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Agree or Disagree?

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MARKETVALUE

Thread Starter
Sophomore Member
Joined
Feb 11, 2002
Professional Status
Certified Residential Appraiser
State
Georgia
Hey gang-

A quick background and then my question for the evening. Several months ago I posted a couple of topics regarding reviews, me being on the receiving end. Since then I have picked up a review client who sends 40-60 a month my way. I would like to point out the wisdom in several of the response posts, all of you were correct when you pointed out how one must do reviews to fully understand the other side. I have seen more garbage both blatant and well dressed since we started doing reviews. It completely makes you question the sanity and skill level of appraisers in general.

Now my question, One of our fundamental positions in our company is to be bracketed everywhere on the appraisal; definately on sales price, GLA, acreage, age, condition, basements, baths, and adjusted sales price on the appraisal. Appraisals do not leave my office unless this criteria is met. If it isnt then there is a full page as to why and what adjustments were or weren't made. I have seen so many damn appraisal not bracketed with 99% being pump jobs. However, every now and then the appraiser some how backs into the value without bracket comps.

My stance is if you dont have a bracket comp then you can not accurately define the market for the subject property, at least with the sales comparison approach.

Agree or disagree?

MRM
 

Austin

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified General Appraiser
State
Virginia
Marketvalue: I agree, but go a step further. Not only do I say if not all value factors are bracketed then you can’t measure the value factor, but also I have found that you can learn more and gauge the gravity of value factors better by using sales that are not as comparable. If you use clone sales and end up with a value range all you have done is gauge random market variance. Also, I contend that you can’t import data into a marketing grid. Once you have selected the comparable sales everything you need to know has to be extracted from these sales. To use matched pairs from outside the comparable sales just contaminates the data and distorts the answer. If you use the correct sequence of adjustments the number of adjustments will be reduced drastically.
 

wyecoyote

Senior Member
Joined
Jan 15, 2002
Professional Status
Gvmt Agency, FNMA, HUD, VA etc.
State
Washington
I generally tend to agree to a point that bracketing should be completed. Myself and my partner both attempet to bracket the subject by all features.

However, in rare instances this is not possible. IE.. I completed a duplex a couple of months ago that was the largest duplex in the subject's market area and surrounding area by 1,000 SF. I even utilized a 4 plex (6th comp) that still did not bracket the subject by GBA. In these types of cases how can any appraiser bracket. And there tends to be alot of explanation.

I do agree in most cases it is possible but there generally tends to be those rare cases where it is not possible. I belive this happens more in rural appraising than in suburban/urban appraising.

Ryan
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
When one of my subs sent me a report that all three comps were higher than the sales price of the subject and all three adjusted to a value of roughly 30K Above that sales price, I kicked the report back with a copy of the appropriate page from an old California Appraisal Text book with the following words, "BRACKET, BRACKET BRACKET. If you don't understand call me!" She has been scared of me ever since, but she got the picture.....

ter
 

xmrdfghap

Senior Member
Joined
Jan 15, 2002
Professional Status
General Public
State
Florida
<span style='color:brown'>Bracketing is fine for properties that have similar comps, but unique properties frequently do not have anything similar and you may end up being outside the bracket one way or another. Being married to a "rule" means you will follow the rule rather than the research......and research is what your appraisal should be based on.</span>
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Knowing your market area; Research; and bracketing if possible - one of the best seminar's I ever attended, was one done by an old MAI friend of mine - Unigue and Vintage properties. It was filled with your non-typical appraisal and what to do, should there be a limited # of similar sales.

Seminars or classes of this nature should be available all over the country, because they are what the appraiser runs into more often than not.


8)
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
First, this thread is why I said a few months ago that this forum has many "Cream of the Crop" Appraisers that post here. Great question and answers!

Like others, I will bracket and can most often. The addendum with explanations is long when I can't and I squirm wondering if I missed something. It's almost always a property that is overbuilt for it's market area. It's very rare to have a subject smaller that all the comps and the red flags are flying high if that happens.

Marketvalue: Welcome to the review world. Very scary!!!! In another earlier post I said that I was very afraid that the number hitters or those that just don't know what they're doing might be as high as 75%. Now you know why I said that. Way too many certified appraisers were trained by the number hitters. I don't consider them Appraisers - just frauds. The really sad part is that so many of them don't even know what they are. :cry:
 

Tim Hicks (Texas)

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Texas
Exactly, Pam. As I always say, apprasiers are their own worst enemies. If it weren't for the majority (weak) appraisers in this world their would be no lender coersion. And, maybe I am just reviewing appraisals with red flags, but 90% of the appraisals I review are an insult to the appraisal industry.
 

slacker

Junior Member
Joined
Feb 20, 2002
Now my question, One of our fundamental positions in our company is to be bracketed everywhere on the appraisal; definately on sales price, GLA, acreage, age, condition, basements, baths, and adjusted sales price on the appraisal. Appraisals do not leave my office unless this criteria is met.

Bracket yes, but also keep the number of adjustments as low as possible.

If you are requiring that each appraisal bracket the 8 items above you're looking at a possible 336 different combinations between 3 comps. Seems like you would be asking for too many adjustments to be made. And with that many adjustments how would they be similar properties?
 

Bill_FL

Senior Member
Joined
Aug 23, 2002
Professional Status
Certified General Appraiser
State
Florida
I agree with slacker. One would want to attempt to bracket on any items of major contribution value, but nearly impossible to braket on every thing without having 20 comparables. I think that in situations like this, Austin's methods might be the only way to truely braket everything.
 
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