Another "paired" appraisal allegation, Seattle

[TerryRohrer]

Even a layman should be able to view the maps of listings and sales posted above and conclude that, regardless of the condition of the subject, the $670,000 is far more probable than the $929,000. And most would readily observe the differences pointed out in earlier posts. But clearly, until these conversations involve appraisers talking about what they do and how they do it, and what may be wrong with appraisals that have been done, and as long as only Korver and Perry are consulted about what is actually happening, it will be a long, extended winter!

 

[J Grant]

I would assume this will become a PAVE case study. Will the lesson be when an appraiser is in a house, they should not form a conclusion of comparable selection based on interior furnishings and decor which would indicate race or the skin color of the person(s) in the house? Or, will the lesson be that comparable selection should be based on higher priced comparables which would reflect white neighborhoods? Or will it be that comparables that have a black influence should not be considered (How is the appraiser suppose to figure that out?). Or, will it be the solution is to only have a similar, minority appraiser do the appraisal? Or, leave it to an AVM to figure it out?

. Are you serous in the thought that appraisers are supposed to take from this change their comp selectin to consider racial components? Or is it sarcasm. Because if you really believe that using racial selection or a minority appraiser is a possible solution I don't know what to say.

The worst outcome is if the powers that be decide to use an AM instead. Which is pretty far fetched to consider but it is within the realm of possibility. I despise the FF agencies for exploiting these rogue cases of staging as proof of actual bias problem exists on any scale to support their agenda of reducing reliance on appraisals . They have lost whatever little trust is left from appraisers by doing that.

The only response to this by apprasiers is to ask to have the appraisals made public /and explain how a second appraisal was ordered and who ordered it.

As far as defending our work, it is the same basic principles it always has been - the best comps selection means using properties having the most similar characteristic as substitutes for the subject.

 

[J Grant]

Even a layman should be able to view the maps of listings and sales posted above and conclude that, regardless of the condition of the subject, the $670,000 is far more probable than the $929,000. And most would readily observe the differences pointed out in earlier posts. But clearly, until these conversations involve appraisers talking about what they do and how they do it, and what may be wrong with appraisals that have been done, and as long as only Korver and Perry are consulted about what is actually happening, it will be a long, extended winter!

The villains in this are the "second appraiser" number hitters who are pushing value - the agencies know it,- or should know it. Instead of addressing that as the real problem, they are running data that show a small difference in a few census tract sales transactions of values below a CS price to indicate a "bias problem " exists.

 

[TC]

As for all the whining about adjustments, the first rule for adjustments is to pick the comps that are as similar as possible so that you don't HAVE to make a bunch of adjustments. Comp selection is where most of the valuation is occurring.

Had an instructor say that exact same thing years ago. If you're making a long list of adjustments, Is it really a comp?

 

[Elliott]

From the King5 article: "According to the U.S. Department of Labor, 96.5% of appraisers are white and 70% of them are men."

For the record, 64% of degreed college educated people are white males:

 

[Joe Flacco]

This property is two doors down from the subject and looks like it is similar condition compared to when the Clarks bought the house in 2018. They added a extra bathroom, updated existing bathroom, and remodeled the kitchen since.

This sale would suggest that the Clarks house value should probably be greater than $800k as of April 2022.

 

[Joe Flacco]

This house across the street is obviously a more extensive renovation. Just looking at the house and looking at the photos, the 2,120 SF probably includes the basement. So the Clarks house obviously less than this house which sold for $1.1 M.

 

[J Grant]

Had an instructor say that exact same thing years ago. If you're making a long list of adjustments, Is it really a comp?

I try to find comps that need the fewest adjustments, but for some appraisals that simply is not possible. But even using disparate properties needing more (or larger) adjustments, the reason for the comp selection should be clear ( no better ones available/it is a unique subject or area ) and the adjustment amounts should be supported and make sense.

I also tend not to adjust for minor differences among properties -

 

[Dublin ohio]

View attachment 69885



This property is two doors down from the subject and looks like it is similar condition compared to when the Clarks bought the house in 2018. They added a extra bathroom, updated existing bathroom, and remodeled the kitchen since.

This sale would suggest that the Clarks house value should probably be greater than $800k as of April 2022.

Something seems questionable about that sale. It was listed for $599,000.00 on 04/30/2021 and sold 21 days later for $782,001.00 I know the market was crazy. But..........

3537 S Bennett St, Seattle, WA 98118 | realtor.com®

View 28 photos for 3537 S Bennett St, Seattle, WA 98118, a 3 bed, 1 bath, 1,320 Sq. Ft. single family home built in 1920 that was last sold on 05/21/2021.

www.realtor.com

 

[George Hatch]

IMO appraisers are making some unforced errors, starting with not adequately defining the appraisal problem they're solving.

This property exists in a neighborhood comprised of a mix of ages, sizes, conditions and features, and which has a combined sales history that includes both highs and lows. The subject's market segment will often be but a subset of the whole, meaning that market segment will usually fit somewhere within.

As far as I'm concerned, telling appraisers to limit their summary of the housing trends on pg1 of the URAR to only the subject's market segment instead of to all properties in the neighborhood amounts to incompetence and malfeasance on that part of the GSEs. Like it not, many appraisers will only work to the form and will look no further than that.

Then there's the subject attributes. Everyone here knows how that works so I won't belabor the point. But what I will say is that if an appraiser has adequately summarized the composition and trends of both the geographic neighborhood AND the smaller market segment in which the subject more directly competes then the next step is to quantify where the subject's attributes fit into these ranges. IMO and based on what I've seen in most SFR appraisals I have ever reviewed, this field at the bottom of page 1 doesn't usually get used as well as it could be:


Saying the subject is below average, average, or above average for its market segment (as was being analyzed in the 1004mc) doesn't adequately reflect to how the subject might fit into the entirety of the neighborhood. THAT's how the 2nd appraiser can get away with picking superior quality/condition properties and passing them off as being "most similar".