Across The Board Time Adjustments?

[residentialguy]

It's not worth fighting over with

Why is that with most of your posts, you're bending over?

 

[J Grant]

Appraisers use the term time adjustment as a shorthand term for market condition adjustments...we all know that, but it';s good to be reminded of it. Because a time adjustment references date of sale or date of contract price changes, whereas market conditions also includes listing and pending activity and inventory vs supply , days on market, list vs sale price etc.

 

[DARREN GODFREY]

If we have no recent /contemporaneous sales, and no listings, and no agents to interview and context in other properties activity where the market is trending (conditions), either we cant' complete the assignment, or we can't apply a time adjustment, since we have zero indicator for doing so.

Usually there is surrounding and relevant market activity, even if no immediate contemporaneous comp sales, to indicate if a time adjustment should be applied, as well as if a time adjustment applies to all sales or just those that sold influenced by different conditions than are now trending.
The point is not to predict the future from dated sales. The point is to bring dated sales, if their price was influenced by their sale date/contract occurring in a different market phase than now trending, to bring their prices to the current as of effective date

I agree with you , when I took my first classes with really old school instructors they all said we were between everything but looking backwards in time ...it we develop a market as increasing we are doing it through trends that have already occurred .

 

[J Grant]

T- You are predicting the present- here now today, not the future. Because ALL your sales data is in the PAST.

We are not "predicting " the present. We are, if applying a market condition adjustment, bringing past sales prices that contracted /sold in a different trend cycle up to current trend market cycle impact on price .

 

[DARREN GODFREY]

One time a reviewer requested to make adjustments based on contract date. He may be right but that means I had to analyze contract dates for all comps. I adjusted what the reviewer wanted but my appraised value stayed the same.
It's not worth fighting over with. Adjusting contract dates not what my peers normally do.

Sounds like a sucky reviewer...I mean look if I am not dealing with something that would change the value of the report. Why bother and make someone else look bad. They had they're own method and we really don't have hard rules to follow.

 

[DARREN GODFREY]

I think the mistake that appraiser made is easy to make, especially in a recovering market.

Statistically it looks like most of my markets are increasing by like 15-20%, however if I do apples to apples first and last period , maybe I get 1-3%.

I don't like the MC form ...it's almost worthless.

 

[residentialguy]

I don't like the MC form ...it's almost worthless.

It shows the lender what's happening to similar properties in the subject's neighborhood. Wouldn't you want to know if the subject's similar housing is not selling well. It also supports your SCA. When you have to go out of the neighborhood, the MC supports you doing that by showing that there aren't many comparables to choose from. It also shows when an appraiser is trying to bump value by going out of the neighborhood, when there are plenty to choose from within the neighborhood.

 

[Eli]

It's not the form that is the problem, although the form could be improved. Improvement costs money on forms and appraisals.

 

[residentialguy]

You'd think the "great appraisers" involved with FNMA would have seen how bad the form is.

 

[Eli]

That's too deep for me to speculate. I am not sure the appraisers are to blame there.

I know to improve it and appraisals cost money. It won't rain down from heaven like manna. Not yet anyway.