Help- 1 year sales history of comparable sale

[Michigan CG]

If I was the intended user and had to wade through extraneous data--being diligent I would devote additional time trying to determine whether the appraiser included it by mistake, or whether details beyond what is needed were purposely included--I would think "pedantic" rather than "thorough."

Anything reported beyond the 36- and 12-month thresholds should include comments concerning the rationale for going beyond what is requested.

Never mind.

 

[VolcanoLvr]

The reason Fannie added the three year and one year reporting requirements to the 3/2005 report forms was to substantiate the evidence of property flipping.

They are not concerned about sales prior to those threshold dates. So IMHO we don't need to fret about them either, or take extra time to report them.

Therefore reporting a sale in "1992" is not germane to the present assignment if that was the year of the last sale closest to the reported sale date. Not reporting irrelevant info does not make our report 'less thorough' but including it may give the impression of pedantry.

 

[Peter LeQuire]

Call me a pedant, I suppose. The 3/1 thresholds are minimum requirements, and in a market (available appraisers) in which minimalism is rampant, there is value in going beyond minimum requirements.

Beyond that, would not a sale that occured 13 or 15 or 18 months prior to the current sale of a comparable be important information to consider in one's analysis? Why is a prior sale of a comparable sale or comparable sales not germane? Perhaps it might just lend some aura of thoroughness to the appraiser's work. Perhaps it might support an assertion about value trends. Why would an appraiser strive to provide only the minimum amount of information and/or analysis s/he can get by with in an environment that is demanding more of both?

We have to research and report sales in the 3/1 year windows: I don't see a significant difference between typing "N/A" and typing xx/xx/xxxx, unless there is significance in six keystrokes. The information has been ferreted out and analyzed - why not report it?

 

[VegasWayne]

The 1004 form actually asks for Date of Prior Sale/Transfer not Date of Prior Sale/Transfer if it occurred in the past three years/one year. The instructions on the form do not mention not reporting if the date is over one year. It clearly states "Report the results of the research and analysis of the prior sale or transfer history of the subject property and comparable sales". The check boxes above this part only ask when the prior transfer or sale happened, it doesn't say anything about not reporting if the second check box is checked.

 

[Mike Kennedy]

"Perhaps it might support an assertion about value trends."

Agreed. In this "Bubble Age", three years on both subject & comparables accomplishes both apparent flipping illustration and further supports Market Conditions Trends. In Rural Markets its' often necessary to retro 2-3 years for local comparables as well. What better way to fully demonstrate ACTUAL versus Estimated Value Trends? IMO more than 3 is superfluous and unnecessary on most assignments, although depending on property type and market nuances - more is better than less.

 

[vanguard]

"Report the price of the prior sale(s) or transfer(s) of each comparable for the year prior to the date of the comparable sale."


It is my understanding that if the comparable previously sold within the one year time frame of each consecutive year that it must be reported. That means that if it sold five times within the past five years that each sale must be reported back through the five year interval.

The subject is only reported for the past three years. Reporting requirements for comparable sales may extend farther back than requirements for the subject.

 

[Mike Kennedy]

"Report the price of the prior sale(s) or transfer(s) of each comparable for the year prior to the date of the comparable sale."


It is my understanding that if the comparable previously sold within the one year time frame of each consecutive year that it must be reported. That means that if it sold five times within the past five years that each sale must be reported back through the five year interval."

Nope. The minimums are self-explanatory ( Certs. 5 & 6 on URAR, and USPAP requirement 3 years for subject).

"for the year prior to the date of the comparable sale" i.e. within 1 calendar year retro from the most current reported comp sale. :icon_idea:

The subject is only reported for the past three years. Reporting requirements for comparable sales may extend farther back than requirements for the subject.

Yup but not because the SOW minimum requirement per Fannie demands it - that may be appropriate because an Appraiser believes it to be good appraisal practice (though a property which sold 5 times in 5 years may very likely not necessarily be a reliable, credible, comparable on a current assignment) :icon_idea:

 

[ZZGAMAZZ]

Riick (#10): IMO the user would be concerned/confused if the report included information that isn't requested, similar to leaving a cell blank rather than indicating "N/A."

Providing information that isn't requested--and one must believe that there is a very specific and well-researched reason that the 12- and 36-month thresholds were established, e.g., the flipping history--doesn't heighten the credibility of the report; rather, it tends to heighten the sense of self-importance of the reporter.

If data is provided that exceeds the user's needs, the appraiser would disclose why he or she did so. The inability to explain the rationale for providing unwanted data would preclude its usefulness.

I support disclosure and discourse but don't need to bore the user with information that is not necessary.

Also please refer back to a recent thread when a huge majority of appraisers were unable to cite a single report in which the prior transfer history of the comparables had any sort of bearing on the results or the credibility of the report.

 

[TJSum]

"Perhaps it might support an assertion about value trends."

Agreed. In this "Bubble Age", three years on both subject & comparables accomplishes both apparent flipping illustration and further supports Market Conditions Trends. In Rural Markets its' often necessary to retro 2-3 years for local comparables as well. What better way to fully demonstrate ACTUAL versus Estimated Value Trends? IMO more than 3 is superfluous and unnecessary on most assignments, although depending on property type and market nuances - more is better than less.

Agree 100%. Not only can it support value trends, but it can reveal the "turnover" for any particular market as well. Some markets I work in, each comp can have several transactions within the past five years, and then others, most comps have transactions of 20 years or more ago. It helps to reveal how "stable" the community is besides value trends.

 

[Riick]

If the old transaction is germane to the appraisal, supporting trends in value for example, I say include it.
(( EG: One of the comps sold 3/07 for $128k and most recent sale is $110k,
-or- happier days sold 3/07 for $128 and most recently for $156k ))
If the data is too old to have any bearing on todays value, it's window dressing.
(( EG: Sold in new 1982 for $82k -- meaningless "information". ))

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