extraordinary assumption

[Wil in Norcal]

I received an assignment to do a 2055 drive by appraisal. The property is situated on 12+ Ac and I could not really see the dwelling since it is located down a very long private drive way. I contacted my client and suggestd that they upgrade the appraisal to a 1004 so I can inspect the property. They sent me an appraisal of the property that is over 3 yrs old and wanted to know if I can use the old appraisal. Well since it was a pdf copy of a black and white scanned report, and the photos were pretty bad, it did not really give me too much additional information. The chief appraiser at the company who sent the assignment stated that I should just use the report, and make the extraordinay assumption that I am basing my conclusions off an old report. I turned the assignment down. Am I being overly critical? Should I have accepted the assignment and proceeeded and just made the appropriate EA's. Any feedback would be appreciated. I am familiar with the area and type of property.

 

[PropertyEconomics]

Properly used EAs are fine. It would have been within your scope of work and you could have easily done the assignment in my opinion. Explain what you do, and do what you explain.
Was there something that made you question the other report? Did you believe the information to be false?

 

[Don Clark]

Properly used EAs are fine. It would have been within your scope of work and you could have easily done the assignment in my opinion. Explain what you do, and do what you explain.
Was there something that made you question the other report? Did you believe the information to be false?

PE,

I have a different take on this. A drive by requires that you view the property from the street. If you cannot see the property I would not rely on a previous appraisal either. It may no longer exist. In the case where it no longer exist it would then become a Hypothetical Appraisal(that which is contrary to what actually exist). I might do it as a desk top but not a drive by.

 

[Mike Boyd]

PE,

I have a different take on this. A drive by requires that you view the property from the street. If you cannot see the property I would not rely on a previous appraisal either. It may no longer exist. In the case where it no longer exist it would then become a Hypothetical Appraisal(that which is contrary to what actually exist). I might do it as a desk top but not a drive by.

I agree with Don. How do you know the septic has not failed, that the well is still producing an adequate supply of potable water? I do not think a drive-by is appropriate for homes on acreage

 

[Wil in Norcal]

thanks for the responses. If I make an EA regarding the subjects size and characteristics, could't I make an EA that assumes that the subject is in similar condition and that all expected maintenance has been performed?
Prop Econ, the appraisal I received was incomplete, they just sent me the subject photos, plat map and first page of the 1004. It was not that I felt that the original appraisal was incomplete, it just seemed like it was comprised of all canned comments, which may work in a subdivision but I found it inadequate for this type of property. I would do all my own work but based on the original report I just was not real confident in the data.
This assignment seemed like the client could have easily pruchased an AVM, but they wanted someone licensed to sign for it. They did not care about the inspection or the condition, why even order the appraisal? I do not think the current owner was aware of the appraisal, but the bank ordered.

 

[PropertyEconomics]

thanks for the responses. If I make an EA regarding the subjects size and characteristics, could't I make an EA that assumes that the subject is in similar condition and that all expected maintenance has been performed?
Prop Econ, the appraisal I received was incomplete, they just sent me the subject photos, plat map and first page of the 1004. It was not that I felt that the original appraisal was incomplete, it just seemed like it was comprised of all canned comments, which may work in a subdivision but I found it inadequate for this type of property. I would do all my own work but based on the original report I just was not real confident in the data.
This assignment seemed like the client could have easily pruchased an AVM, but they wanted someone licensed to sign for it. They did not care about the inspection or the condition, why even order the appraisal? I do not think the current owner was aware of the appraisal, but the bank ordered.

Drive by appraisals have a place in our business ... the question is do you feel comfortable doing them. You can make all the EAs you need to do a credible job. If they are later proven to be false you are off the hook as long as you have employed them properly and made a full disclosure of what they are.

 

[Valuadora]

I'm a USPAP instructor and we were just discussing a similar case in one of my classes. You can make all the assumptions and conditions you want in performing an assignment. But in the end, you still have to end up with a credible appraisal. I think Wil was right to turn down THIS assignment. However, there is a time and place for a drive-by and there might be a better situation later.
Nancy
www.valuadora.com

 

[Louis Pompeo]

I'm also a USPAP Instructor

I disagree with Valuadora.

It is perfectly acceptable in USPAP to do the assignment as the client asked.

As PE said.....it is a scope of work decision reached after communicating with the client.

If the client had called him and asked him to look up the municipal property card, don't inspect the property, and prepare a market value appraisal report - that would have been fine too.

The EA's and the Scope of Work would protect the appraiser.

e.g. "This valuation is based upon collecting property data from the municipal property card. The appraiser has not inspected the property per the clients request. (and then list each and every EA)."

It is also acceptable to do the appraisal based upon the descriptive information provided in the old appraisal - bad pictures or not. Just make sure the old appraisal is referenced in and becomes part of the report.

That is the beauty of USPAP.

 

[Kevin A. Spellman]

I would have gone down the driveway knock on the door, if no one was home, shoot and leave. If someone was home I would introduced myself interview the occupant, then shoot and leave. This is a business decision. I would not rely upon another appraiser’s work, most appraisers do not.

 

[PropertyEconomics]

PE,

I have a different take on this. A drive by requires that you view the property from the street. If you cannot see the property I would not rely on a previous appraisal either. It may no longer exist. In the case where it no longer exist it would then become a Hypothetical Appraisal(that which is contrary to what actually exist). I might do it as a desk top but not a drive by.

Mr. Clark .. could one of the EAs be that the property exists?