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

[Lee Lansford]

Immediate, ideal... Any of those defined in USPAP? Has the OP offered any insight into "immediate"? I understand the strict interpretation of H&BU, but you and Lee as the head cheerleaders against the Fannie Mae announcement happen to live in areas where there is no gray area, its black and white, discrete, concrete etc....

No. Not at all.

It is Fannie's erroneous pronouncement that offers but one option.

 

[Andrei Fin]

I don't know why you're fixated on the likelihood or value of any future development - that isn't the question in an HBU analysis of a vacant parcel. Ever.

Have you ever appraised a vacant lot by itself? If so (And I'm assuming you have), on what basis did you value it? As some hypothetical use subject to completion, or as it sits in its "as is" condition? What comps did you use to value that parcel? Did you use finished homes or did you use other vacant parcels that were in the same condition as the subject as of their date of sale?


If the sales data exist in your market area to support the following conclusions:
Value of SFR on 7500 sf parcel = $380k
Value of SFR on 15000sf parcel = $430k
Value of vacant 7500sf parcel = $160k

Then which is worth more - in the market - as of the effective date"

$430k Value of SFR on 15000sf parcel

or
$380k Value of SFR on 7500sf parcel
$160k Value of vacant 7500sf parcel
$540k Value of the aggregate
less discount or premium for assemblage
$xxxk (to be determined after analysis)

I know you don't believe it happened in the one example I gave on Garfield, but do you believe that there are at least some instances where the second lot only sells for the value as lawn/site area? Provided the lender will accept the HBU box checked NO, do you think it's ok to appraise the property that way?

 

[George Hatch]

I'm not fixated on future development you and Lee are. H&BU as Lee suggests is IMMEDIATE. I love the irony of your use of Santora as your signature. GOD I wish he would pop back up, he would put the current baby back in the crib, but he was and in your current mindset would be excoriated as a heretic particularly because he chose his own H&BU with a GSE related entity job. Much like DW chose his H&U.

I'm curious why you think it is that Freddie hired someone like DW to that role instead of promoting someone from within? Or for that matter, why Servicelink actively *recruited* him out of private practice instead of promoting one of their own or poaching someone from their competition? What do you think it is about DW that obviously gave him the edge over all the insiders?

 

[George Hatch]

I know you don't believe it happened in the one example I gave on Garfield, but do you believe that there are at least some instances where the second lot only sells for the value as lawn/site area? Provided the lender will accept the HBU box checked NO, do you think it's ok to appraise the property that way?

I completely believe what happened on Garfield. Nobody (apart from the 2016 broker) bothered to compare the A properties to the B properties so they valued Garfield as an A based on the unfounded assumption that A=B. Which may or may not be similar on the purely accidental and coincidental basis.

As for the checkbox, I keep telling you; the checkbox works for me, not Fannie. And regardless how I checked the box I would proceed to clarify exactly what my opinion of HBU is in the report in a manner that nobody would be able to misunderstand.

As for the question of whether its OK to appraise a B property as if it were an A property, the answer is no - it isn't. However, it may be (and in that market probably is) necessary to use A properties as comps and then *consider and develop any applicable adjustments* that may be necessary to get to a supported opinion of the value of this B type property. That adjustment might be a "+", a "-", or an "="; I don't know, and I don't assume. That's an opinion to be developed, not an assumption to make.


No matter what, a "B" property is not exactly the same thing as an "A" property. Saying it is won't make it so, and neither will "Fannie will accept" make it so.

 

[djd09]

I'm curious why you think it is that Freddie hired someone like DW to that role instead of promoting someone from within? Or for that matter, why Servicelink actively *recruited* him out of private practice instead of promoting one of their own or poaching someone from their competition? What do you think it is about DW that obviously gave him the edge over all the insiders?

here we go again. big kisses? pucker up?

 

[Mr Rex]

Better start stretching... Like a new years resolution. See you there shortly. Want to gamble? Any amount. It's a done deal. USPAP will roll over and take it like the fat girl likes it. USPAP will love that its still relevant in its changing to meet the times.

 

[djd09]

i bet DW ex company did 1000's , if not way more, of multiple parcel appraisals, just like fannie wanted.

 

[George Hatch]

I can't believe we're having a FannieWorld vs USPAP discussion in 2019. It's as if the last 20 years on this forum never happened.

 

[George Hatch]

i bet DW ex company did 1000's , if not way more, of multiple parcel appraisals, just like fannie wanted.

Maybe so. I never talked to him about it when he was at SL.

 

[Lee Lansford]

i bet DW ex company did 1000's , if not way more, of multiple parcel appraisals, just like fannie wanted.

The issue is not one of multiple parcels comprising a subject property for an opinion of MV. Certainly there are instances where multiple parcels comprise a single property for the purpose of an opinion of MV. All the time is this true? No, of course not.

That some appraisers can't distinguish what is appropriate from that which is not, well, upon this I have no doubt.