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Ethics ? About Appraising In Your Own Subdivision

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Tater Salad

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Missouri
I've finally decided to refinance my home to lower the rate (maybe even term depending on the payment) and I started thinking....

My subdivision has over 500 homes. The adjacent subdivision has a couple hundred more. They are competitive, and the trends in one usually reflect on the other.

I've always accepted assignments in both, feeling that I knew better than an outsider the good, bad & ugly in my own hood. But now that the sale prices in here will directly affect the outcome of my loan, could there be a perceived conflict in doing purchase $ appraisals in here? I would never intentionally skew a value for my own gain (or for any other reason) but I'm having a moment of over-examination and wondered what everybody does. Do you accept assignments in your own subdivision, or is it too close to home? :unsure:
 

jeff samolinski

Senior Member
Joined
Apr 18, 2003
Don't worry about it. I think you will know in your heart when you are in danger of stretching a value in your neighborhood.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
:rolleyes:

I'll bet you do them without any bias. Don't worry about it. If you start thinking that you could nudge one or two, then stop doing them there. I doubt you will or would do that. You're worrying too much and probably need a vacation.
:D
 

Tater Salad

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Missouri
Wow, I knew that I felt a little paranoid but I guess it was written all over my post :p .

Vacation? Oh, yeah, that thing that other people do to relax. Bad part about it is with a 4 & 6 year-old, even a vacation isn't a vacation :blink: .

Maybe a nice long weekend, with the help of a doting grandma...

Thanks for the input!
 

Greg Brinkley

Freshman Member
Joined
Jun 11, 2003
If every appraisal you have done in the 2 neighborhoods is solid and you haven't stretched the values to hit #'s and you can defend every adjustment you've made, then you should not even worry about it. I know I wouldn't. With that numkber of homes, I'm sure there were good comps available each time. If those comps supported your final valuation, then noone can accuse you of anything! Quit worrying about it.
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Tho only two houses in those developments I would not do if I were you would be your own (although you might end up being too hard on yourself) and your best friends house down the street. All others are fair game.

We have the same situation in my development. About 850 houses on 9300 lots. I turned down a very good friend who has done a lot of remodeling and added a hugh garage. Don't need to get into that with a friend. Let the competition worry about it.

BTW, I did a workup on my own house last February before we refinanced. Then an appraiser who has fair experience in our development from Grayling came up and guess what? I was about $5000 under him in my estimate of value. Guess I was too hard on my own house. Just goes to show you.......
 

Richard J. Glesser

Junior Member
Joined
May 16, 2002
Professional Status
Certified General Appraiser
State
Michigan
Here's what you do.....

Knowing you're going to refinance your home, spend the next 2 months inflating the values of all appraisals within the subdivisions. Then refi your home for far more than it's really worth, take the extra money and go on a much needed vacation.

Seriously, unless the above is true, you have nothing to worry about. :usa:
 

Rich Hahn

Senior Member
Joined
May 2, 2003
Professional Status
General Public
State
Colorado
Appraising in ones own;
hood
town
county
zip code
were does one draw the line?

We dont set the trends we only report them.

I see homes like mine all the time, they are close enough in proximity to be a comp
If I appraise those purchases am I helping my own home's value? perhaps.
Am I being objective, yes.
just doing my job..reporting what I see.

Its like the other thread appraising for a friend.
How do you define a friend? I leave homes all the time and I have new friends from that inspection because we happen to have alot in common. In this business this happens all the time.

Paranoia will kill you in this business
 

Tater Salad

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Missouri
It's funny, the scenarios you've all pointed out are what I was "paranoid" that someone might think. :ph34r:

Is this the result of spending 18/7 in this business for the past year or so? I used to be so normal . . . well, as normal as an appraiser can be :p

Richard--I pulled comps in my hood because I haven't done an appraisal in here in the past 5 or 6 months. I looked at my husband and said, "pull comps now and make sure I'm not crazy!"

These people are nuts! I knew the market was out of control, but this is what convinced me to take the time to torture myself with a refi. I guess we're lucky that we know which lenders to stay away from. Hey, there's another plus to being an appraiser. I seem to forget the good stuff now and again.
 
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