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Active Listings in the 1025 SCA

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ZZGAMAZZ

Thread Starter
Elite Member
Joined
Jul 23, 2007
Professional Status
Certified Residential Appraiser
State
California
Statements:
I was trained to include sold comparables in the Sales Comparison Approach, and active listings or pending sales in the Rental Income Approach because they most accurately reflect the current market. (The current form is unlike its predecessor being absent comments concerning which types of comps to use, where.)

Including the latter two types in the SCA might result in a misleading GRM because the actual selling prices, if any, are unknown.

Whether to include active listings in the 1004--and whether to adjust those comparables for list/selling price--was the source of a looooooooong recent thread.

Question:
Is the 1025 2/4 Unit residential report remiss if the SCA is based upon sold comparables only, excluding active listings, which could be adjusted to reflect the local market ratio of list/sales price?
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
Depends on the Aging of both the LEASED rentals and the SOLD sales.
 

Gary Schinagel

Sophomore Member
Joined
Jul 3, 2008
Professional Status
Certified Residential Appraiser
State
New Mexico
I understand your reasoning for active data and adjustments but I have never heard of it before.
Why make 2 adjustments instead of one? Look for the most recent SOLD data and run with it. Then you will not have to make an additional adjustments and explain yourself. If you want to make an additional adjustment make it a current market adjustment(IF YOU CANNOT FIND recent data) based on the actual CLOSED sales instead +/-.
 
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