Class Appraisal Absurd Revision Requests

[DWiley]

But with the GSE's insistence on 6 months, 1 mile.....

Citation for support of that assertion?

 

[CGinMN]

White collar is not a term I would ever use.

Even what it attempts to describe is inaccurate. Blue collar is the new white collar.

 

[George Hatch]

The problems come in when some of your comps by necessity are in B and some are in 213. When GLA, condition, quality, age, etc are nearly identical, but there are nonetheless market value differences, we are supposed to be able to explain why, and yes sometimes this can in the same area, a couple blocks away. I have seen a small area taken over by investors/renters. That impact is real. But the list of items/reasons/causes that we are NOT supposed to mention as possible reasons is growing. I saw one where even saying a home was close to amenities and services was considered a no no. Come on!

The differences would go into the location or view line. What words are left to describe the differences? And before anyone brings up the point, yes we should always stay as close to the subject neighborhood as possible. But with the GSE's insistence on 6 months, 1 mile, etc, sometimes that is not possible. I've done mostly semi-rural appraising in my career. Those 1000-home neighborhoods with 50 sales to choose from are quite foreign to me.

The line between "don't use this long list of words" and appraisers not being able to accurate reflect why there are market value differences is blurring. We can blindly sit back and let it happen, leave the profession, or put up some kind of common sense resistance.

We are being redlined into a small corner where we will only 'be allowed' to use words which in no way could impact the larger societal causes of those in charge. Of course that is mostly moot as well, because I still hold firmly to the notion that only 20% of res. appraisers from 2022 or so will still be around in 3 years. Watch as appraiser narrative falls largely by the wayside with the new forms. Most of the report will end up (after a couple iterations) being nothing but checkboxes. The next wave of higher demand for our services which cause delays will only accelerate the calls for our immediate relegation to the scrap heap of icebox and buggy whip salesman.

If it's about the location then citing the market data is self evident. If it's about the condition then the data speaks to that, too. I've never been asked to explain the why beyond that. It doesn't even matter to my analysis what the reason is for that - it simply "is". This location has been selling for more than that location. This condition is selling for more than that condition. That's a factual observation all by itself.

I sure as heck don't want to be saying anything (good or bad) about anybody in an appraisal. Besides, people move.

I don't understand what you guys think our exposure is WRT omitting comments about the actions or expectations or socio-economics of the residents in these areas. You're not lying-by-omission about the property attributes or HOW the buyers and sellers are reacting to these attributes. And you're also not feeding the critics with any unforced errors.

What do you think would happen in an appraisal in Marin City if I started running my mouth about even the differences in median household income between that pocket vs the neighborhoods within the incorporated city of Sausolito to the s/e and on the bay side of that freeway? And to what end would I even mention it? Is there some income multiplier I can extract from the sales data to support my location adjustment or can I simply show the difference in pricing via reasonably similar comparisons on the price?

When was the last time any client dinged an appraiser for not commenting on the occupations or the level of litter or cars parked on lawns or Christmas light traditions or orientation to the nearest Buddhist Temple in a neighborhood? This "free-speech" solution amounts to a fix for a problem that doesn't exist for appraisers.

These users are the ones with the deep pockets and regulatory exposure which occurs as a result of some appraiser talking about the percentage of intact 2-parent families in the neighborhood. Their compliance with the law and their exposure to getting sued for discrimination is a legitimate factor for them to fret. Heck no, they aren't required to take on any unnecessary risks because some appraiser thinks they need to know about the gang related art on the south side of the garage backing to that alley (cost to cure for which is <$500 anyway).

 

[George Hatch]

You wouldn't catch this guy waxing poetic about how special this neighborhood is. If he was an appraiser he'd go to the data. After he smoked a Pall Mall, of course.

 

[sputnam]

The last several reports I've submitted to them have come back with the most absurd revision request. It's almost like they want a narrative report while paying for a summary. I am about to stop accepting assignments from them. Anyone else having this issue with them or other AMC's?

It's likely not the AMC that's the problem there. It's more likely they have a Lender/Client (or several) that is difficult or extra picky about some items. However, it is always true, per USPAP, that we must support our conclusions and opinions. Depending on the type of report required, that usually means we have to at least summarize the data we used, the sources of the data, the type of analysis that was done, and some sort of rationale for our conclusion. I can't comment no your reporting since I haven't seen any of them.... but, I can tell you that I see reports that need revision almost everyday.

 

[Cob]

Never had any issue with class, some of the more absured requests have come from solidifi, but i sincerely caution you to NEVER appraise for Financial Asset Services Inc. They 1st asked one of my appraisers for their workfile, which they have not authority to do so. They then asked him for a laundry list of revisions, regading adjustments, where and how they were derived from, and specific paired sales analysis results. He was currently at a friends funeral yet they continued to push, at which point he withdrew from the assingment. They then reported him to the board. Total garbage company that are not appraiser friendly and will not hesitate to throw you in the fir

Take the CL out of Class and what are you left with?

OR add "less" to the end of their name......

 

[mp2277]

I found this in another thread

The Appraising Residential Properties, 4th Edition, Appraisal Institute, "Other Quantitative Adjustment Techniques”, Page
344 further states: “…In instances where paired sales analysis is not conclusive, the appraiser may apply judgment to resolve
the problem." The adjustments resulting from the appraiser's judgment is based on a study and understanding of historic or past
buyer preferences. It further suggests that cost and depreciated cost data may be used with the appraiser arriving at the value
contribution (not cost new) of certain features. The process of supporting the contribution of individual variables (features) is
limited and often difficult to quantify, with adjustment deemed to be qualitatively supported unless otherwise addressed. All
methods of supporting adjustments are usually limited by inherent uncertainties within the applications themselves.

Adjustments, in this report, are based on a combination of Paired Analysis with Sensitivity and/or Trend Analysis & on a study
and understanding of historic or past buyer preferences. Support for adjustments may be based on multiple applications and
rarely do two methods return identical results with a high degree of accuracy. While not always 'strongly' independently
supported, collectively, the adjustments serve to narrow the adjusted value range of the comparables in support of the subject's
'most probable selling price' commensurate with the definition of Market Value set forth herein.

 

[TerryRohrer]

I found this in another thread

The Appraising Residential Properties, 4th Edition, Appraisal Institute, "Other Quantitative Adjustment Techniques”, Page
344 further states: “…In instances where paired sales analysis is not conclusive, the appraiser may apply judgment to resolve
the problem." The adjustments resulting from the appraiser's judgment is based on a study and understanding of historic or past
buyer preferences. It further suggests that cost and depreciated cost data may be used with the appraiser arriving at the value
contribution (not cost new) of certain features. The process of supporting the contribution of individual variables (features) is
limited and often difficult to quantify, with adjustment deemed to be qualitatively supported unless otherwise addressed. All
methods of supporting adjustments are usually limited by inherent uncertainties within the applications themselves.

Adjustments, in this report, are based on a combination of Paired Analysis with Sensitivity and/or Trend Analysis & on a study
and understanding of historic or past buyer preferences. Support for adjustments may be based on multiple applications and
rarely do two methods return identical results with a high degree of accuracy. While not always 'strongly' independently
supported, collectively, the adjustments serve to narrow the adjusted value range of the comparables in support of the subject's
'most probable selling price' commensurate with the definition of Market Value set forth herein.

I think the cold, hard reality is that the market for appraisal services will separate into two primary markets...one meeting demands for lending functions, relying wholly on individuals who are content to push a button and apply results from a software designed and programmed by others without having a clue how the software works or the fundamentals behind it or the veracity of the results, with results likely equivalent or inferior to AVM results...and another meeting demands of parties needing truthful, supported, well reasoned valuations that can stand and be defended under significant scrutiny, served by appraisers.

 

[shrubberyvaluation]

I’ve done thousands of appraisals and I’ve never used the words -white collar, blue collar, house of worship, church etc. in any of them. Sometimes less is more. I did mention unemployment rate for a few years during the crash, but that was it.

I've used Church, as it was a boundary road for the neighborhood. No getting around it unless I lie.

 

[Carnivore]

Citation for support of that assertion? He cant cite the source.

carnivore; there isn't one.

The below is wrong

The differences would go into the location or view line. What words are left to describe the differences? And before anyone brings up the point, yes we should always stay as close to the subject neighborhood as possible. But with the GSE's insistence on 6 months, 1 mile, etc, sometimes that is not possible. I've done mostly semi-rural appraising in my career. Those..
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Carnivore's response Those constructs of 6 months and one mile disappeared a long time ago. Some others for commenting about 10%+ line items adjustment and 25% gross adjustment comments disappeared also. Last I knew they do want explanations below is what FNMA wants to see and or comments, You will notice that they do not limit or tie the hands of appraisers. I use the selling guide all the time. Lot's of appraisers over at facebook rarely use it...they just want a quick answer. They do get quick answers but those who answer did not know themselves so they are spreading disinformation. Some do it purposely
my reply to them would be below

B4-1.3-08, Comparable Sales (11/06/2024)

This topic contains information on selection of comparable sales, including:

selling-guide.fanniemae.com