Do you adjust listings in the grid?

[TJSum]

You are making my point it seems, showing a listing as a listing, is as of the effective date of the appraisal. Making an adjustment for something that may or may not happen in the future is going beyond the effective date. This listing could be reduced several more times before it sells or it might not sell at all. From what I see most of the time, the LP/SP ratio has more to do with how much closing help the buyers are getting than anything else.

 

[KD247]

...Making an adjustment for something that may or may not happen in the future is going beyond the effective date. ...

Right. I think the problem arises when appraisers don't really think the situation through. Many tend to think of a listing as another comparable sale and then want to make adjustments reflecting the fact that it hasn't actually sold yet. This poor logic leads to a faulty analysis. If we're going to estimate what a listing "ought" to sell for, why don't we also take the closed sales and estimate what they "should" have sold for?

The analysis of closed sales should be entirely different than the analysis of listings. Closed sales provide an indication of previous market actions but listings actually influence current market behavior.

Few buyers give completed transactions more than a cursory glance, but almost all buyers carefully compare available properties when making their purchase decisions.

Sales prices show an effect. Asking prices are a cause.

Closed sales show trends and patterns in prior market behavior. Listings are a factor that is actually shaping market behavior at the time of appraisal. Adjusting the asking price of a listing implies that it is being considered only as a future closed sale, and that it's influence on current buyers is not being considered.

 

[ZZGAMAZZ]

I thought I had the answer pat but I recentlly encountered several active listings that are listed at greater than market value (although they reflect the mean listing range) and it appears that one might need to bracket downwards rather than upwards for the comparables' inferior factors.

 

[KD247]

I thought I had the answer pat but I recentlly encountered several active listings that are listed at greater than market value

In this market there will be lots of listings at 2006 prices, last-ditch efforts by sellers who want to walk away without facing foreclosure, maybe even with a small profit.

There are plenty of listings like this around here, most on the market for a long time and most with asking prices that stick out like a sore thumb. These listings don't usually contribute anything to the analysis. They typically set the subject's value ceiling at a point far above any value you would even begin to consider.