size differences. Larger lots, say 20 acres, contain surplus land and I have made downward adjustments at $10,000/acre. The smaller 1-acre lot sizes were adjusted upward at $25,000/acre ± for the subject's larger lot size which contains some excess land and which could be subdivided.
Property condition adjustments are based on estimate of cost plus a factor for entrepreneurial incentive. These adjustments were somewhat subjective due to quality and quantity of the data. I was able to interview two agents for two different properties. This market is not sensitive to chronological age of residential improvements.
Some differences, such as half baths, garages versus shops, fireplaces, etc. are not significant elements of comparison and adjustments were not made.
All sales used were listed on BAREIS with various lengths of marketing time. There are no indications that they are anything other than arms-length transactions with appropriate exposure time and I assume this is the case. See attached MLS Photo addendum.
Comp 1: 18680 Lambert Lane - This sale is relevant because it is recent and located in very close proximity to the subject on Lambert Lane (located on Lambert Lane proper rather than the shared access road the subject is located on.) 20 acre± tract of land improved with an older single family residence and a barn. The property initially had an older mobile home on the property (as described in MLS) but the listing/selling agent (Jimmy Humble of North Country Realty) stated that the property could not be financed with the mobile home and it was demolished and removed during the escrow process.) There are no records as to the GLA of this property and the agent estimated it at about 1,000 square feet. The agent also stated that the attic or loft area had been finished with two additional bedrooms (for a total of 4 beds). Very large adjustments required for lot size difference and GLA. The agent stated that the interior was in average condition but there were no MLS interior photos and I could not determine if an adjustment was necessary. Original list price was $699,000 and the final sale price was $623,000. 130 days on market (agent stated the mobile home issue was the reason for the extended marketing period.)
Comp 2: 13360 Estate Dr. - Somewhat dated sale but included due to lack of sales in this market. Located in the Estates subdivision near the downtown area. This neighborhood is located adjacent to the community airfield and some properties include airplane hangers and front the airfields runway. This property is located on a street behind those that front the airfield. Properties in the development typically sell for less than other locations but pricing is inconsistent and an adjustment could not be supported. 1.1 acre site which required an adjustment as noted above. Smaller 2 bedroom, 2 bath residence with a 2 car garage and two small outbuildings. Original list price and final sale price was $429,000. 27 days on market.
Comp 3: 12951 Anderson Valley Way - Relatively recent sale just north of the central business district. 1-acre lot improved with a single family residence more similar in size to the subject (size estimated by listing/selling agent Jimmy Humble of North Country). The smaller lot required an upward adjustment as noted above. The residence is well updated and in good (C3) condition and this required a downward adjustment as noted above. Property also features a 2 bedroom second dwelling unit in good condition. Original list price was $649,000, sold at $605,000 with 53 days on market.
Comp 4: 13240 Orbaun Rd. - This is the only listing found with any reasonable similarity. Located on Ornbaun Road which is south of the downtown area and overlooks the airfield and valley. Older, rustic single family residence and 1.6 acre lot. Smaller two bedroom, 1 bath home. GLA listed at 1,440 square feet. Listing agent (Anne Fashauer of North County Boonville) states that the original garage was converted to living area which is included in the 1,440 square feet noted. View could be improved if the trees on the lot were cut or trimmed. List price is $425,000 and the property has been on the market for 57 days.
