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Are we assuming to much here??
- Thread starter Jeff Horton
- Start date
- Status
Tom Hildebrandt
Member
- Joined
- Jan 16, 2002
- Professional Status
- General Public
- State
- North Carolina
Jeff
Of course you can appraise a property you have never seen if that is what the specifics of the case merit. Defining the appraisal problem is the key element that allows you to decide the requisite scope of work.
If you are asked to do a retrospective appraisal for court testimony for an attorney who has a client whose home was torn down by an overly aggresive city contractor three years ago and a new ball park now sits on the site, there is nothing in USPAP to prevent the appraiser who is competent in such work from providing the requested appraisal.
The issue of competency in such matters is a matter of discerning judgement, and in recognizing that the data collection will be difficult, many assumptions, or even hypotheticals will be needed. So long as you have adequately defined the appraisal problem and the related scope of work (client, use, users, date, assumptions, relevant property characteristics, etc), gather the appropriate data, competently analyze the data, and provide logic conclusions from the data, you would be OK.
Will your report be as reliable (or credible) as the appraiser who was actually in the house the week before it was torn down? All other things being equal but assuming each appraiser did an equally competent job for their particular assignment conditions, one would not expect your appraisal (value conclusions) to have the same degree of reliability or credibleness as the other appraisers, but you could still do the work in accordance with USPAP.
The key issue is what would other appraisers, experienced in the same or similar assignments, would expect for you to do in the data collection and analysis phase of the assignment. Clearly the biggest problem is getting a
good idea of the physical characteristics of the subject, and the related problem of finding comparable sales. In this scenario, tax records, old MLS records, photos and discussions with the property owners and neighbors, obtaining prior apprasials from banks, etc, etc.
In my opinion, the actual question you posed is similar in concept. What the client has done is agreed with some limiting conditions which require you to make some assumptions. If you have sufficient data that they have provided and it is consistent with other information that you have available, you can develop an appropriate value conclusion. When communicating the appraisal, you need to make the assumptions clear so that other intended users (not just the loan officer) understand the limitations. If the information you have is inconsistent (say GLA or year built is very different), you can still do the appraisal but you would need to disclose the issues. Better yet, another call to the lender. At some point in time, the increasing limiting conditions would make the report unreliable for the use of type of lending proposed by the client, that is a professional decision that you have to make after discussion with the client.
Regards
Tom Hildebrandt GAA
Of course you can appraise a property you have never seen if that is what the specifics of the case merit. Defining the appraisal problem is the key element that allows you to decide the requisite scope of work.
If you are asked to do a retrospective appraisal for court testimony for an attorney who has a client whose home was torn down by an overly aggresive city contractor three years ago and a new ball park now sits on the site, there is nothing in USPAP to prevent the appraiser who is competent in such work from providing the requested appraisal.
The issue of competency in such matters is a matter of discerning judgement, and in recognizing that the data collection will be difficult, many assumptions, or even hypotheticals will be needed. So long as you have adequately defined the appraisal problem and the related scope of work (client, use, users, date, assumptions, relevant property characteristics, etc), gather the appropriate data, competently analyze the data, and provide logic conclusions from the data, you would be OK.
Will your report be as reliable (or credible) as the appraiser who was actually in the house the week before it was torn down? All other things being equal but assuming each appraiser did an equally competent job for their particular assignment conditions, one would not expect your appraisal (value conclusions) to have the same degree of reliability or credibleness as the other appraisers, but you could still do the work in accordance with USPAP.
The key issue is what would other appraisers, experienced in the same or similar assignments, would expect for you to do in the data collection and analysis phase of the assignment. Clearly the biggest problem is getting a
good idea of the physical characteristics of the subject, and the related problem of finding comparable sales. In this scenario, tax records, old MLS records, photos and discussions with the property owners and neighbors, obtaining prior apprasials from banks, etc, etc.
In my opinion, the actual question you posed is similar in concept. What the client has done is agreed with some limiting conditions which require you to make some assumptions. If you have sufficient data that they have provided and it is consistent with other information that you have available, you can develop an appropriate value conclusion. When communicating the appraisal, you need to make the assumptions clear so that other intended users (not just the loan officer) understand the limitations. If the information you have is inconsistent (say GLA or year built is very different), you can still do the appraisal but you would need to disclose the issues. Better yet, another call to the lender. At some point in time, the increasing limiting conditions would make the report unreliable for the use of type of lending proposed by the client, that is a professional decision that you have to make after discussion with the client.
Regards
Tom Hildebrandt GAA
Bryan (OK)
Sophomore Member
- Joined
- Jan 17, 2002
Just don't tell the neighbor you borrowed his dog . . . just in case . . .
Jeff Horton
Senior Member
- Joined
- Jan 15, 2002
- Professional Status
- Certified Residential Appraiser
- State
- Alabama
After reading all the answers to this I have to admit I feel a bit foolish. I have been asked to appraise a house that burned and that is not really any different that this. I really asked before I thought that one through. The answer was just obvious I guess. I fell like saying "Well DUHHH Jeff"
I just got back and got a look at the house this time. I just drove down the private road with no problems. The house was easy to pick out.
Last time I tried I had a freind of ours with us. She can not drive due to vision problems and sometimes rides with to get out of the house. Since she was with me I didn't want to chance a confrontation with an angry homeowner.
Again, as always the advice was excellent!! Thanks!
BTW, there is a neighborhood dog I would have loved to take with me and left there!
I just got back and got a look at the house this time. I just drove down the private road with no problems. The house was easy to pick out.
Last time I tried I had a freind of ours with us. She can not drive due to vision problems and sometimes rides with to get out of the house. Since she was with me I didn't want to chance a confrontation with an angry homeowner.
Again, as always the advice was excellent!! Thanks!
BTW, there is a neighborhood dog I would have loved to take with me and left there!
George Hatch
Elite Member
- Joined
- Jan 15, 2002
- Professional Status
- Certified General Appraiser
- State
- California
Is there any chance we can reconsider the 'inspection by ruse' technique? Not to be a downer here, but it doesn't seem like the kind of conduct I would want to have to explain or justify should a complaint ever come in. If the occupant is hostile and we don't have a legal right to be there, I don't see how lying our way into the house is going to provide enough of a look to classify it as an inspection anyways.
I think an argument could be made that this would be an ethical violation.
Just a thought...
George Hatch
I think an argument could be made that this would be an ethical violation.
Just a thought...
George Hatch
A
Anonymous
Guest
Could you show me in USPAP where it says one must inspect the property? Even from the road?
Tom Hildebrandt
Member
- Joined
- Jan 16, 2002
- Professional Status
- General Public
- State
- North Carolina
Bill
You are absolutely correct, USPAP does not say you must inspect the subject or the comps.
The appraiser determines the appropriate initial scope of work after discussion with the client about the purpose, use, the known property characteristics and any other intended users. For your mother in law who wants an idea of what the market value of her house is worth just so she can sleep at night, you might be able to do just a sales approach at your desk and provide an oral report. Appraising the same house for estate purposes, and possible review by IRS, would probably warrant inspection of the property and comparables, a cost approach and a summary report. Different use, different level of development (Std1) and reporting (Std 2)
The concept that "One size fits all" in appraising is not consistent with USPAP and competent professional appraisal practice. The use, client and other intended user and property characteristics must be considered in deciding the relevant scope of work. What is important is that your scope of work decision is appropriate relative to what your client expects and what your peers would expect in the same or similar assignment.
Regards
Tom Hildebrandt GAA
You are absolutely correct, USPAP does not say you must inspect the subject or the comps.
The appraiser determines the appropriate initial scope of work after discussion with the client about the purpose, use, the known property characteristics and any other intended users. For your mother in law who wants an idea of what the market value of her house is worth just so she can sleep at night, you might be able to do just a sales approach at your desk and provide an oral report. Appraising the same house for estate purposes, and possible review by IRS, would probably warrant inspection of the property and comparables, a cost approach and a summary report. Different use, different level of development (Std1) and reporting (Std 2)
The concept that "One size fits all" in appraising is not consistent with USPAP and competent professional appraisal practice. The use, client and other intended user and property characteristics must be considered in deciding the relevant scope of work. What is important is that your scope of work decision is appropriate relative to what your client expects and what your peers would expect in the same or similar assignment.
Regards
Tom Hildebrandt GAA
Robert Dunkle
Senior Member
- Joined
- Jan 17, 2002
- Professional Status
- Certified General Appraiser
- State
- Oklahoma
George,
I COULD be wrong, but I think most of the suggestions were made with tongue firmly in cheek. I would fake being lost to get a driveby glimpse, but would NEVER get out of my car in a situation as described.
I have used comps that were in gated communities or on 40 acres with a locked gate substantial private road, but had MLS pictures and conversations with the Seller, Buyer and Agent.
I COULD be wrong, but I think most of the suggestions were made with tongue firmly in cheek. I would fake being lost to get a driveby glimpse, but would NEVER get out of my car in a situation as described.
I have used comps that were in gated communities or on 40 acres with a locked gate substantial private road, but had MLS pictures and conversations with the Seller, Buyer and Agent.
Dave Smith
Senior Member
- Joined
- Jan 14, 2002
- Professional Status
- Certified Residential Appraiser
- State
- Wisconsin
George:
I tend to agree with you. Subterfuge (ruse) is a lie.. it may be a little white lie but when does a little white lie become a big white lie? Maybe Billy Bob Bubba Clinton could answer that one!
Once we start down the trail of lies there is no turning back. If we tell the truth we don't even have to remember what we said! :mrgreen:
I tend to agree with you. Subterfuge (ruse) is a lie.. it may be a little white lie but when does a little white lie become a big white lie? Maybe Billy Bob Bubba Clinton could answer that one!
Once we start down the trail of lies there is no turning back. If we tell the truth we don't even have to remember what we said! :mrgreen:
Jeff Horton
Senior Member
- Joined
- Jan 15, 2002
- Professional Status
- Certified Residential Appraiser
- State
- Alabama
I agree guys. While I love some of the ideas given I would never do that. Well maybe take the neighbors dog....... Naa, just would like too. 
I have not had a bad experience on Drive-bys so far. I have been confronted a several times by concerned neighbors and owners of comps. I have always explained what I was doing, given them a buisness card and that was that. Of course I had the car in drive and was ready to leave fast just in case. I had one guy that was about to make me mad when he finally hushed. I decided that from now if they push me I am going to give them a card, tell the write down my Tag Number and Call the Sheriff. I will be back in the office in hour and have them contact me if they have any questions and drive off.
I have not had a bad experience on Drive-bys so far. I have been confronted a several times by concerned neighbors and owners of comps. I have always explained what I was doing, given them a buisness card and that was that. Of course I had the car in drive and was ready to leave fast just in case. I had one guy that was about to make me mad when he finally hushed. I decided that from now if they push me I am going to give them a card, tell the write down my Tag Number and Call the Sheriff. I will be back in the office in hour and have them contact me if they have any questions and drive off.
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