Here's another interesting condition from that Big Dog Bank

[Delta85]

Assuming you actually have market support for an adjustment, your explanation doesn't have to be complicated. For example, 'Location adjustments were based on differences in the average per square foot sales prices between the subject and comparable subdivisions'. As already stated, if it's a SWAG adjustment, just say that it's based on your professional experience and judgement.

That does not sound like what the OP is describing. What the OP describes is a very detailed layout of the adjustment, or lack of adjustment, including the pathway and mechanics of the final number.

 

[BRCJR]

......................................... As already stated, if it's a SWAG adjustment, just say that it's based on your professional experience and judgement.

Some states, if called upon to defend an appraisal, will not allow such a statement to pass for support.

 

[Mike Kennedy]

CAN

USPAP States ...
2-2b(viii) summarize the information analyzed, the appraisal methods and techniques employed, and the reasoning that supports the analyses, opinions, and conclusions; exclusion of the sales comparison approach, cost approach, or income approach must be explained;

Comment: A Summary Appraisal Report must include sufficient information to indicate that the appraiser complied with the requirements of STANDARD 1. The amount of detail required will vary with the significance of the information to the appraisal. The appraiser must provide sufficient information to enable the client and intended users to understand the rationale for the opinions and conclusions, including reconciliation of the data and approaches, in accordance with Standards Rule 1-6.

Therefore , the bank and Kevco is correct. If your not explaining then your not producing a credible report."

I agree.

A Summary analysis which may be acceptable to, and sufficient, for knowledgeable Lender/Clients is likely insufficient for "intended users" OR others who "may rely" upon an appraisal report.

Despite the USPAP identification of named "intended users", since the GSEs revised their form Certifications 21 and 23 AND Doof-Thunk 2010, anyone who may get his/her hands on an appraisal report, including typically unsophisticated parties (re appraisal terminology) considers themselves "intended users" - including borrowers who must receive a copy from the Lender.

IMO, the demand for "specific" support for each and every line item vs a summarized analysis is not required by the GSES or the USPAP in a Summary Report and represents an assignment condition which must be accepted and dealt with accordingly or an order must be declined.

 

[Mike Kennedy]

Read A/O-11 lines 88-93. and 140-146

AO-11 SUMMARY REPORT
viii. summarize the information analyzed, the
appraisal methods and techniques employed,
and the reasoning that supports the analyses,
opinions, and conclusions; exclusion of the
sales comparison approach, cost approach, or
income approach must be explained;

ALSO

Varying Depth and Detail Within the Report Option Selected
152 Standard Rules 2-2(a)(viii) and 8-2(a)(viii) and 2-2(b)(viii) and 8-2(b)(viii) use the words “describe” and
153 “summarize,” respectively, as the distinguishing verb, but they contain the identical Comment that each item
154 must be addressed in the depth and detail required by its significance to the appraisal. The overall depth and
155 detail of information presented to satisfy each Standards Rule, not the length of any specific item, determine the
156 proper application of the report option utilized.

 

[BRCJR]

I agree you do not need to include the "support" for everything in the report in the report.

You are charged with having that support in your workfile.

Do you believe your appraiser/appraisal knowledge and experience is proper support for an adjustment?

 

[Mike Garrett RAA]

Come on guys...lets get real. That kind of detail is not typically required by most knowledgeable intended users. To explain every adjustment is unnecessary and well beyond a normal scope of work.

I find it interesting that we see this kind of thing mostly from newer appraisers. The other day I was in a meeting with 5 appraisers. Two of them suggested four or more comparable sales were necessary along with one or two active listings. In the very next breath both complained about low fees and how over worked they are.

Why do you suppose the 1004 residential appraisal report form has three (3) sales on the grid? Are three sales, in fact, sufficient for a credible appraisal? Is a report that does not explain each and every adjustment misleading? As usual...it depends.

 

[Riick]

Why do you suppose the 1004 residential appraisal report form has three
sales on the grid? Are three sales, in fact, sufficient for a credible appraisal?

Anyone in the business for a few years knows that frequently you need
--and hopefully have--
one good comparable "to hang your hat on".
At those times, Comparable #2 through Comparable #9999 are just window dressing.