Data Cancer found....

[Joe Flacco]

Even if it is worth $430k, that is a situation that we would expect to not be offered a waiver. It is questionable decision making by the algorithm.

I didn't watch the whole video. Did he specify the neighborhood or properties? How did you find that?

 

[George Hatch]

And if anyone is still following this property....

The County shows a $300k mortgage for this transaction. The public records also show a prior sale in 09/2021 for $350k. So that 2021 prior purchase was already higher than many of the 2024 sales in that neighborhood.

 

[George Hatch]

Even if it is worth $430k, that is a situation that we would expect to not be offered a waiver. It is questionable decision making by the algorithm.

I didn't watch the whole video. Did he specify the neighborhood or properties? How did you find that?

He included dates of sale and sale prices. From there it was easy. My quick-n-dirty returned 2 choices in the first 3 minutes and this was the first one I picked. The other sales nearby checked out for dates and prices.

If the loan is for $300k and the list was $410k and there was a 2021 sale for $350k and there were multiple offers in this transaction to get to $430k the use of a waiver might be bad news for the data cancer fans but it's a no-brainer for a lender. Even at Phil's $390k, a $300k mortgage only amounts to a 77% LTV. Depending on the borrower and whatever other factors go into their decision making, a 77% LTV is all the closer a lender needs to get in order to do what they do.

 

[Joe Flacco]

It looks like it sold for what it is supposed to. If anything it seems like the $360k on 05/29/2024 sold for more than it should.

 

[Joe Flacco]

The $430k doesn't seem like it sold for more than the 2022 or 2023 sales on the lake after adjustment for the size of the house. But the $360k sold for 20% more than the same model compared to 2023.

 

[George Hatch]

I dunno about the $430k. It seems to me that the list price at $410k might have made more sense when compared to the slightly larger non-view property that sold for $397k. Then again, maybe that view in that neighborhood is worth $30k or $40k. Hard to say without looking at a lot more data, starting with the sales histories of every home that backs to that lake.

But there were apparently multiple offers and the one that got the sale was the buyer who had $130k of their own cash to put into the deal.

This is a view property. Nobody should even be using this transaction in appraising the non-view properties unless they're stuck and have no other alternatives. Not to mention the point that appraisers routinely toss the outliers.

Now I get the point that from the appraisers' perspective price-creep in the data becomes a problem for them. But the lender is getting valuations (appraisals or otherwise) for the purpose of making a reasonable loan; they're not getting appraisals for the purpose of regulating pricing in the market. Nor is price-suppression or equity protection the role of appraisers.

I think that if appraisers are worried about price creep from waivers hurting the market participants then the target demographic for that argument is the buyers. "Now is a great time to get an appraisal to avoid paying too much. Trust your local appraiser because they're the experts. "

 

[Joe Flacco]

It seems like the size of the house is wrong for the $430k is wrong. It looks like the exact same house as the one that sold for $380k in 2022. The 2900 SF on Zillow probably includes the basement.

 

[George Hatch]

It looks that way. All the more reason why the original list might better fit the trends demonstrated by the other sales nearby.

 

[George Hatch]

The $397k sale at the east side of the neighborhood shows similar: 2400sf +775sf finished basement

 

[Joe Flacco]

We have too much time on our hands.