Rookie appraiser, Withdrawing from assignment

[The Bob]

Hello. I'm only 5 reports in (rookie).... and I'm withdrawing from an assignment. The SOW is a 2055 for a HML as-is/ARV. Suburban area in LA county.
I get all the data... then analyze. Subject market area is near an active landfill and has about 150 homes within a 0.5 mile area.
I run a 1004mc (even though data is limited) for the immediate market area, then I open up to include nearby similar market areas.
I look at regression charts: 4% decline monthly. Charts are a little messy, with little data.... but I soldier on. HOWEVER.... my most recent comps are from November 2024; and the nearest as-is comp is 2.5 miles away. That was the deal breaker. I withdrew.
I would have had to make 15%+ percent adjustments on all comps, on limited data.
Was I justified in my withdrawal? Yes, I'm sure there are some wizards that could have pulled a rabbit out of a hat (I would love to hear your advice also).

Here was my email to the client BTW:

Determination that a Credible Opinion of Value Cannot Be Made



Insufficient Market Data In accordance with USPAP Standards Rule 1-1, an appraiser must develop an opinion of value that is supported by market data and logical reasoning.

The Scope of Work Rule further requires that the research and analysis be sufficient to produce credible assignment results.

During the course of this appraisal assignment, it was determined that a credible opinion of value could not be developed due to the following factors:

Lack of comparable sales data within a 2 mile radius.

Market conditions with extreme volatility and limited transactions.

Unreliable or Incomplete Property Information

Unavailable site inspection, preventing verification of key attributes.

Given the absence of reliable market indicators, the application of standard valuation approaches (Sales Comparison, Cost, or Income) would not yield supportable results.

Alternative valuation methods would introduce undue speculation, leading to non-credible conclusions.

[hat in hand apologies, etc etc]

I can send a dog with a note to appraise the easy ones. You will learn 10x more taking on these tough assignments. The client WILL find someone to do this report and will likely use them again. You basically just fired yourself.

 

[Zoe]

I am concerned about the parameters you used. Was this an over-improvement?

I don't agree you lost a client. If you did lose a client, go find another one.

Did this client send you a Christmas gift? LOL

Send your contact a Happy Easter email.

I am worrying you included things in your analysis that may not should have been in the analysis with the subject. When you have to start diagnosing between locations where the most competing properties are with your subject, it can be really time consuming.

In Tennessee. 1 mile away, 2 miles away is nothing. 200 miles or more can be nothing depending on the subject.

On the other hand, in Memphis, the other side of street can make a difference on your subject.

 

[Terrel L. Shields]

I can send a dog with a note to appraise the easy ones. You will learn 10x more taking on these tough assignments. The client WILL find someone to do this report and will likely use them again. You basically just fired yourself.

I am not sure. What fires you permanently however is to get a complaint sent to the state and they, in turn, will diss you over your experience level. I might not go into detail why I was withdrawing. Heck. I might even tell a fib and say I have a health issue come up or my 11th granny just died and the funeral is in Terra del Fuego, but I will want to quickly assess my ability to do an assignment if I suspect in the least that it could be problematic. And hand it back quickly.

I have turned down many assignments without hurting my relationship with the lender. In a close-knit town like I live, occasionally they try to hire me to value property that I have a conflict, such as a close friend, relative, or someone that I have not gotten along with. I am grinning thinking on this one after an Ahole business owner complained I under-estimated his property when, in fact, I had actually appraised it for more than he was asking. Seems the borrower lied to him. What the borrower meant, I am sure, was that the bank would not loan but X amount - which happened to be 70% of the sale price...not that the appraisal came in low. (commercial property with weak income history). Now he had his TruckStop for sale and it's been on the market for 2 years. Badly over-priced. So, suffer. Retirement isn't in the future if you don't drop the price, stud boy. His daughter knows the truth but she just rolls her eyes at dear old dad and ignores it.

 

[George Hatch]

Stretching a little is an effective strategy. Stretching too much at one time can be risky. You want to develop a reputation for solving problems, not adding to these problems.

As for the fee, just put that out of your mind. You will always take beating on the fee when you're doing new-to-you. What comes first in that scenario is doing right by the client and users; to solve their problem. I never chase fees. I always chase the client relationship. Repeat business is hard to develop and easy to lose.

 

[Zoe]

Focusing on mileage and net and gross adjustments can get you in trouble. Focus on where you would go to compete with the subject. Same way with gross and net and line item adjustments.

I agree with earlier poster also on "as is" and "as repaired". No way you can do that unless all you see is the roof gone and you know it needs a roof. Then it is time to call the client and say we don't have a roof on the subject?

Here are my pictures?

How would you like me to proceed?

Liquidation assignments can only be completed "as is" for some clients. On most 2055s, all that is needed is "as is" unless you notice something that is obvious.

You can't make things up on "as repaired". You can give disclosures to help the client know what you could observe.

On the landfill, do you have evidence in the market that it has impacted nearby properties to the landfill?

Your client needs to know that.

 

[glenn walker]

I never withdraw ...get sick or I'm sorry but a family emergency came up and so can you please reassign the order. I'm sorry for any Inconvenience . I hope to be back in two weeks.. lmao

 

[ZZGAMAZZ]

Focusing on mileage and net and gross adjustments can get you in trouble. Focus on where you would go to compete with the subject. Same way with gross and net and line item adjustments.

I agree with earlier poster also on "as is" and "as repaired". No way you can do that unless all you see is the roof gone and you know it needs a roof. Then it is time to call the client and say we don't have a roof on the subject?

Here are my pictures?

How would you like me to proceed?

Liquidation assignments can only be completed "as is" for some clients. On most 2055s, all that is needed is "as is" unless you notice something that is obvious.

You can't make things up on "as repaired". You can give disclosures to help the client know what you could observe.

On the landfill, do you have evidence in the market that it has impacted nearby properties to the landfill?

Your client needs to know that.

Properties 2 or 3 miles away from what ostensibly is a typical residential property almost always are appropriate comps, even in a densely populated environment. I think that's why the industry periodically debunks the 6-month, 1-mile thresholds. Just takes longer to explain why one did what one did, and why they didn't do what they didn't do. Very infrequently does a poential buyer need or even want a specific location, like here in the SoCal Inland Empire where buyers are flocking to homes that require a 4-hour daily round-trip commute because they're listed at like less than $600,000. location/location/location.

 

[J Grant]

Properties 2 or 3 miles away from what ostensibly is a typical residential property almost always are appropriate comps, even in a densely populated environment. I think that's why the industry periodically debunks the 6-month, 1-mile thresholds. Just takes longer to explain why one did what one did, and why they didn't do what they didn't do. Very infrequently does a poential buyer need or even want a specific location, like here in the SoCal Inland Empire where buyers are flocking to homes that require a 4-hour daily round-trip commute because they're listed at like less than $600,000. location/location/location.

! mile was never a rule or requirement; it was always a guideline; all you need to do is explain why you went over a mile for comps.

That said, the MV is not just set by buyers, and where they would purchase, it is also set by sellers and the properties they compete against . Which starts with the closest proximity ones. Tht said, close proximity comps are ideal from both buyers would purchase these to seller competing against these, however, very often, there are no good similar home comps within close proximity, and some buyers look for a very specific kind of property which are scarce and thus that buyer is probably open to going a further distance to get that specific property (large acreage, ocean front, whatever )

 

[Mark K]

Determination that a Credible Opinion of Value Cannot Be Made

By you.

Insufficient Market Data In accordance with USPAP Standards Rule 1-1, an appraiser must develop an opinion of value that is supported by market data and logical reasoning.
You won't always have a lot of data, unless you continue to turn down everything but cookie-cutters.

The Scope of Work Rule further requires that the research and analysis be sufficient to produce credible assignment results.
Some extra work...just do it.

During the course of this appraisal assignment, it was determined that a credible opinion of value could not be developed due to the following factors:
Again...by you.

Sure, on an hourly basis, you'll not make much money but you would probably have learned more from this assignment than you would paying for you next CE course. There are ways to become competent, learn them.

As long as they give you enough time for completion, there are VERY FEW assignments that you should turn down, especially this early in your career. That's how you learn and how you get better. If they want it back in 24 or 48 hours, by all means send it back to them using some reason but I wouldn't send the list of excuses you provided.

Do the tough ones, get better. Good luck in your career and I mean that sincerely. Its a tough world out there.

 

[J Grant]

Hello. I'm only 5 reports in (rookie).... and I'm withdrawing from an assignment. The SOW is a 2055 for a HML as-is/ARV. Suburban area in LA county.
I get all the data... then analyze. Subject market area is near an active landfill and has about 150 homes within a 0.5 mile area.
I run a 1004mc (even though data is limited) for the immediate market area, then I open up to include nearby similar market areas.
I look at regression charts: 4% decline monthly. Charts are a little messy, with little data.... but I soldier on. HOWEVER.... my most recent comps are from November 2024; and the nearest as-is comp is 2.5 miles away. That was the deal breaker. I withdrew.
I would have had to make 15%+ percent adjustments on all comps, on limited data.
Was I justified in my withdrawal? Yes, I'm sure there are some wizards that could have pulled a rabbit out of a hat (I would love to hear your advice also).

Here was my email to the client BTW:

Determination that a Credible Opinion of Value Cannot Be Made



Insufficient Market Data In accordance with USPAP Standards Rule 1-1, an appraiser must develop an opinion of value that is supported by market data and logical reasoning.

The Scope of Work Rule further requires that the research and analysis be sufficient to produce credible assignment results.

During the course of this appraisal assignment, it was determined that a credible opinion of value could not be developed due to the following factors:

Lack of comparable sales data within a 2 mile radius.

Market conditions with extreme volatility and limited transactions.

Unreliable or Incomplete Property Information

Unavailable site inspection, preventing verification of key attributes.

Given the absence of reliable market indicators, the application of standard valuation approaches (Sales Comparison, Cost, or Income) would not yield supportable results.

Alternative valuation methods would introduce undue speculation, leading to non-credible conclusions.

[hat in hand apologies, etc etc]

What I find strange from the client is they want it on a 2055 form - am I correct that there would be no interior inspection of an AS repaired value appraisal?. That alone is the reason to turn it down imo.

The lack of close comps in itself is not a great reason to turn an assignment down, though we are independent and can turn down an assignment for any reason. Feeling uncomfortable is a good reason - as you have only done five reports, do you have a mentor, or are you on your own? It's a tough dilemma as to how you get experience without stretching yourself on an assignment. Of course, people here can give advice, but we do not see the property - good luck on your next assignment, and know that even we long-time appraisers are still learning.