RCA
Elite Member
- Joined
- Jun 27, 2017
- Professional Status
- Certified General Appraiser
- State
- California
How many of you actually have figured out, i.e. understand, how I adjust comps?
I consider the method very clever, if I don't say so myself, on par with Eratosthenes indirect measurement of the circumference of the earth 2300+/- years ago.
I was discussing this with one of the statisticians over at Salford Systems, and I'm not sure he understands it yet. But, then he is not an appraiser.
The clue is I use statistics to predict the value contribution of the tangibles, subtract if from the actual sale price to get an indirect measure of the intangibles. I do this for maybe 300 recent sales in a neighborhood. I rank the residuals form lowest to highest and give them scores 0.0-10.0 in 0.5 increments reflect the percentage of residuals of lower value, using an Excel macro, then replace the macros with the actual scores (so I can re-sort and they won't change), then create a function that maps the scores to the residuals and thus, all comps in your grid have the adjustments for tangibles based on the regression model, and a total adjustment for all intangibles, based on the difference between their residual score and the score the appraiser gives the subject for percentage ranking of the subject compared to all of the sales in the neighborhood. You can split that score adjustment however you want, but it doesn't change the total adjustment for the intangibles.
The method I use, can be used as a general method for measuring the value of almost any object with both tangible and intangible features.
In other words it is an exact measure of the total worth of the intangible features of a sales comparable; but done in such a way that the appraiser has things set up to do a fairly precise and meaningful estimate of the value for the subject property's intangible features. And, simple math says, you you can split those total adjustments up however you want between the condition, quality of construction, functional utility, view, aesthetic appeal - it won't make any different on the total adjustment to the subject.
Plenty of clues. See if you can understand the method.
I consider the method very clever, if I don't say so myself, on par with Eratosthenes indirect measurement of the circumference of the earth 2300+/- years ago.
I was discussing this with one of the statisticians over at Salford Systems, and I'm not sure he understands it yet. But, then he is not an appraiser.
The clue is I use statistics to predict the value contribution of the tangibles, subtract if from the actual sale price to get an indirect measure of the intangibles. I do this for maybe 300 recent sales in a neighborhood. I rank the residuals form lowest to highest and give them scores 0.0-10.0 in 0.5 increments reflect the percentage of residuals of lower value, using an Excel macro, then replace the macros with the actual scores (so I can re-sort and they won't change), then create a function that maps the scores to the residuals and thus, all comps in your grid have the adjustments for tangibles based on the regression model, and a total adjustment for all intangibles, based on the difference between their residual score and the score the appraiser gives the subject for percentage ranking of the subject compared to all of the sales in the neighborhood. You can split that score adjustment however you want, but it doesn't change the total adjustment for the intangibles.
The method I use, can be used as a general method for measuring the value of almost any object with both tangible and intangible features.
In other words it is an exact measure of the total worth of the intangible features of a sales comparable; but done in such a way that the appraiser has things set up to do a fairly precise and meaningful estimate of the value for the subject property's intangible features. And, simple math says, you you can split those total adjustments up however you want between the condition, quality of construction, functional utility, view, aesthetic appeal - it won't make any different on the total adjustment to the subject.
Plenty of clues. See if you can understand the method.
Condition is far more important than GLA or location around here. 
