Can I do this no inspection appraisal and be safe?

[Mike Boyd]

She #1 (your client) gets a no inspection appraisal. She #2 gets a full report with an inspection. You come in at $110,000, The other appraiser comes in at $130,000......or visa versa.
which one do you think will carry the most weight?

It is a manufactured home. How do you know if it is on an approved foundation? How do you know that the septic system is functioning and that raw sewage is leaking into the yard? How do you know if there is potable water....if it is on a well?

She should go to court and claim a specific value. She(your client) is a Realtor, right? Without an appraisal from her, she #2 will not likely get an appraisal. Your client can provide a CMA while her ex partner probably would not think of it. Most likely, if the judge thinks the case has merit, he will order the plaintiff and the defendant to each have appraisals done by State Licensed or Certified appraisers. Then, they can be done right. I do not see why you want to stick your neck out.

I have been wracking my brain trying to figure out who this agent is unless it is a 30+-year old with a name that is the same as a clerk/announcer from a Royal Court in days of yore.

 

[CANative]

a name that is the same as a clerk/announcer from a Royal Court in days of yore.

LOL... yep.

As to the other issues, the report would speak for itself about the data limitations and assumptions made.

 

[Zero]

Greg,
No matter how you slice it, this is another "intended use" question, like the ones you post me the pictures of that Autobus thingy for. Either I fell out of that thing or more likely I never got in.

It is relatively common in some circles to get a "preliminary" appraisal where the intended use is to assess the feasibility of litigation or to create starting points for negotiation. Sometimes, a reported value that is only one end of a range is sifficient for such intended users. Any critique that the work is not sufficient to stand alone as evidence in court or at mediation is misgided, because that is not the intended use. It's not even unheard of for attorneys to contract for such work to be communicated with an oral report to avoid creating discoverable documents. (And oh my, there is no "form" for an oral report ).

Good luck, if you decide to hop out and do some of your own driving. :new_ukliam2:

1) I'm reviving this thread because I have been asked to do just this...a preliminary desktop for a divorce. I have done a few divorces for this attorney in the past, but for this one he is not sure if it's going to be mediated, court tried, etc. I told him if he wants a "desktop" I will do it, but I will very conspicuously note in the intended use, engagagement agreement, and other places in the report, that this is NOT intended for litigation, but only for, like Steve says above "feasiblity of litigation or a starting point for negotiation" in a divorce not for consideration in court and/or for testimony as an expert witness. That would require full inspection. He said he was OK with that. If the client/attorney is clear on what he wants and what he will get, is there really a problem here?

I typically don't do desktops because a)I don't like to do them for people looking for the cheap and easy way out, thinking they can use this for whatever, only to explain to them the use will be extremely limited, and 2)I charge at least $200 for them and usually try to get a "full" done if possible. This client understands the use limitations, is willing to pay the fee, and understands that any further legal action will require a new appraisal with a new fee, plus agreement to rates for court time.


2) Now for the problem of a credible desktop report. I usually use the AI forms for divorces. Is that ok here, I like it because it has conspicuous sections devoted to SOW and intended use/users and allows me to remove and add pages while remaining seamless.

That said, the subject is a 2Bed/1Bath condo owned by the wife of the lawyer's client. Apparently it is rented. The client only wants sales comparison at this point. OK, not necessary to develop income approach. But as far as 2Bed/1Bath w/ similar sq. ft. comparables, is it ok to list all sales for, say, the past 3 or 4 months and do a simple average. Since I have little to no basis for adjustments, it seems to be the most sensible way to give a point value. There are only 5 sales in the project for the last 4 months (3 in Dec, 2 in October) ranging from 175K to 201K (Average 188,800). There are 2 current listings 190K and196K. The 190K was under contract in 99 days, the other has been on the market for 154 days (overpriced). So the Average seems to make sense here. Am I making sense? What say you all.

 

[Terrel L. Shields]

This one seems to have problems written all over it

red flag, warning flag, shot over the bow, you bet.

I would refer this one to some MAI that you dislike.

You is the man, Bobby B

 

[Charlotte Dixon]

but I will very conspicuously note in the intended use, engagagement agreement, and other places in the report, that this is NOT intended for litigation, but only for, like Steve says above "feasiblity of litigation or a starting point for negotiation" in a divorce not for consideration in court and/or for testimony as an expert witness.

What say you all.

I say, get rid of that job quick! Intended User doesn't mean squat when you are subpoenaed to court. When you are served, you must go, and you probably will be served. The judge will not be talking about 'intended user'.

 

[Couch Potato]

If you are going to do such a job, I would recommend having the engagement letter detail an agreement for further work and payment for any additional time, testimony, etc. You can't always stop a judge from requiring you to come to court, but you can guarantee you are compensated for that time (or at least legally entitled to compensation.) I would also look to be able to provide the value as a range rather than a point value. I am taking it for granted that you have the requisite knowledge of the area and data available to do a credible desktop appraisal.

 

[Steve Owen]

There is one aspect of this that does not seem to have been discussed very much (sorry if I missed it... I kind of skimmed the answers). For the most part I agree with the posters who said don't do it... but....

The question was can you do it without an inspection. The answer is "yes" provided you have adequate data. If the intended use is to determine whether your client might want to persue it in court. And, if your client understands that (in writing) and if your client understands the point I'm going to make in the next paragraph. Then, I'd say collect a good fee and go ahead.

One point that doesn't seem to have come up yet is whether an exterior only (or no inspection) appraisal will stand up in court. The odds are pretty good it won't. (Although, no one can predict with certainty what a judge will do.)

Let me tell you a short story. This happened several years ago. A lady I know was getting a divorce in Oklahoma. Her father was an appraiser in Missouri and not licensed or certified in Oklahoma. Neither side had an appraisal done by the usual means. Her father got on the witness stand... disclosed that he was her father, disclosed that he was only licensed in Missouri, and described why he thought the value was $x. (Let's not go into all the reasons he did wrong... I know.)

Her soon-to-be ex-husband put his appraiser on the witness stand. Her attorney asked that appraiser (licensed in Oklahoma and not related to any party) one question: "Did you go into the house?"

The appraiser had to admit that he did not go into the house.

The next words from the judge were as follows: "You are not qualified to testify as to the value of that house."

Food for thought.

 

[CANative]

Intended User doesn't mean squat when you are subpoenaed to court. When you are served, you must go, and you probably will be served. The judge will not be talking about 'intended user'.

One point that doesn't seem to have come up yet is whether an exterior only (or no inspection) appraisal will stand up in court. The odds are pretty good it won't. (Although, no one can predict with certainty what a judge will do.)

It seems that "going to court" with the appraisal was not the intended use. So if the client uses the appraisal for a non-intended use, isn't that the fault of the client, rather than the appraiser?

 

[Steve Owen]

It seems that "going to court" with the appraisal was not the intended use. So if the client uses the appraisal for a non-intended use, isn't that the fault of the client, rather than the appraiser?

That is true. But, that doesn't mean you cannot be supoened (sp... too lazy to look it up). Ozarkian: su-peenied.

However, most judges would probably not allow the testimony if the other attorney objected on that basis (just my guess). One thing to be certain of... if you go to court as a professional witness, be sure you get professional payment. As far as I'm concerned, if that happens, it's all good.

 

[hastalavista]

If the intended use is for litigation feasibility, I don't see any reason why it couldn't be done as a drive-by. The intended use is legitimate and the amount of data may or may not be sufficient for you to conclude credible results.

IMO, it would be possible to complete the assignment with minimal data sources, as long as you customize engagement agreement and the SOW to include the fact that from the start, there is no answer to the value question, and that your client has requested you to get the best answer you can. Yes, there is a point where the data available returns a 'no value', but that's a pretty low threshold.

Assume your subject is a 2br/1ba unit and you know the GLA. How hard is it to research the price range for similar units? Of course, the value is dependent on condition and factors regarding the HOA/project. But at this stage, if the go/no-go point is $400k, and your value range comes back with $375k to $450k, that is very useful information; enough for the attorney to take it to his/her client and make a decision. Likewise, if the value range is $325k to $375k, that information is just as useful.

The client has a simple problem: Do we proceed along this course?
The answer is dependent on the value. The question is, "Does it appear feasible that there is sufficient value to proceed?" This is exactly the kind of problem that appraisers solve.

If one were uncomfortable with this, one could recommend an AVM.

And, if the client is incompetent enough to use this report and require my testimony about it in a case or deposition when they know that is not the intended use, then I can say to the opposing counsel when asked,
"My report was not intended for this litigation, and isn't credible for the purposes being used in this case. My client and I discussed this before I accepted the engagement, it is clearly stated though out my report, and I again reminded my client of this fact prior to my testimony."


So, again, I see little (or, very manageable) risk as long as the engagement and SOW are clearly written, the purpose/intended use of the results is clearly established, and the reliability of the results are clearly understood.