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An Interesting Avm Experience

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TRESinc

Elite Member
Joined
Dec 1, 2011
Professional Status
Licensed Appraiser
State
Ohio
one of my direct engagement clients uses AVMs for their equity lines and bridge loans, however if there is a problem (they don't like the value, borrower doesn't like the value, etc) they will then order a full appraisal. i completed one of these about 10 days ago.

lender calls me today and asks about a sale that i did not use. my unadjusted range of comp sale prices was $147k-$159k and the sale they asked me to look at was $188k, which i can only assume the borrower provided. while that sale was located near the subject's street like most it was not a comparable, just a higher priced sale (29% more GLA, complete renovation top to bottom, larger lot, younger house, bigger garage, more baths, etc. etc.). i called them back and explained what it was and why it wasn't used, they were good with that.

let me be crystal clear about this part - this was not a ROV, it was just a phone conversation, which is what happens when you work with a lender for ~20 years.

during the conversation we started talking about the AVM. (brief subject history - sold in early 2016 from HUD for $75,000 to the current owners, my appraisal came in at $155k after lots of renovations over the past ~2 years). the AVM value came in at $89k, which i can only assume was based in large part on the previous sale price of the subject which obviously did not take into account much else.

a full appraisal costs the bank $450. the AVM costs them $35. you get what you pay for :)
 

Digger88

Elite Member
Joined
May 11, 2010
Professional Status
Certified Residential Appraiser
State
Virginia
zillow under values my house by 150k and eappraisal over values it by 200k. our jobs are not in danger, lol.
 

Riick

Elite Member
Joined
Aug 14, 2007
Professional Status
Certified Residential Appraiser
State
Delaware
I just got a Sale in. Agreement is for roughly $75k.
Our friends at Zillow think it's worth $132k
> ".. our jobs are not in danger, lol."
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
the AVM value came in at $89k, which i can only assume was based in large part on the previous sale price of the subject which obviously did not take into account much else.
My niece got a gift house from her mother for mortgage which was $60k less than appraised from my bro.'s estate. Shows up as "sales price". Still under valued, Zillow very low. Appraiser little better, change banks, new appraisal near right.
 
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