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Former Appraisals as Comps???????

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Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
:wink: I appraise in a rural area. The area is short on finding comparable’s of new manufacture homes in the 1000 sq. ft. to 1500 sq ft. range on a crawl space. There are a few on full basement and the lenders do not want you to adjust out for the basement. They want the comparable to have a craw space. Hundreds of new ones have gone up in the past five years. I am getting some of these for refinance appraisal. Is it permitted to use the ones you have just appraised as comparable’s for the new appraisal?
 

Tim Hicks (Texas)

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Texas
NO.

Appraisal 101. You are supposed to use sales that have been exposed to the open market. The only valid sales for any appraisal is sales of any home that has been properly exposed on the open market. Get ready for a long detailed post from Jo Anne.
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
I'll try not to be too long of post--just quote sources!

Read the 1004B or similar document you sign with every report: Statement of Limiting Conditions, Statement 5, Appraiser's Certification Statement #1

Fannie Mae's new guidelines that went into effect June 30, 2002: Section 102.02-Unacceptable Appraisal Practices--Creation of comparable sales by combining vacant land sales with the contract purchase price of a home that has been built or will be built on land. Section 304-FactoryBuilt Housing (entire section)

North Carolina Appraisal Board--"What is a Legitimate Manufactured House Comparable for the URAR" http://www.ncab.state.nc.us/FAQ.htm

South Carolina Board newsletter in thier Fall 1998 and Winter/Spring 2001 newsletters. http://www.llr.state.sc.us/POL/RealEstateA...rs/reanews2.pdf
http://www.llr.state.sc.us/POL/RealEstateA...rs/reanews5.pdf

Alabama Real Estate Appraisers Board http://www.reab.state.al.us/news/manuf_hous.htm

Georgia Real Estate Appraisers Board
http://www2.state.ga.us/grec/greab/greabne...rmanufhsng.html
Texas Appraiser Licensing and Certification Board "Whats New"
http://www.talcb.state.tx.us

http://www.appraisersforum.com/messages/20174.shtml
http://www.appraisersforum.com/messages/19983.shtml

And to make my post even shorter--NO NO NO NO NO

And be prepared for the value to be way under the original costs--those costs propbably included payoff of credit cards, purchase of vehcile rolled in, disquised no down payment, false value for the trade in, etc, etc, etc.
 

Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Thanks Jo Ann and Tim. :oops:

Some of your links did not open. However I fully understand. Next question. Can I mix and match the comparable’s that I have used on the other appraisals. I have used these in the past couple of weeks that have been on the market? These are with in a 25 mile circle of one another.

Another problem I am having in the area is half of the local realtor’s are not members of the Board of Realtor’s, State Board and/or don’t belong to the any of the three MLS’s that sever the area. This is causing me to go to each of their offices and the court house to pull comparable’s, you all know of any way around this little problem.
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
Your last paragraph describes my area. Almost 60% of the sales in my one county, 90% in the other county are FSBOs. Which means I make lots of phone calls to owners, knock on doors, calls to next door neighbors, family members of a seller or buyer, etc, etc. We are very lucky in Arizona to have Affidavits of Value, a document with the sales price stated that is signed by both the buyer and seller filed with the county recorder with each transfer of ownership. I have to pick up those once a week from the courthouse. I always have to track ads in the weekly newspaper, on bullitin boards at the grocery store, watch for FSBO signs nailed trees and in yards, etc and matche them up to the assessor's records and eventually to an Affidavit. I use the Day One/Nova software, it has a program to save comparables from my reports-which do constantly. I have also created a dummy data report and as I pick up Affidavits, FSBO ads, realtor listings I type info into that data report and save to my data base. I now have six years of computerized info on every residential property in my two counties that was ever offered for sale or sold. I keep all documents in my office in assessor's parcel number order--so some numbers have several affidavits because it has sold several times, FSBO ads, realtor ads, photo of a sign nailed to a tree, for the past six years. With this computerized data base I can search for any property that is comparable to my subject, insert it into a report (including a photo) and away I go. Most of my research is completed at the time a home sells or is offered for sale, so when I write up a report I am just tying up loose ends for the comparables I select.

Now to the first paragrpah--I am a little confused. If a property sells, you can use it as a comparable for every subject property you appraise from then on that is very similar. So if your questions is that can you reuse comparables-yes. And you might have comparables previously used from many different former reports but in a different sequence. Just be sure they are arms length transaction as stated in the definition of market value at the top of the Limiting Conditions page. And although the first three comparables should be closed sales, the remaining comparables in a report can be active, pending, expired, withdrawn--whatever will give a picture of the activity for that specific type of property in the market. If there are three homes on the market just like the subject for $50,000---the appraised value of the subject would not be $60,000, no matter what the closed sales indicated!

Sorry about some of the urls not working, I probably made a typing mistake. But access those appraisal boards for that state, do a search for manufactured housing and the right link will pop up.
 

Stone

Elite Member
Joined
Feb 1, 2002
Professional Status
Certified General Appraiser
State
Wisconsin
Hi Ray. I have done some work in your area, though not mortgage work. Finding info on improved tracts is a major issue in the western part of the state. I would recommend cntacting other appraisers in your market and see how they get info. I have had appraisers send me comps, but I don't do that many improved properties, and I am not competing for their business. When I do get contracts for improved properties in your area, I charge more for the time and effort it will take to locate comps.

I have stopped at properties that I know sold and asked to measure the houses and ask about the interior finish (bedrooms, bathrooms, etc), with pretty good results. I don't think that is practical for mortgage work money, but it works as a last ditch means to gaining info. I would suggest you be careful as to which properties you take this approach, however. There are many properties that I would not be excited about knocking on the door. Since you live in the area, I am sure that you are well equiped to choose appropriately.

Back to the original point, make as many contacts as you can, both appraisers and realtors, and be sure to pass along info to anyone who does the same for you. Few people will give you info without gaining some benefit. Be prepared to make a lot of phone calls to realtors and homeowners to verify information that is incomplete. Good luck.
 
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