Closed Sale After My Inspection Date

[timd354]

Top Poster...a combination of the Nobel Peace Prize, an Academy Award and A Miss Universe Crown all at once...lifetime achievement award lol!

Absolutely and well deserved! lol

 

[J Grant]

Focusing on assignments using closed sales with effective date as date of inspection, does that not become an assignment element? I might accept (grudgingly) a last date of a multi day inspection cited by the appraiser as "The" inspection date. However, making a new trip for the sole purpose of creating an alternate later effective date is a gray area...especially if the second trip is a partial inspection such as just the exterior on an interior and exterior assignment ( imo.)

Ponder this: The statement copied here exists as the valuation value statement on the URAR form:

Based on a complete visual inspection of the interior and exterior areas of the subject property, defined scope of work, statement of assumptions and limiting conditions, and appraiser’s certification, my (our) opinion of the market value, as defined, of the real property that is the subject of this report is $ , as of (X date), which is the date of inspection and the effective date of this appraisal

Some of what is advocated a number of posts would effectively change it the below :

Based on a complete visual inspection made on (X date) of the interior and exterior areas of the subject property, defined scope of work, statement of assumptions and limiting conditions, and appraiser’s certification, my (our) opinion of the market value, as defined, of the real property that is the subject of this report is $ , as of (Y date), which is the signature date and the effective date of this appraisal

 

[residentialguy]

Who said the OMV is on the sig date? Stop putting words in our mouth. The opinion of value was formulated after the effective date for all of us. Well, maybe you formulate your opinion at the ext/int inspection rather than after seeing all the market indicators...I'm speaking for the rest of us.

 

[J Grant]

I wrote what the statement on URAR says, not putting words in anybody';s mouth . The second is to show what you guys are doing if you use data changed after the as of effective date.

Our opinion of value is formed typically after effective , but the opinion is expected to be formed from data that existed as of the effective date .

While the analysis of data may be done after the inspection/effective date, the valuation is retrospective back to the as of the effective date/date of inspection. That's what it says. Why does it say that, if it meant the cut off of data did not occur as of the effective date, since the verbiage states the effective date and inspection date are the same? If the dates are the same, and the subject per the MV definition had an implicit consummation of sale as of a specified date ( specified date linked to the effective date), then by logic , how can sales that occurred after an effective date change a closed price as of that effective date?

 

[residentialguy]

Our opinion of value is formed typically after effective , but the opinion is expected to be formed from data that existed as of the effective date .

The data did exist. It was pending at the effective date but closed prior to forming an opinion. The data was still there ... the closing just made it easier to solidify and confirm that data. Nothing wrong with hindsight in that manner. When forming the opinion it closed on 7/15 and should be reported as closed on 7/15, with an effective date of 7/13. Explain it as that and it is meaningful, beneficial, more accurate and not misleading.

 

[J Grant]

The data did exist. It was pending at the effective date but closed prior to forming an opinion.

Yes , the data did exist as of the effective date, and it existed as a pending sale ! Keep as pending on the grid, analyze in comments if it influenced your opinion that it closed after 07/13 before you signed 07/15. we will forever disagree on it ! Fulfilling an assignment element is what makes a result meaningful . Below from a Fannie selling guide: I dunno, seems to me they mean what was closed and what was offered or what was in contract as of the effective date

"The appraiser’s analysis of a property must take into consideration all factors that have an effect on value. The appraiser must analyze all closed sales, contract sales, and offerings or listings of properties that are the most comparable to the subject property in order to identify any significant differences or elements of comparison that could affect his or her opinion of value for the subject property as of the effective date of the appraisal report"

 

[Mr Rex]

The Fannie form says the effective date is the date of the inspection of the subject, All the BS aside about taking 2-3 days to inspect the subject are just that BS. A pending sale/listing may be the most important and best support for the opinion of value but it was not a closed sale as of the effective date of the appraisal/inspection. As such it is comp 4+. Since 1 comp does not make an appraisal. I don't get why some folks want to turn a black and white issue into a gray issue. It is what it is. The truth will set you free. Why go to gray data unless the black and white doesn't support the same value opinion? Certainly at times the gray slams the door but it is what it is and if not closed prior to the effective date is supplemental support.

 

[djd09]

I don't know why uspsp was mentioned in this conversation. You like assignment conditions , you get assignment conditions. One of those unwritten USPAP standards. And i use the word "standards" loosely.

"which is the date of inspection and the effective date of this appraisal."

 

[residentialguy]

The data did exist. It was pending at the effective date but closed prior to forming an opinion.

Yes , the data did exist as of the effective date, and it existed as a pending sale ! Keep as pending on the grid, analyze in comments if it influenced your opinion that it closed after 07/13 before you signed 07/15. we will forever disagree on it ! Fulfilling an assignment element is what makes a result meaningful . Below from a Fannie selling guide: I dunno, seems to me they mean what was closed and what was offered or what was in contract as of the effective date

"The appraiser’s analysis of a property must take into consideration all factors that have an effect on value. The appraiser must analyze all closed sales, contract sales, and offerings or listings of properties that are the most comparable to the subject property in order to identify any significant differences or elements of comparison that could affect his or her opinion of value for the subject property as of the effective date of the appraisal report"

Yes...it was a pending sale and the closing of it confirmed the meeting of the minds of that legal contract, which is the same market evidence. Yes, the opined value is "as of the effective date of the appraisal report". .. however comp 3 closed prior to my appraisal completion, therefore it is listed as a closed sale that clearly shows that it closed 2 days after the effective date and that closing solidified that "meeting of the mind" evidence, which proves that it is a good indicator of market value.

In short, "as of the effective date" applies the the market value - PERIOD! It does not apply to the means on obtaining market evidence to support that value conclusion.

 

[J Grant]

The as of effective date/same inspection date linked to the MV definition is subject implicit consummated sale and passing of title occurred as of the effective date of X. If the cut off closing is effective date for subject, wouldn't that hold true for the comps? Things occur universally on the same date. The period after effective date is to analyze and report opinion, not to keep adding data changes in the market that happened after the effective/inspection date.

IF the as of effective date as the same date of inspection was not intended to be a cut off point for data activity, why is it identified as the MV opinion ( as defined ) date?

Your school of thought has followers. Appraisal needs a definitive body of scholars who exist to settle questions like this, at least for lending work which has certain assignment elements ..