1007 question...

[robertwells]

Hi All, I am working on a 1007 and have exhausted all my sources for rent comparables (MLS, prop.mngrs...)...I have one recent rental and all the rest are about 9-12 months old, my subject is not offset or bracketed on the small side in terms of size..I have reached out to the lender saying I have truly inadequate comparable rental data to complete, and I have had a reviewer suggest to just use a listing...

I am seeing if I can learn something here...I typically have at least 3 rented properties on my rent surveys, and sometimes show a listing to supplement earlier data, but I always have at least 3 RENTED comparables. Although the form does not specifically say listings cannot be used, the pre-printed form does have fields for "lease dates"...So my question is, do you folks use listings for some or all of your rental comparables in a 1007? I noted in my case two of the rented comps I have rented at list, and one rented for $200 under...I guess I was always under the impression that one would handle a rent survey similarly to the sales comparison approach, whereby actually rented properties are equivalent to closed sales in the sales comparison approach, and one cannot completed a sales comparison approach with all listings...any way, I'm willing to learn and would appreciate anyone's thoughts/approaches...Thanks, Bob

 

[Terrel L. Shields]

Although the form does not specifically say listings cannot be used, the pre-printed form does have fields for "lease dates"...So my question is, do you folks use listings for some or all of your rental comparables in a 1007?

I don't do the 1007 but I do use listing rental offers. In fact, on a recent commercial property, I got crickets from the Realtors, not one single response. Craiglist wasn't any help. The commercial rents sites claimed they had rent data - ditto LoopNet - but they simply steered me to Tulsa or Oklahoma City miles away. I reached out to the Chamber of Commerce in that town and the guy provided me with a number of current LOCAL commercial rental offerings including one of my comps...I used them all.

 

[robertwells]

I don't do the 1007 but I do use listing rental offers. In fact, on a recent commercial property, I got crickets from the Realtors, not one single response. Craiglist wasn't any help. The commercial rents sites claimed they had rent data - ditto LoopNet - but they simply steered me to Tulsa or Oklahoma City miles away. I reached out to the Chamber of Commerce in that town and the guy provided me with a number of current LOCAL commercial rental offerings including one of my comps...I used them all.

Thanks Terrel, but you had some or most comparables that were actually rented(?)

 

[CANative]

Just do what you can with what you have and explain the issues.

I always check (unless I know) on availability of rent data in my areas before accepting the additional services (1007.) It's difficult in most communities that are not major urban areas because most properties are self managed and no information is available, MLS can and usually is useless, and if you manage to find a local rental management company that will help you out, the 1007 can be more difficult and irritating than the residential appraisal itself.

I've never been questioned on a 1007 in all these years no matter how goofy it was.

 

[Terrel L. Shields]

ome or most comparables that were actually rented(?)

One was a Sears store closed - agent no return call. Her office (ReMax) canned response that someone would call me, crickets. One was a 18,000 SF strip mall - zero info, manger didn't know. Private transaction not on LoopNet nor local MLS...Maybe it was handled out of Tulsa???? 90 miles away. Another 15000 SF strip center same.. No MLS, no local manager, no LoopNet. I had to use a few smaller offerings for rent and a local appraiser (CR) who didn't know the rents either...commercial not their bag. And the Sears store had already closed (auctioned) but didn't find although it had a sign in front. And turned out it was still in the "pendings"...never thunk to look for a closed sale in the pendings until late in the game.

 

[CANative]

Robert, whenever I happen on to an MLS listing with a rental rate, or from a phone interview with a local agent, or a subject property with a tenant, I stash the info in an Excel sheet made for this purpose. It builds up over time and it can make it a lot easier and faster to do 1007's. Include the city in the Excel sheet so you can sort by market when needed.

 

[Tom D]

you use what you have. settled, pending & for rent. did you look at 2-4 family sales, or mixed use properties. however, usually they are 1 or 2 bedrooms mostly. does the local newspaper carry for rents.
how about zillow. they got rentals.
personally, it sounds like you have enough data, but perfection is a difficult master.