Blown up about within 1 mile previously

[OG80]

Some of you on here blew me up when I mentioned I wanted to stay within a mile with my comps. Seems most of you don't adhere to that. So, I started to use comps more than a mile if needed and just got this revision request (not the first one either I might add):
-Please comment on why appraiser exceeded 1 mile for sales? 2-Please provide an additional sale within 1 mile that supports.

 

[Terrel L. Shields]

Seems most of you don't adhere to that.

I have a lot of assignments where there isn't a sale within a mile and occasionally not even another house, or no more than one or two houses.

So, how many sales are within a mile? No one is saying not to use sales within a mile but there is no requirement to use sales within a mile. You always want to use the best sales (more similar, recent and proximate) within the defined neighborhood. And if sales are scarce then use sales outside that neighborhood, preferably with most similar there. There is no FNMA or FHA requirement to comment on why you used sales outside a mile but there is an implied effort to use the best sales available. Fannie does not force you to use sales within 1 mile. Download the selling guide then hit ctrl F and type in "mile" and see if you find anything related to distance of one mile.
(c) Comparable Sale Selection
(i) Characteristics of the Property
Comparable sale selection must be based on properties having the same or similar locational characteristics, physical characteristics and the priority the market assigns to each factor, including:
• site;
• site view;
• location;
• design;
• appeal;
• style;
• age;
• size;
• utility;
• quality;
• condition; and
• any other factor that in the Appraiser’s professional judgment is recognized as relevant in the subject market.

 

[Vermonter]

Some of you on here blew me up when I mentioned I wanted to stay within a mile with my comps. Seems most of you don't adhere to that. So, I started to use comps more than a mile if needed and just got this revision request (not the first one either I might add):
-Please comment on why appraiser exceeded 1 mile for sales? 2-Please provide an additional sale within 1 mile that supports.

Your subject and market dictates the distance to comps. Not the GSEs, not a reviewer, not this forum.

Where is your mentor on this?

 

[glenn walker]

Since I began in 1983 the guidelines of Fannie..FHA..VA and lenders has always been that if you need to extend your search radius and use comparables farther out simply explain why "normally because you had none closer " then as added support try and use an additional one farther out.

That shows the appraser was not just going farther out to cherry pick higher outliers to inflate the value. No big deal you go as far as required the 1 mile limit was just a general guideline which the GSEs and lenders all say it's not a hard rule. JUST EXPLAIN in two lines and be done.

 

[CGinMN]

1 mile is just an arbitrary area. Sometimes it can yield sufficient data, and other times it does not.


Instead, ask the question, if this property were not available on the market, what would be the geographic area that buyers would be looking in to find a replacement? The answer to that is never within 1 mile of the subject, which is a random point on a map.

Nail down the concept of "market area" for the subject. Maybe it'll look more like this.


Once you figure out the market area, you'll know how to answer the underwriters' request for more proximate data.

 

[Surf Cat]

I'm blaming Shields....stinking rural appraiser...

 

[J Grant]

Some of you on here blew me up when I mentioned I wanted to stay within a mile with my comps. Seems most of you don't adhere to that. So, I started to use comps more than a mile if needed and just got this revision request (not the first one either I might add):
-Please comment on why appraiser exceeded 1 mile for sales? 2-Please provide an additional sale within 1 mile that supports.

Sorry but if you are clueless about markets and how or why buyers choose properties as subsitties for a subject ( our comps) you will have trouble appraising residential real estate - maybe ask a friendly RE agent or trade services with one to let you ride around with them or talk to them about how buyers choose houses . If you don't have a mentor or your mentor is incompetent ( a problem), then try to spend time or help out a seasoned experienced appraiser.

It is ideal to use comps within a mile in many cases - however, in a number of assignments, the best or better ( or only ) comps are located over a mile away. It is not about the rules , or regulations, it is about what makes sense in the appraisal development.

Your lack of comment or explanation about why you exceeded a mile was why it came back, not the distance itself. Clients l want an explanation even though a mile guideline has been retired as a GSE recommendation for comps.

 

[ucbruin]

I'm blaming Shields....stinking rural appraiser...

They may not be stinkiest....
But they are the whiniest....

 

[alebrewer]

My guess is that whomever submitted the revision request is seeing data that shows there are comparable sales proximate to the subject. Most reviewers are smart enough to look at a map and be able to tell if there are comparable sales within a mile or not.

A reviewer isn't going to ask for sales within a mile if the property is here:


But they will if the property is here:

 

[J Grant]

My guess is that whomever submitted the revision request is seeing data that shows there are comparable sales proximate to the subject. Most reviewers are smart enough to look at a map and be able to tell if there are comparable sales within a mile or not.

A reviewer isn't going to ask for sales within a mile if the property is here:
View attachment 98868

But they will if the property is here:
View attachment 98869

Good point. When I use a sale over a mile, I comment that I used it because it was more similar to the subject (or bracketed X feature ) better than sales within a mile - and I add other comments supporting the comp choice that apply.