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Cost Approach

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Hilary Klein

Thread Starter
Freshman Member
Joined
Jul 22, 2003
Professional Status
Certified Residential Appraiser
State
California
I have not done the cost approach for some time, as you know they changed it. We must report the quality rating. I am not able to access this data at the moment. Does someone know the typical quality rating of a 1950's tract home, very plain, nothing fancy, 3 bed 2 bath 1500 sq ft., 1 car garage, stucco, comp. shingle roof, located in Los Angeles (Westchester). I appreciate any help.
 

stefan olafson

Senior Member
Joined
Apr 2, 2003
Professional Status
Certified General Appraiser
State
North Dakota
You can access Marshall Swift - Swift Estimator on line and complete the cost approach for under $10.00. You have to include a quality rating and your numbers must be verifiable, you just can't pull them out of thin air. You also have to include information on where you derived the value of the site from.

It's not just make it up an it's okay, anymore!
 

bill lewis

Sophomore Member
Joined
Dec 16, 2003
Professional Status
Certified Residential Appraiser
State
Nevada
Do you have a Marshall & Swift Handbook?? If not you can go to your local Assessor's website and they will have a quality rating usually listed with the property info.
 

Karl

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Arizona
You can access Marshall Swift - Swift Estimator on line and complete the cost approach for under $10.00. You have to include a quality rating and your numbers must be verifiable, you just can't pull them out of thin air. You also have to include information on where you derived the value of the site from.

It's not just make it up an it's okay, anymore!

WHAT!! You mean it was Okay to make it up before?? Never Mind I was told to usae the "Back Into It" method.
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Retired Appraiser
State
California
The CA for a 1950's tract house in a long ago built out neighborhood in an urban county such as LA has very limited reliability, meaning or applicability in a typical residential mortgage appraisal assignment. If the appraiser can't figure out the quality simply because he/she does not have access to a published cost manual then how can he/she expect to figure out depreciation, effective age, etc, etc. Not to mention a supported and documented opinion of a site value lacking any sales for god knows how many years.

as you know they changed it.

Who are "they" and what was "changed?"

You could just go to www.building-cost.net and fill in the self-explanatory sections and come up with RCN. Takes about 2 minutes. The quality rating descriptions are available as a link in that section. And it's free.
 

Hilary Klein

Thread Starter
Freshman Member
Joined
Jul 22, 2003
Professional Status
Certified Residential Appraiser
State
California
"What" did "they" change?

On the 1004 form, 3rd page, where the cost approach is. Cost Approach to Value, the form now asks for "Quality rating from cost service" (ex A, B, C)and "effective date of cost data".
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
Yeah it was great when you could just make stuff up.:new_smile-l:
 
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