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Date of Appraisal/Inspection is 6/1, can I use a comp that sold 6/3?

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appraisalde

Freshman Member
Joined
Dec 7, 2007
Professional Status
Certified Residential Appraiser
State
Delaware
I feel like this is such a dumb question, but I honestly don't know! Property was inspected on 06/01, and the house next door sold on 06/03, so can I use it? It's the same house and I am really hoping to use it along with 2 others on the subject's street. Please advise-thanks!
 

LadybugLover

Junior Member
Joined
Sep 30, 2007
Professional Status
Licensed Appraiser
State
California
I just did on an appraisal I completed last week. I was at the property on a Wed. and the next day a model match in the subject's subdivision recorded. I used it, stating in the report that the sale recorded the day after the effective date of the appraisal. The contract date was prior to my effective date. Seemed to me to be the best support for my value. Heck, if they insist on making us use listings in every report these days, why not use a sale that closed before you get the report written up. Just tell them what you did -

Mary
 

lostinthezone

Sophomore Member
Joined
Mar 2, 2008
Professional Status
Certified Residential Appraiser
State
Maryland
Technically, I don't think you can include it as one of the primary comps but can certainly use it as an "under contract" and a 4th comp. (That's how I would do it....) How much weight you give it is up to you. :) If you want to do an update that would change things.
 

appraisalde

Freshman Member
Joined
Dec 7, 2007
Professional Status
Certified Residential Appraiser
State
Delaware
Can anyone quote a rule about this for me so I know for sure? My local appraisers say they do it, but I want my report to be correct! I really want to use it as one of my main 3 comps IF it's acceptable!
 

OSU Beavers

Elite Member
Joined
Jan 10, 2007
Professional Status
Licensed Appraiser
State
Oregon
The depends on how you define the word "sold". Did it record on 6/3 or did the buyer and seller sign closing papers at the escrow company on 6/3?

As long as you use the same date, COE or recorded, for each and every comp.
 

TJSum

Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
As far as I know, the effective date is the effective date. Things that happen after the effective date are just that. I always put it on the grid as "under contract" and note on the report that it had actually settled prior to the signature date giving the added advantage of knowing the terms of sale (actual selling price and closing help).
As others have said, it is up to you how much weight to give this comp. Rarely are three comps good enough any longer in the current climate anyway...
 

lostinthezone

Sophomore Member
Joined
Mar 2, 2008
Professional Status
Certified Residential Appraiser
State
Maryland
Okay, let me rephrase. No, you can't use it as a primary comp. If you could, where would you draw the line? 3 days, 1 week, 1 month? Note that the sale date in your jurisdiction may not be the same as the recordation date so you may want to call the agent on that property and see when they actually signed the papers. That may have happened before your effective date, but the tax office may have recorded the deed after your effective date.
 

Mike Boyd

Elite Member
Joined
Jan 18, 2002
Professional Status
Retired Appraiser
State
California
Technically, I don't think you can include it as one of the primary comps but can certainly use it as an "under contract" and a 4th comp. (That's how I would do it....) How much weight you give it is up to you. :) If you want to do an update that would change things.

If it closes before your report goes out, then create a comment sheet that it closed on 6/3 and that you have revised your report to give weight to that sale.

I do not quote the EXACT date for that reason. I would have put as date of closing 06/2008 COE. That is the way I was trained by FHA 20+ years ago. No one has ever complained.
 

Joyce Potts

Elite Member
Supporting Member
Joined
Feb 6, 2005
Professional Status
Certified Residential Appraiser
State
Florida
If your lender requires three closed sales--fine. Use it as a 4th and use it to pair with the historic closed sales to see if it supports any kind of market condition change.

If it's for a client that doesn't necessarily require three closed sales, then my answer is yes, if you properly qualify it, i.e., MLS information, conversations with the listing Realtor, etc. That said, I wouldn't hang my hat on any one particular pending or sale without taking into consideration ALL THE MARKET DATA.
 
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