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FHA New Construction & 1007

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Robert L. Ripp SRA

Thread Starter
Freshman Member
Joined
Oct 11, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
Does FHA still require the Marshall & Swift 1007 on an existing new home? The handbook protocol does not indicate it is still required.
 

Ben Vukicevich SRA

Senior Member
Joined
Feb 9, 2002
Professional Status
Certified General Appraiser
State
New Jersey
Robert,

Check the handbook, Page 4-8. All the info you need is there regarding Marshall and Swift. You don't need to include the pages from the Cost Manual anymore with the cost figures circled because that is a violation of Marshall's copyrighted material, I believe. You just have to state the pages in the manual where you obtained the figures.

Also, in order not to support a "monopoly," you can use any national cost service for the Cost Approach..as long as you fill out their form.. I verified that once with REAC. But who knows, if you have Marshall Swift, fill out the 1007, state the cost pages on it and let it go.

Don't forget to add the marketing expense to the final figure calculated by Marshall Swift. I use 6% out here. And don't forget to do it the approved AI way by using the reciprocal..don't multiply it by 1.06...that's not the AI way...divide by .94 to get the true 6% marketing expense tacked onto the final MS Cost Approach value... :lol: :lol:

EG: MS Cost $75,000+ Site $25,000=$100,000/.94=$106,383. That $383 really makes a big difference...... :roll: :roll:

Ben
 
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