Freddie Mac: Quality & Condition Ratings

[Joe Flacco]

Quality ratings are pretty straight forward for new construction.

For Q2 I look for things like slate roof, copper gutters and downpipes, spray foam insulation, solid wood interior doors with heavy hardware, 10-12" base mouldings, high-end cabinetry and finishes, very high level of craftsmanship.

Q3 would be 2x6 construction, solid core doors, engineered wood floors, hardiplank, architectural shingle roof, mid range Pella, Marvin, Anderson or equivalent windows. Composite deck or stone patio. Minimum upper end of home depot kitchen and bathrooms.

Q4 would be 2x4 construction, hollow core doors, MDF moldings and trim, vinyl siding, basic windows and doors, concrete patio, pressure treated wood deck.

Q5 would be 8' ceiling height, none or very minimal interior molding and trim, no recessed lights and minimal electrical, carpet or laminate floors. Minimum code construction.

It is more complicated with old houses.

 

[Digger88]

Someday I am going to write an article destroying each of the methods - and I don't see any here in this list that don't have serious flaws.

Have at it I use them to keep the checkers/uws/gses quiet who want to see my 'work'

I'll work as long as I can I don't really care about any of this anymore

Questons/comments:
1) why describe improvemets/upgrades on a separat line item at the bottom when those factors are integral to the UAD condition ratings, with condition-based adjustments providing the salient source of adjustments in virtually all of my reports
2) I find it hard to belive that ANY APPRAISER would fail to thoroughly review MLS data; in fact I copy/paste the marketing narrative of every comp into the SCA addendum, rather than to piecemeal together a paraphrased description of the MLS comments--only problem being that the spell-checker as well as the current appropriate-phrase-hall-monitor includes those verbatim comments in the review process.
3) Kinda moot, however, if the current thread that pertains to volume of mortgage assignments is true...

1. I find it easier to use the Q ratings for brick vs siding and make separate condition/upgrade line item adjustments as the C ratings don't encompass what's needed here for me

2. I would have agreed until SmartExchange came around I can see what my peers are not doing. Supposedly new AI is on the way to check all this stuff so if you're not doing it now you should start lol

 

[Digger88]

That's a great addendum source IMO; however, I personally would also include the source reference presuming that the info is copy/pasted...

It's from Synapse the adjustment data pages that proceed this notes the source

 

[J Grant]

Quality ratings are pretty straight forward for new construction.

For Q2 I look for things like slate roof, copper gutters and downpipes, spray foam insulation, solid wood interior doors with heavy hardware, 10-12" base mouldings, high-end cabinetry and finishes, very high level of craftsmanship.

Q3 would be 2x6 construction, solid core doors, engineered wood floors, hardiplank, architectural shingle roof, mid range Pella, Marvin, Anderson or equivalent windows. Composite deck or stone patio. Minimum upper end of home depot kitchen and bathrooms.

Q4 would be 2x4 construction, hollow core doors, MDF moldings and trim, vinyl siding, basic windows and doors, concrete patio, pressure treated wood deck.

Q5 would be 8' ceiling height, none or very minimal interior molding and trim, no recessed lights and minimal electrical, carpet or laminate floors. Minimum code construction.

It is more complicated with old houses.

Imo an appraiser who has trouble with the UAD ratings would still have trouble wrt AV, GD, etc - it is not the labels, it is being able to look at a property and holistically evaluate it for our purpose. We are not builders or engineers so the expectation is not at that level,

Some houses are borderline and then all we can do is apply the most appropriate rating and explain it was borderline and why,

 

[Joe Flacco]

Imo an appraiser who has trouble with the UAD ratings would still have trouble wrt AV, GD, etc - it is not the labels, it is being able to look at a property and holistically evaluate it for our purpose. We are not builders or engineers so the expectation is not at that level,

Some houses are borderline and then all we can do is apply the most appropriate rating and explain it was borderline and why,

I have trouble with uad ratings.

The definitions are not logical for old houses. The best way to do C ratings is based on rough estimate of effective age. And for Q ratings are difficult for older houses due to changes in construction standards and what is perceived as quality over time.

The definitions are only logical for 90's construction or newer.

 

[J Grant]

I have trouble with uad ratings.

The definitions are not logical for old houses. The best way to do C ratings is based on rough estimate of effective age. And for Q ratings are difficult for older houses due to changes in construction standards and what is perceived as quality over time.

The definitions are only logical for 90's construction or newer.

That's your opinion.

Imo the ratings apply to all kinds of homes - a bit more complex in older homes perhaps

 

[RCA]

That's your opinion.

Imo the ratings apply to all kinds of homes - a bit more complex in older homes perhaps

Nothing beats percentage of houses in worse condition of lower quality in a defined neighborhood - provided you know the neighborhood.

Take a good random sample of the sold listings in a neighborhood for the past several years, rank them from worst in whatever trait to best. Then see where the subject best fits in the rankiing and give it a percentage score based on its ranking, where 5 or 50 means 50% of the homes in the neighborhood were lower in the ranking. That can be verified pretty much by anyone. Then base your adjustment on that. The RCA method makes that a cinch - although I suppose there are other ways. You can still give this "universal" C1,C2,C3,C4,... or whatever ranking for the GSEs.