Here Is Why FHA Fees Go Up $150

[Meandering]

I won't do any of this in a vacant home. I want the owner of the agent there to turn on the appliances and run them. I'll watch, because the first time you turn on something that doesn't work right, you broke it.

The same goes for attic spaces. They open it, They close it. I'm not answering to questions about rearranging the insulation.

Ditto crawl space access points, they open it, they close it. I'm not fighting with rusty hinges and debris piles in front of crawl space doors.

Ever see a microwave shoot sparks when they go bad? pretty scary stuff.

Ever see a dishwasher leak all over the floor while it's full of water? I'm not cleaning it up.

Ever turn on a baseboard heater and smell melting crayons?

yeah, want to hear about the curtain or bedspread that started to melt because it was sitting on the baseboard heater?

Ever see a house with aluminum wiring that the light switches melted and don't move?

Not touching anything I did not bring through the door with me.


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[GWISC]

I'm starting to have a change of heart in FHA fees. Not because of the inspection requirements... those are trivial and have not changed much.

But the new handbook is directing us to do all three approaches. I'm fine with the cost approach and not charging more. I almost always do that anyway. But now they want the Income Approach for SFRs. That means a lot of research and a rent survey for SFRs in all cases. This is a lot of work that is not NECESSARY in the USPAP sense of the word.



So, $500 for the basic appraisal. $100 (at least for the rent survey) and another $150 for the research necessary to identify, collect, analyze and reconcile.

$750 minimum. There is going to be a lot of howling.

Those SF rent schedules can take longer than the sales comparison approach. Spending time finding tenant occupieds and seeing if the broker knows the rent can be time consuming. I would try and get a whole lot more than $100. A single family with a rent schedule could take more time than doing the rent schedule for a 2 unit.

 

[Elliott]

Ever open a electrical distribution panel only to have it spark and shoot across the room. Then you figure out some moron-lunkhead used a bent nail to make a hinge, which of course touched the main hot circuit when you open it? Thank god for wearing Nike.

 

[CANative]

Maybe I'm just misunderstanding section (a). But, my interpretation is it only applies if the subject has a rental history. Plus, we have the additional ambiguity of the use of the word "should" instead of "must". Again, maybe I'm wrong.

Nope. The income approach should be completed for SFRs. It doesn't exclude properties that have a rental history. The qualifier is "when there is evidence of recently rented and then sold data pairs."

There is always an SFR that was rented, sold, and then re-rented or the tenant stayed. In any case it appears the appraiser must search for this evidence. That right there is a significant amount of time added to the process. If we just casually say there is no evidence it's likely we would be subject to criticism if a reviewer actually found the information. How we would explain our rationale not to do the IA?

The IA for SFRs is VERY time consuming especially if we have to work diverse markets in order to get a fair share of work.

 

[glenn walker]

I am going to be very busy with FHA because I have been doing H & S inspections, Crawl Spaces, Peeling paint and operating the mechanical equipment for 25 years . NOTHING has really changed except maybe doing the income approach BUT even that's fairly easy in my market and my friend owns a large property management company and has rentals in almost every city I work in. At most the income approach will add 10-30 minutes but in upper income areas we have very few single family rentals so it won't be required anyway. I will be happy to raise my fee BUT so far nobody seems willing to pay anymore and we have hundreds of appraisers in my market who take the orders.

 

[GWISC]

The income approach could be considered misleading if you do not have enough SF rentals which became sales for a reliable GRM. I guess I would have to make a comment that the approach is required, but is not that reliable given the lack of data. In our market, SF houses are purchased for use and not income except in very few cases. In many cases, the listing agent does not know what the rent was prior to being sold.

 

[EddieB]

I am going to be very busy with FHA because I have been doing H & S inspections, Crawl Spaces, Peeling paint and operating the mechanical equipment for 25 years

You're correct that little has changed with the inspection protocol but a head and shoulders inspection is not adequate in most cases.

 

[BIGSKIPPER]

I have decided that FHA is not going to be something I do anymore because I believe soon AMC's are going to want multiple pictures of all areas of the crawl space and attic. And I am not crawling into an attic with 30 to 40 inches of insulation. Nor am I going to crawl around in a crawl space that is 18 inches and on dirt. I'm 60. I don't need it anymore. I say if FHA wants a building inspection then get a building inspector. And besides that I know of many scuttle doors that are so hard to get into that I can't even do a head and shoulders. That's because they put 40 inches of insulation over the scuttle. So FHA can take a hike. I think their scope is idiotic and I'm not doing it anymore.

I appraise in Florida. I can name at least 4 poisonous snakes and two poisonous spiders. For that reason alone I don't think it is safe to be crawling around in crawl spaces. As for attics, I don't see me balancing on the edge of a 2" X 4" which is actually 1 5/8". There are very few attics with decking.

 

[CANative]

I appraise in Florida. I can name at least 4 poisonous snakes and two poisonous spiders. For that reason alone I don't think it is safe to be crawling around in crawl spaces. As for attics, I don't see me balancing on the edge of a 2" X 4" which is actually 1 5/8". There are very few attics with decking.

HUD does not expect this.

 

[Deleted member 128537]

Those SF rent schedules can take longer than the sales comparison approach. Spending time finding tenant occupieds and seeing if the broker knows the rent can be time consuming. I would try and get a whole lot more than $100. A single family with a rent schedule could take more time than doing the rent schedule for a 2 unit.

Most of the investment properties in my area are vacation rentals by owner on a daily or weekly basis. So there is no real tenant to even talk to. The problem in my market is that you make more money doing seasonal rentals than month to month. And most of the time the owner lives outside the area. And then not all owners rent all the time. So it's a mess. I don't even mess with them. I could spend a week doing a SFR rent schedule. Not worth it. So if FHA required it I would have to charge $2,000 for one appraisal.