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Appraising an outlier properties

Surf Cat said:
Okay, now we're getting somewhere.... this property is an "over Improvement" for the development not functional obsolescence. I would certainly do an analysis of the entire development (time does not matter... research all the properties three to five years back if you have to) to make sure that your subject property is the white elephant of the development.

I disagree. You need to go to different, alternative, competitive areas to make sure that a 1700 sq ft dwelling is an over Improvement.... if you find one, grid it and do a location adjustment. Otherwise, you won't be bracketed.

Also, from the alternative, competitive neighborhoods with 1700 square foot properties, you'll be able to derive a percentage difference between 1,000 and 1700 square foot sales. With this percentage difference, you won't need to use linear regression.
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I am using linear regression as support not the main form of determine the over improvement and believe me it worked
 
J Grant said:
The subject may well not be worth 300k , but I do not see why having a swimming pool is funct obs. Why not adjust up for it having a pool and use some comp with a pool to bracket?

It is larger than the others, which may or may not be an over improvement - there is nothing wrong with going to a similar competing area or back in time to see the effect of larger sf - it might deserve being valued for the additional sf ? If nobody is paying for larger homes of that size within x miles maybe it is worthless sf of funct obs, or maybe it is a sf that others besides this one buyer would pay more for - perhaps not as much for as the sale price but it might have some contributory value. -
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You know what i will adjust for the pool? "0 "
 
App601 said:
I am using linear regression as support not the main form of determine the over improvement and believe me it worked
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Okay...... do you have a 1700 ft Property to bracket the subject?
 
TerryRohrer said:
Uhmmmm....
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Okay... you got me. Super adequacy is a form of functional obsolescence.

I'm not convinced though. The op only went 12 months back in time. A deeper dive might turn up a larger dwelling within the development.
 
App601 said:
You know what i will adjust for the pool? "0 "
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No value for pool?
It must be a unique area.
Even though it's a money pit to maintain, it's nice to look at when not having a waterfront view.
 
By making the blanket statement that you will not consider sales from other neighborhoods is super restrictive and I believe has an impact on your ability to complete this assignment. Take a look at several other neighborhoods and see what the difference in pool homes and non-pool homes and homes that are 30+% larger than the median for the development. The results were of those two amenities difference should give you some support for making adjustments to your comps.
 
The op needs to find a 1700 sq ft Property..... whether that means going back in time 5 years or going to a superior neighborhood and calculating a location adjustment.... PLUS.... find a comp with a pool. Otherwise, there'll be two red flags in their report.....
 
Surf Cat said:
The op needs to find a 1700 sq ft Property..... whether that means going back in time 5 years or going to a superior neighborhood and calculating a location adjustment.... PLUS.... find a comp with a pool. Otherwise, there'll be two red flags in their report.....
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Sounds like Appraisal 100.
 
glenn walker said:
That's not always true but your in Puerto Rico and that's a whole different world. You talk about a $300,000 home like it's Beverly Hills prices. Hell a Mobile Home out here in a rented park space is often more than that.

** If I were you I would try to get local appraisers in your area as mentors or to call for advice. Few on AF know anything about your Island or property quirks and your bringing in a Toyota to a Mercedes Mechanic.
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He gave is an over view of 50 sales in the subdivision maxing out at 220k. That gives us a good idea of what prices are in the sector PR he is dealing with.
I appraise a 150k condo one day and a million dollar condo the next - each has its own set of comps and values - in a relatively small geo area.
 
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