Cost to cure adjustment on the grid?

[glenn walker]

If you put a hard cost to cure in the adjustment grid and made no adjustment then I would ask why? If you put a "hard cost to cure" in the adjustment grid and adjusted for it $ for $ you must must have BS'ed all your clients into thinking that you were doing your job properly. If a bunch of appraisers on the Appraisers Forum can't agree on the proper methodology to handle that how is your client to know? But you (especially you) are supposed to.

You could ask anything you want and my awns er woudl be because I can and I am not a purest who allows technicality's to get in my way. Like I said put it anywhere you feel like it .

 

[Mike Ault]

but if it does he can do it as an addendum .Its not a big deal -- JUST DO IT AND BE DONE.

Sayeth the pitbull.

 

[alebrewer]

Cost related adjustments are common in many reports I've seen over the years. I don't see them as particularly accurate, but I know appraisers yet that apply depreciation to fireplace adjustments by using the M & S "cost" of a fireplace...pool...outbuilding. OTOH...

When I try to extract a fireplace in a regression, I may get a reasonable answer but normally it gets either a ridiculous answer or the R square goes to pot. Boot it out and the R square is much higher. Or in this example, it was pretty reliable - ended up $5,480 for an adjustment for fireplace. I don't see a need for using cost for a fireplace, brick v siding (kind of a quality issue) garages, etc.
View attachment 59307

That was kind of my point yesterday when you raised the concern about doing paired sales analysis - the adjustment extracted could be attributable to something other than the bathroom. Same using regression. Based on the residual, as well as the estimated p value/t stat for a particular regressor, the same could be said of regression - that the reported value of the particular item being regressed could be the result of something besides that regressor (bathroom in my scenario).

FTR - I don't think I've ever had an R2 or adjusted R2 that high when modeling real property. I worked in a pretty heterogenous area, though.

 

[glenn walker]

So you pull a number out your Azz because you THINK (but cannot prove except by speculation) there ought to be some adjustment for the imaginary risk? And EI? for what? Repair men charge what they charge. The cost books include typical costs and labor. EI applies to the first sale of a property...there is no profit to the builder rather it is a repair of a curable functional obsolescence.

Especially in this market...anyone who has already lost 2 or 3 homes by being outbid will jump on it.

Eaxctly my Bathroom cost $10,000 to put back together a hard cost backed up by estimates -cost books etc BUT no Jake The jerk who couldn't extract an adjustment from the market pretends to find a comp with a jacked up bathroom. To many fools reading too many how to make unsupported adjustments .

 

[Terrel L. Shields]

But you (especially you) are supposed to.

Show me the book - in the book - any textbook.
My copy of TARE is old but says nothing about EI associated with a Cost to Cure.

Taking some number completely pulled out of the air with only the feeblest of qualitative support is a dart board not "support."

 

[Mike Ault]

To many fools reading too many how to make unsupported adjustments .

No different than what you are supposed to be telling irate homeowners unhappy with their refinance appraisals who point out that their insurance company says it's worth 30% more than what you just appraised it for. "Cost does not equal value" I can't believe were having to debate that on this thread.

 

[glenn walker]

Sayeth the pitbull.

Show me the book - in the book - any textbook.
My copy of TARE is old but says nothing about EI associated with a Cost to Cure.

Taking some number completely pulled out of the air with only the feeblest of qualitative support is a dart board not "support."

He cant and is just talking smack

 

[alebrewer]

Taking some number completely pulled out of the air with only the feeblest of qualitative support is a dart board not "support."

BUT - as long as we call it a CTC, it's perfectly acceptable to perform the above action...

 

[glenn walker]

No different than what you are supposed to be telling irate homeowners unhappy with their refinance appraisals who point out that their insurance company says it's worth 30% more than what you just appraised it for. "Cost does not equal value" I can't believe were having to debate that on this thread.

because a request for a cost to cure is just that its not a request for value now get back into your Insurrection thread so I can beat you up some more in there as I have my Russian Uniform on and am ready to rumble.

 

[Terrel L. Shields]

I worked in a pretty heterogenous area, though.

I think this one is from an older subdivision but was all built by the same developer. Varied in size etc and not really cookie cutters, but all similar construction and carpenters. That builder just died a year or so ago, and his brother died only a couple weeks ago, both in their 90s.