A MultiFamily Question on Adjustments

[CANative]

Just take your one overall market rent based adjustment and assign each individual adjustment a percentage of the one big adjustment based on your estimate of the value contribution of each of the individual components. ie... since the client is insisting on the individual adjustments that you are not comfortable with due to lack of data for the individual adjustments, just back into them using the mrket rent adjustment that you are comfortable with. Add a cya statement that says market data is limited for supporting the individual line adjustments and therefore those adustments are made on the basis of the overall market rent data and an estimated assigned contributory value for each of the individual adjustments.
Don't know if I explained that very well. ie... use the data that you have confidence in to assign estimated contributory values to the individual adjustments-you will have the same value supported by what you know is the best way to do it and your client will also have it in the form they want it in.

Very nice.

 

[SANDY]

Ah Hah!! you finally found my setup! That is exactly what one would have had to do if they were too lazy to develop a sca!!! Your a little slow on the uptake!!!

Property-I hate to tell you this, but you and a few others here are not my peers!!! That goes for anyone out there using the same income approach method in both the income and sca approaches when they have adequate comparable sales data. In that case you are either being just plain lazy or just plain ole misleading. Hide your licenses because they will be coming to get it soon!!
Review the posts I cited-there are others that agree.

 

[Stone]

Property-I hate to tell you this, but you and a few others here are not my peers!!!

My guess is that he will sleep just fine with this knowledge.

 

[SANDY]

Just take your one overall market rent based adjustment and assign each individual adjustment a percentage of the one big adjustment based on your estimate of the value contribution of each of the individual components. ie... since the client is insisting on the individual adjustments that you are not comfortable with due to lack of data for the individual adjustments, just back into them using the mrket rent adjustment that you are comfortable with. Add a cya statement that says market data is limited for supporting the individual line adjustments and therefore those adustments are made on the basis of the overall market rent data and an estimated assigned contributory value for each of the individual adjustments.
Don't know if I explained that very well. ie... use the data that you have confidence in to assign estimated contributory values to the individual adjustments-you will have the same value supported by what you know is the best way to do it and your client will also have it in the form they want it in.

Be very very careful when using percentage adjustments to do them in the proper sequence-may have to get one of those books out to do it properly! I refer you to Austin for proper sequencing!

 

[SANDY]

Stone:

Actually, I think he's having trouble sleeping-knows he messed up!
Every knock on the door might be trouble!

 

[SANDY]

Greg- enhanced does not mean three income approaches with two disguised as cost and sales comparison approaches!!! You two guys are like the those guys in the movie dumb and dumber!

 

[SANDY]

PE: Like Dr. Phil says-how's your method working out for you? You finally ran into an underwriter that knows the following guidelines.

PE your thought that rent reflects market reaction to most adjustment criteria has some merit, however, per Fannie individual adjustments should be considered

XI, 406.03: Adjustments to Comparable Sales (11/01/05)
For two-unit to four-unit properties, the appraiser must report certain unadjusted and adjusted units of comparison for the subject property and the comparable sales. Because purchasers of small residential income properties may rely on these units of comparison, the appraiser should consider them in his or her analysis and reconciliation if they are relevant to the typical purchaser’s motivation in the subject market area

XI, 406.05: Underwriter’s Review of Adjustment Grid (11/01/05)
The underwriter should pay particular attention to the following areas. Because a substantial variance raises questions about the validity of using a specific comparable sale, the appraiser must have addressed the reason for a variance.

Proximity to subject property and location
Sales price
Sales or financing concessions
Date of sale/time adjustment.
Above-grade room count and gross living area
Over-improvements

 

[SANDY]

Well bad news for you boys Greg and Property- we held a trial here of your peers-2 certifieds and 1 general appraiser. You were both found guilty and the sentence is---

You must write 100 times on a chalkboard-"I will not profile trainees anymore"
You must take an AI course in the sales comparison approach
Austin will call you and repeat- "I won" 200 times
You must attend the next two AI meetings and courtsey in from of them twice during the meeting
You must eat a big ole slice of humble pie.

 

[CANative]

Have the 2 certifieds and 1 general register on AF and discuss this openly.

Otherwise...

zzzzzzzzzzzzzzzzzzzzzzzzzzzz

 

[PropertyEconomics]

Have the 2 certifieds and 1 general register on AF and discuss this openly.

Otherwise...

zzzzzzzzzzzzzzzzzzzzzzzzzzzz

Greg .... wake up man. The world is passing us by. There are arrogants out there .. DID YOU EVEN KNOW THAT?