Appliance Listing Question

[Ray Miller]

Appliances in Grid Question?

I was taught that you leave the appliances out of the grid if they are not built in. Some lenders and all the owners want the appliances listed in the grid, some lenders do not if they are built in.

What say you which is the correct way?

Got stip again for not listing the stand alone appliances, as well as the wahser and dryer and the microwave on the kitchen counter.

 

[Vermonter]

I do "X" if it's built in, "P" if it's not.

Wait, you said grid...I list No appliances in the grid if there are none. If they're there, I just put "Poor/Fair/Average/Good/Excellent Kitchen"

 

[Mr Rex]

FHA says:

Appliances​

Make an entry [X] in the boxes to indicate that these items exist. An entry in a box means that the item was considered part of the real estate and is included in the value. If an item is personal property, put a
"P" in the box and do not include it in the opinion of value. Treat non-functioning equipment as existing, but as deferred maintenance in the valuation process​

.​

Field Protocol​

Refrigerator Enter “X” if this item exists. Enter “P” if personal property.
Range/Oven Enter “X” if this item exists. Enter “P” if personal property.
Dishwasher Enter “X” if this item exists. Enter “P” if personal property.
Disposal Enter “X” if this item exists. Enter “P” if personal property.
Fan/Hood Enter “X” if this item exists. Enter “P” if personal property.
Microwave Enter “X” if this item exists. Enter “P” if personal property.
Washer/Dryer Enter “X” if this item exists. Enter “P” if personal property.
Other Enter “X” for existing item not listed above and describe. Do not include personalty.​

 

[Peter LeQuire]

FHA says:


Appliances
Make an entry [X] in the boxes to indicate that these items exist. An entry in a box means that the item was considered part of the real estate and is included in the value.

Yep - I've always liked this part of HUD's protocol. Most of the houses in this area that are financed with FHA-insured loans are in a price range in which the appliances were probably low end to begin with, and are not new. The value of used appliances is generally a pretty small portion of their cost new or cost to replace, and the value of used appliances in relation to the value of the house as a whole is insignificant. The fact that most appliances - except the refrigerator - are left in these houses when they sell is probably a testimony to the fact that their owners don't think them worth moving.

 

[Mike Garrett RAA]

I just check the box on page 1 if the item is there. In the grid I use the term "Standard Appliances" or "Upgraded Appliances" or "No Appliances" or "SS Appliances" SS means stainless steel.

Often see appraisers who indicate, in the grid, Superior, Similar, or Inferior and adjust that way. Other appraiser will put something like "R,Ref,DW" in the grid and adjust accordingly.

While a refrigerator or range might be personal property, those items are generally included in the contract and usually affect the contract price somewhat so I include them in my value consideration. IN MY MARKET a large double door refrigerator could be as much as $2,000. Saw one the other day that was nearly $5,000 new and almost big enough to walk into.

I know this is contrary to what the FHA protocol is but then I don't like doing FHA appraisals...can't you guess?

 

[Mr Rex]

I just check the box on page 1 if the item is there. In the grid I use the term "Standard Appliances" or "Upgraded Appliances" or "No Appliances" or "SS Appliances" SS means stainless steel.

Often see appraisers who indicate, in the grid, Superior, Similar, or Inferior and adjust that way. Other appraiser will put something like "R,Ref,DW" in the grid and adjust accordingly.

While a refrigerator or range might be personal property, those items are generally included in the contract and usually affect the contract price somewhat so I include them in my value consideration. IN MY MARKET a large double door refrigerator could be as much as $2,000. Saw one the other day that was nearly $5,000 new and almost big enough to walk into.

I know this is contrary to what the FHA protocol is but then I don't like doing FHA appraisals...can't you guess?

Including personal property in the value is also contrary to Fannie & Freddie et al protocol.

 

[zdfenton]

HUD 4150.2 Appendix D

If the sale involves personal property (e.g. above ground pool, lawn mower, furniture, etc.) it should be identified and excluded from the valuation.

Fannie Mae Announcement 2010-09

Treatment of Personal Property
Lenders are reminded that personal property, including (but not limited to) furniture, vehicles, boats, floating boat docks, and art work, may not be included as additional security for any mortgage on a one-unit property unless otherwise specified by Fannie Mae. Personal property is permitted as part of the security for a loan on a two- to four-unit property to the extent it is pledged by the 1-4 Family Rider (Form 3170). Whether an item is real or personal property is generally determined by the law of the jurisdiction where the property is located. A professional appraiser who has the knowledge, experience, and geographical competence to complete the appraisal assignment must also possess the expertise to identify personal property items in the appraisal.

USPAP also requires Standard 7 competence to appraise personal property

 

[Don Clark]

I include all built in appliances(permanently attached or considered a fixture under the definition of real estate) in the grid but do not rate them. I also will not do as some AMC's/lenders want and state that the appliances are opperating/functioning properly. I will only state if they are there. If necessary I will state that I turned them on and the burners on the stove came on, the light in the refrigerator came on, the microwave made a sound, and the HVAC came on when it was turned on. Whether that is operating properly or not I have no clue as I am not an expert in appliances and HVAC.

 

[Mike Garrett RAA]

Listen guys, I know and understand what the protocols are and I concur personal property should not be included in the value conclusion; however, do you really feel appliances are "personal property" or are those items necessary for a fully functional residence?

Things like above ground pools, lawn equipment, cars, TVs, and a whole laundry list is what I believe the intent of the protocol is. I don't remember major appliances being included in that list. Now I could be wrong...won't be the first time.

We have more than 30 active builders IN MY MARKET. All sell properties with Fannie/Freddie conventional, FHA, and VA financing. It is most common for those sales to include major appliances including the refrigerator in the sales price. In fact, it's a requirement those appliances be in place prior to closing.

What ever happened to "common sense"?

 

[Mr Rex]

Common sense? What about the 42 inch widescreens most new builders are including these days? Average household has 2+ TVs, and over 99% have 1. How many households operate without a washer and dryer? Are these "required" also? Maybe one day appraisers will actually grow a set and deal in the black and white rather than the grey areas the RE agents and Builders love so.

I guess I should start requiring a boat in the contract for all the lakefront houses around here, now only a small percentage include the boat, but what lakefront house would be without at least one?