Bad advice from Fannie--"Multiple Parcels" from Dec. 2019 'Appraiser Update'

[Mr Rex]

2 properties, adjacent. One owner.

One SFR improved; H&BU is as improved.

2nd parcel is vacant. The market says that the H&BU is for SFR development.

Each parcel has a MV of $350k. Each.

The market rightly sees these as two properties.

Mr. Loan Officer comes along and asks that the appraiser offer but one opinion of MV.

Questions for you:

1. Should the appraiser ignore H&BU and offer one opinion of MV?

2. If the appraiser does as asked, how might the appraiser avoid X'ing NO to the question "Is the H&BU as improved the current use?"

I am trustful that you see the problems here.

You seem hung up on a check box. IIRC even the "new" written directive from Fannie didn't direct the appraiser which checkbox to check (I may be wrong) But can I opine a MV? Well, I am an appraiser. So are you offering up your opinion as a former Appraisal Board member or a representative of the AI? I ask because I have not seen their hue and cry yet. Perhaps our old friend DW, a former ASB chair and current employee of a former GSE can shed some light on how egregious a USPAP violation it is to appraise a property with a secondary lot that may or may not have "immediate" H&BU as a separate lot via a "simple" H&BU test. I can't help but feel that you are the kind of Appraisal Board member that Terrell has spoken of so often. With all due respect, a little introspection may be appropriate. MHO. Merry Christmas.

 

[J Grant]

Lee- re HBU classes - you have a rigid fixed idea regarding HBU and do not consider any other perspective, nor apparently, the market. You ignore the rich for discussion pasting from source the dictionary of RE/ and Ellliot article...cheers, holiday coming up...

 

[alebrewer]

gain, if an appraiser can't do a simple H&BU analysis for the case at hand, that person should not be appraising.

Actually, per USPAP, they do have the option of gaining competence... another option, of course, would be to recuse themselves from the case at hand...

 

[Lee Lansford]

You seem hung up on a check box. IIRC even the "new" written directive from Fannie didn't direct the appraiser which checkbox to check (I may be wrong) But can I opine a MV? Well, I am an appraiser. So are you offering up your opinion as a former Appraisal Board member or a representative of the AI? I ask because I have not seen their hue and cry yet. Perhaps our old friend DW, a former ASB chair and current employee of a former GSE can shed some light on how egregious a USPAP violation it is to appraise a property with a secondary lot that may or may not have "immediate" H&BU as a separate lot via a "simple" H&BU test. I can't help but feel that you are the kind of Appraisal Board member that Terrell has spoken of so often. With all due respect, a little introspection may be appropriate. MHO. Merry Christmas.

Nonsense.

What do you believe will happen when the appraiser X's NO to the H&U as improved question? Your "hung up on the check box" is an interesting take on the matter.

I see that you chose not to respond to the scenario that I offered above. Given your response here, I understand why that is.

 

[Lee Lansford]

deleted///duplicate

 

[Lee Lansford]

Lee- re HBU classes - you have a rigid fixed idea regarding HBU and do not consider any other perspective, nor apparently, the market. You ignore the rich for discussion pasting from source the dictionary of RE/ and Ellliot article...cheers, holiday coming up...

I'll be certain to share your thoughts with the 3 (that I am aware of) former members of the ASB who have concern with the matter that opened this long-string and have them consult with you so that they see the light.

 

[Lee Lansford]

You seem hung up on a check box. IIRC even the "new" written directive from Fannie didn't direct the appraiser which checkbox to check (I may be wrong) But can I opine a MV? Well, I am an appraiser. So are you offering up your opinion as a former Appraisal Board member or a representative of the AI? I ask because I have not seen their hue and cry yet. Perhaps our old friend DW, a former ASB chair and current employee of a former GSE can shed some light on how egregious a USPAP violation it is to appraise a property with a secondary lot that may or may not have "immediate" H&BU as a separate lot via a "simple" H&BU test. I can't help but feel that you are the kind of Appraisal Board member that Terrell has spoken of so often. With all due respect, a little introspection may be appropriate. MHO. Merry Christmas.

Your reference to "DW" is, I imagine, to Danny Wiley. Why not PM and ask him his opinion?

In the interim, you may want to consider a bit of introspection .

 

[J Grant]

I'll be certain to share your thoughts with the 3 (that I am aware of) former members of the ASB who have concern with the matter that opened this long-string and have them consult with you so that they see the light.

Fine, I'd be happy to hear from them and explain my thoughts. You have my permission to have them read my posts on it, contact me, whatever. PM me whenever they are available .

 

[George Hatch]

The assemblage to which we are referring consists of two different property types. Not just one property type.

Normally (and everywhere outside of FannieWorld) when there's a mixed use or an assemblage of disparate uses onsite the first step is to put a retail value on each component in order to have a conclusion against which to apply the discount. I see a whole bunch of commentary here that seems to imply a methodology that either skips that "value each component first" or which uses a third property type (SFR on an oversized lot) which doesn't directly compare to either of the existing components.

When we're valuing an assemblage we usually start with the retail of each, then develop the discount for the terms of sale (meaning the bulk sale). And we usually don't discount the one component - they will usually all contribute less - especially when they consist of disparate uses; so we discount the retail of each component prior to adding them together.

 

[BRCJR]

If the excess land (additional lot) has a value of 100,000 and the improved lot (model match) has a value of 100,000 would the typical market participant pay 200,000, less than 200,000 or more than 200,000 if vacant and ready for independent development?

Economies of Scale says the two lots combined would bring less than the two lots separated. If so, is a combined lot the H&BU?

What am I misunderstanding?