Appraisal Bias

[J Grant]

I've never said an appraisal cannot be expressed as a point value - I do it every day. What I HAVE said - and what is in COMPLETE conformity with USPAP - is that one point value within a reconciled range is no more, or less, supportable than any other point within that range.

I don't agree.
I'll give a very simple example. The same subject house, a refinance so no distracting SC price - same subject 2000 sf house in a suburb. Adjusted Value range of the comps is 290k-308k

if the market was declining, wouldnt' an informed buyer pay less, thus it makes sense that the subject might be a point value of 290k or 295k??

And if the market was inclreasing, wouldnt' an ifnormed seller get a higher price, thus subject might be a point value of 305k or 308k?

Above is a very simple and clear reason why one point value is more supportable than the other, - yet you keep insisting that no point value is more or less supportable in a range.

 

[J Grant]

It seems to me that you are the one whose conceptual understanding is limited to form monkey mode on this one. Like I said, just because someone thinks "accurate" asserts an unreasonable expectation doesn't make them a liar every time they sign a report with a single value. If they're meeting the expectations of their users in their work by using the point value then you shouldn't be accusing them of doing wrong.

Form monkey??
Are you kidding me??? what does agreeing with the concept that USPAP says an appraisal can be a point value have to do with being a "form monkey?"

I dont' brag here about my clients but I am about 90% non AMC work and have a very good list of direct lender clients and do complex assignments as well, they don't use me because I am a "form monkey"

You always default to a low bar of meet expectations of users, we are supposed to have professional standards as well per USPAP -

 

[CGinMN]

There's nothing prohibiting anyone from giving a range in a GSE assignment.

I don't agree.
I'll give a very simple example. The same subject house, a refinance so no distracting SC price - same subject 2000 sf house in a suburb. Adjusted Value range of the comps is 290k-308k

if the market was declining, wouldnt' an informed buyer pay less, thus it makes sense that the subject might be a point value of 290k or 295k??

And if the market was inclreasing, wouldnt' an ifnormed seller get a higher price, thus subject might be a point value of 305k or 308k?

Above is a very simple and clear reason why one point value is more supportable than the other, - yet you keep insisting that no point value is more or less supportable in a range.

Lol these are ranges.

 

[George Hatch]

Form monkey??
Are you kidding me??? what does agreeing with the concept that USPAP says an appraisal can be a point value have to do with being a "form monkey?"

I dont' brag here about my clients but I am about 90% non AMC work and have a very good list of direct lender clients and do complex assignments as well, they don't use me because I am a "form monkey"

You always default to a low bar of meet expectations of users, we are supposed to have professional standards as well per USPAP -

USPAP is a minimum standard. And I already stipulated to appraisers meeting the expectations of the GSE type users expecting the one number. What you've been criticizing people for is believing the lenders should *change* their expectations from the point value to the range and/or including both in their reports. That's nowhere near the same universe as saying any of them going rogue in their day jobs or they're undermining the profession.

What are you going to do if you're handed two appraisal reports with slightly different value conclusions? Are you going to say one is accurate and the other is inaccurate? Are you going to say they're both accurate when it's impossible for them to both be accurate? Are you going to say they were both inaccurate because your opinion falls in the middle?

The form does not drive the analysis. We do not work for the form, the form works for us.

 

[J Grant]

There's nothing prohibiting anyone from giving a range in a GSE assignment.

Lol these are ranges.

I gave the example as to why one point value would be better supported from the ranges ( aleberwer keeps saying all point values are as good or bad as anoter in a range)

There already is a range of values in a GSE assignment ( the adjusted value range of the comps)
These folks are advocating that the product stop with a range and not provide a point value. Which would eliminate 99% of the res appraisal demand out there.

 

[J Grant]

USPAP is a minimum standard. And I already stipulated to appraisers meeting the expectations of the GSE type users expecting the one number. What you've been criticizing people for is believing the lenders should *change* their expectations from the point value to the range and/or including both in their reports. That's nowhere near the same universe as saying any of them going rogue in their day jobs or they're undermining the profession.

What are you going to do if you're handed two appraisal reports with slightly different value conclusions? Are you going to say one is accurate and the other is inaccurate? Are you going to say they're both accurate when it's impossible for them to both be accurate? Are you going to say they were both inaccurate because your opinion falls in the middle?

The form does not drive the analysis. We do not work for the form, the form works for us.

You keep making side arguments instead of addressing what these apparisers want
A) they do not believe in a point value and feel the appraser should only provide a range
B) some of them say any point value in the range is not better or worse than the other wrt support

Why are you addressing other things with me instead of the above A and B, which is what they keep saying?

But to answer you, If 2 appraisals had 2 slightly different conlcusions, I have no idea until I review them if either one is supported or not etc. If they are both well supported but have a slight variance so be it. It has nothing to do with the topic , except that if these appraisers had their way there would not be a point value to even be talking about as an example.

They are under a delusion clients would actually pay appraisers to develop a range. These folks have not stopped to figure out that if they the appraiser do not provide a point value, some other person, or computer program will. Such as what happened with the waiver program. Idk, so these appraisers keep blaterwant their ideal of jsut a value range to wipe out the remainder of res appraisal work?

 

[CGinMN]

Imagine if the GSE forms offered both a point and a range. The LTV would default to the point value, or for a slightly higher rate they could lend of the range. Even though they don't currently do this now, there could be utility in having a range that everyone could get on board with.

 

[J Grant]

Imagine if the GSE forms offered both a point and a range. The LTV would default to the point value, or for a slightly higher rate they could lend of the range. Just because they don't currently do this now, there could be utility in having a range that everyone could get on board with.

They arelady do offer a range, the adjusted range of the slaesc comps.

But clearly, any appraiser now, cand do clarify that as a range and then provide the point value.

These appraisers are arguing against providing a point value !!

 

[George Hatch]

"Imagine if the GSE forms offered both a point and a range. The LTV would default to the point value, or for a slightly higher rate they could lend of the range."​

It would also prevent underwriters and reviewers from getting excited about small variances between what the appraiser thinks vs what they think.

One more thing: these two statements convey different meanings to an astute reader:

My opinion of value as a range is between $300k-$305k, my value conclusion is $305k​

vs​

My opinion of value as a range is between $280k-$310k, my value conclusion is $305k​

 

[George Hatch]

They arelady do offer a range, the adjusted range of the slaesc comps.

But clearly, any appraiser now, cand do clarify that as a range and then provide the point value.

These appraisers are arguing against providing a point value !!

I already told you that the comps in the SC aren't the only form of a range that an appraiser can express. MOST of my ranges are different than shown in the SC.