Builder raises prices, no comps, no resales

[J Grant]

Put me on that list. To me, the above is oxymoronic

? Oxymoronic is contradictory. I fail to see what is contradictory about it ( see my post above # 50 ). All I am doing is pointing it out- that the MV definition is the set of sale terms for the opinion of MV, as it is stated on the URAR ( and I assume many other forms or narratives has similar)

 

[J Grant]

The MV definition defines market value at a set of sale terms and conditions.

The appraisal is the opinion of market value ( USPAP literally defines an appraisal as an opinion) USPAP does not define an appraisal as a definition of market value.

USPAP ( and other sources ) can have different versions of MV definitions that are used in appraisals .

 

[George Hatch]

Everyone understands a definition of value isn't an appraisal. The definition of value used in appraisal does explain exactly which type of value the conclusion is intended to express, though. So we now circle back to (in those assignment where cited) MV being the most probable price of a hypothetical sale as of the effective date...etc.

 

[NachoPerito]

The MV definition defines market value at a set of sale terms and conditions.

The appraisal is the opinion of market value ( USPAP literally defines an appraisal as an opinion) USPAP does not define an appraisal as a definition of market value.

USPAP ( and other sources ) can have different versions of MV definitions that are used in appraisals .

This is just maybe too deep for me, into the weeds.

speaking of which, I am going to take some edibles tonight and get back to reading this. That will put me in the right frame of mind.

 

[J Grant]

Everyone understands a definition of value isn't an appraisal. The definition of value used in appraisal does explain exactly which type of value the conclusion is intended to express, though. So we now circle back to (in those assignment where cited) MV being the most probable price of a hypothetical sale as of the effective date...etc.

Agree. - (with a caveat )

. " market value" , as a concept,- per the definition is the most probable price, (the most probable price of a hypothetical sale as of the effective date at the MV definition terms)
However, the definition of MV ,and its equivalence to a probable price is STILL not one and the same thing as the appraisal/appraiser's opinion of market value.

Again, see my post 50. The market value opinion is the opinion developed by the appraiser from the appraisal (part A ) and the QUALIFER for part A,( as defined)" - is the MV definition. The MV definition states the terms of sale to achieve the most probable price. The appraisal development leads to the MV value opinion , expressed as an equivalence of most probable price as the point value..

 

[Tim Hicks (Texas)]

Some people post so much, I quit being interested in what they post. I just don't have to time to read their ramblings. Its a good thing I don't read my own posts.

 

[J Grant]

Everyone understands a definition of value isn't an appraisal. The definition of value used in appraisal does explain exactly which type of value the conclusion is intended to express, though. So we now circle back to (in those assignment where cited) MV being the most probable price of a hypothetical sale as of the effective date...etc.

Actually, I don't think "everyone " understands it....I think the reverse, that some appraisers believe the definition of MV literally is the appraisal. Just read the posts, esp early in thread where the content is about how to justify the builder's price increase. Now, the subject MVO may match or exceed the price increase. Or it might not . But the point is, they start out assuming it is worth the price because a buyer paid it, and working off that assumption, search for ways to support that ( the pendings from same builder ). That becomes appraising to a predetermined value,. .

The MV definition does not literally equate its price as a "market value" $ amount, " it's purpose, as you state, is to provide the TYPE OF VALUE (as defined ), for the appraisal opinion of market value

 

[J Grant]

Everyone understands a definition of value isn't an appraisal. The definition of value used in appraisal does explain exactly which type of value the conclusion is intended to express, though. So we now circle back to (in those assignment where cited) MV being the most probable price of a hypothetical sale as of the effective date...etc.

The other problem is that some appraisers fail to differentiate the real world transaction ( builder sale at X$ price ) from the most probable price of a hypothetical sale in the appraisal-.
The hypothetical sale in the appraisal which produces the most probable point value equivalence to the rest of the appraisal development, including past sales, comparative adjustments etc. Focusing just on the MV definition produces a price in isolation, even if the price occurred at MV terms. "

 

[NachoPerito]

Actually, I don't think "everyone " understands it....I think the reverse, that some appraisers believe the definition of MV literally is the appraisal. Just read the posts, esp early in thread where the content is about how to justify the builder's price increase. Now, the subject MVO may match or exceed the price increase. Or it might not . But the point is, they start out assuming it is worth the price because a buyer paid it, and working off that assumption, search for ways to support that ( the pendings from same builder ). That becomes appraising to a predetermined value,. .

The MV definition does not literally equate its price as a "market value" $ amount, " it's purpose, as you state, is to provide the TYPE OF VALUE (as defined ), for the appraisal opinion of market value

I don't understand you when you talk about price vs value, but I don't think I need to understand you. Are there examples where this can effect my work?

If you want to make a point like: Don't assume the property has a market value of $100k if it is pending at $100k.... that is a more straight forward way of saying it don't you think? But let's not beat around the bush. There is no better comparable sale than a pending sale of your subject property. You need a valid reason to make a conclusion like "the next buyer will not pay the same price as this buyer is"

You talk like we are discussing theoretical physics, but you are just warning appraisers to be organic about coming to a value and not appraising to a predetermined result?

 

[George Hatch]

One of current allegations in our business is that appraisers are concluding to less than the contract price more often for minority borrowers and locations than for non-minority borrowers and locations.

It is not our role as appraisers to act as an arbitrary chokepoint for the prevailing market trends in pricing, whether that trend is for increase or decrease.