Applying location adjustments: Adjustment protocol?

[ZZGAMAZZ]

Are there vacant site sales in these neighborhoods? If so, comparing them could give you some more insight

that's next weird because I almost Always conduct a vacant land analysis but totally forgot to do so although the subject and all comps are 15K - 35K sqft lot....

 

[ZZGAMAZZ]

Price per sq.ft.? Beverly Hills? I'm assuming you mean Los Angeles with Beverly Hills zip code. Even so, I wouldn't go over there from 91604. Go further back in time in Studio City. Expand your parameters to 25%.

Dude....you have the CRMLS. The CRMLS has InfoSparks. InfoSparks will give you the median sales price for each area (zip code if you want.. You can make a location adjustment with a difference in % of median sales prices. NOT P.P.S.F.

OR, you can use the drop down area (Valley Village, Sherman Oaks, etc.) locator in Los Angeles and download similar sales of each area to determine the percentage difference. You can also outline the areas in the MLS map section where your other comps are and download the data to determine the median sales price differences from there.

The subject is on a private road with a coldwater canyon address just off the major coldwater canyon road. I often used Infoparks in the past but got spoiled with the built-in charts provided by Spark for Appraisers, although this current research is base upon the CRML "STATS" function that I never used before, but that based upon the embedded "Basic Market Statistics" function revealed the following "Median $/SqFt" of $1,012, $1,174, and $838, for SC, BH, and SO respectively, with results based upon the same criteria throughout the same map area, about 2.0 mile radius primarily to east and south of the subject, i.e., I defined the map area without any city criteria, then conducted 3 searches throughout that area. Results revealed the 3 $/sqft--and although the values might, inherently, be relatively meaningless, that the primary subject physical and locational factor are used as search criteria, wouldn't the value be meaningful? But if so...so what...how should be be applied, as a percentage +/- ? I'm only using 3 of 9 nine comps without studio city addressses, so it isn't necessary to include them, but if the protocol is conducted appropriately, the results IMO will enhance credibility of results.

 

[ZZGAMAZZ]

Put in a couple comps make a location adjustment using your difference as a percentage of sale price how do they look

Question: Are you suggesting to determine dollar sqft differences btween subject and other two cities, then convert that dollar/sq difference into percentages [-Beverly Hills, +Sherman Oaks] , and apply those percentage adjustments to the selling price

Put in a couple comps make a location adjustment using your difference as a percentage of sale price how do they look

that was my first thought; however, the

difference between studio city $1,012 and BH, $1,174, = [-] $162.
$162 / $1,012 = ~16%
-16% applied to the selling price of a BH comp [12024 Summit Circle] = -$560,000 adjustment
$3,500,000 - $560,000 = $2,940,000

difference between studio city, $1,012 and SO $838 = [+] $174
$174 / $1,012 = 17.2%
--17.2% applied to the selling price of a SO comp [3843 Dixie Canyon] = $485,900
$2,825,000 - $485,900 = $3,310,900

HOWEVER, if this search protocol is applied, should that one adjustment suffice in lieu of all but the condition adjustment? Is the appraiser double-dipping by applying that percentage adjustment already controlled for all except the Condition factor??

As an aside, the tentative /preliminary OV is about $3,500,000 absent the location adjustment to reflect the city-address, although the sparse market activity that already resulted in comps a year or more in the past, as well as the subject's inferior condition, partially-functional lot, absence of recreational water features, absence of any view, etc., etc., warrants Gross adjustments of 15% - 20%. NOW the only other troubling factor is that although adjusted values of sold comps and active listings correspond....the adjusted values of 3 comps are significantly lower, to the extent that the list prices can only reflect list prices artifically low to stimulate competition, as I await return calls from 3 realtors. THANKS GUYS FOR ADVICE!!!

 

[ZZGAMAZZ]

I would also try to throw in at least 1 or 2 older sales from the immediate location as #4 or #5. Don't know what distances you are going, but if i saw all the comps not nearby, i would have it reviewed. You will also get a bad CU score, which makes the underwriter nervous. When i was reviewing and i saw no close comps, then i would go digging deeper. You never want your appraisal to be reviewed, they have all day to find your mistakes, and say mean things about you. And you ain't being paid enough for what you really have to prove, how smart you are.

HMMMMMM. I always figured that a location adjustment for a recent sale would be more reliable than a "time" adjustment for a older sale in the immediate vicinity of the subject.

Kinda sorted related question: How do AVM address factors such as proximity, contract date, etc., etc? I presume that all pertinent factors [except condition] are considered and weighted by the AVM protocol?????

 

[Tom D]

I am big old urban. Very little land sales, but i can do a supported time adjustment in a couple of minutes. Going to different locations is fine for 1,2,3. But you need aome local support being less than 2 years, maybe a model match for the subject. As the reviewer, you would make me have to look time back to see if you missed a model match. Even fannie say local older is better than further un local. But i would keep adding comps until my value looked obvious.

Avm just keeps shaking the salt shaker until the fewest adjustments appear. It don't explain anythin to anybody. And secrete being that an avm has numbers that it can't account for, just says i can't figure it out to da dollar.

 

[Joe Flacco]

I adjust it based on the difference in the value of the land and based on the comparison of the properties in the report.

 

[ZZGAMAZZ]

I adjust it based on the difference in the value of the land and based on the comparison of the properties in the report.

Oh, instead of introducing the city factor, because it is already baked into the selling price? By extraction applied to the comps in question, or by a market data analysis of vant land in the different locations???

 

[Joe Flacco]

Oh, instead of introducing the city factor, because it is already baked into the selling price? By extraction applied to the comps in question, or by a market data analysis of vant land in the different locations???

Paired sales of tear downs.

 

[ZZGAMAZZ]

Are there vacant site sales in these neighborhoods? If so, comparing them could give you some more insight

Not even one pertinent vacant land sale anywhere throughout Studio City for 365 days; no pending sales either; and 3 active listings.

 

[ZZGAMAZZ]

Price per sq.ft.? Beverly Hills? I'm assuming you mean Los Angeles with Beverly Hills zip code. Even so, I wouldn't go over there from 91604. Go further back in time in Studio City. Expand your parameters to 25%.

Dude....you have the CRMLS. The CRMLS has InfoSparks. InfoSparks will give you the median sales price for each area (zip code if you want.. You can make a location adjustment with a difference in % of median sales prices. NOT P.P.S.F.

OR, you can use the drop down area (Valley Village, Sherman Oaks, etc.) locator in Los Angeles and download similar sales of each area to determine the percentage difference. You can also outline the areas in the MLS map section where your other comps are and download the data to determine the median sales price differences from there.

SC: I followed-up on your comments about the [absence of] proximity of the subject to what I thought might be potential comps in Beverly Hills. A map search reveals that properties with street addresses in Beverly Hills 90210 are within 210 feet of my subject. Please clarify the criticism. [Maybe this is a good example of the reason that geo-competency was removed from the apprisal lexicon a few years ago because even a dullard like me with a computer can find his way around. Now if I could only learn to trust the Navigation System...but Old Guy Code won't allow that level of trust, as I become more n more n more of a luddite everyday, with every new mandatory password...