How would you do this?

[Terrel L. Shields]

nobody here can be that good in how much $ wise to finish.

Actually, a lot of people are good estimators, when i worked for civil engineers, we often did cost estimates.

A faucet could be $50 or $20,000.

If you stick to the quality level similar to the neighborhood...whatever.

For those making a living with this type of investment, risk is real. You can't remodel and repair without surprises, no matter how diligent you are prior to owning a property.

With new, not so much a problem unless there are bad construction issues

I can estimate the amount of sheetrock needed to finish an interior. i can estimate the cost to install appliances, floor coverings, etc. I can used books that estimators for architects and builders use or hire one to do a cost estimate. This is my go-to cost to cure book. If you can estimate quantities, it can estimate costs. And typically, such cost estimates have a contingency (often 10%) for the unexpected.

 

[Surf Cat]

Full disclosure.... the report in question crossed my desk as a review request. I guess I don't have to say that the appraiser thoroughly mucked it up.

Which route did the appraiser that you're reviewing take out of curiosity?

 

[NC Appraising]

Full disclosure.... the report in question crossed my desk as a review request. I guess I don't have to say that the appraiser thoroughly mucked it up.

2234556

 

[George Hatch]

For the purposes of valuation an appraiser doesn't need to get into counting nails and floor tiles. They're not bidding the job. They're just trying to figure out where in the process the "as is" hits. I generally use the Calif State Board of Equalization cost handbook because it's a state publication, the county assessors are using it and nobody is going to challenge its legitimacy.

https://www.boe.ca.gov/proptaxes/ah531.htm

Unless things have changed most cost guides and references I've seen in the past include a table somewhere which lays out the percentages of costs for the various systems. Like this one:

 

[sputnam]

Which route did the appraiser that you're reviewing take out of curiosity?

Don't know. All the appraiser did was state the as-is value of the subject...something like...'The as is value of the subject is $400,000'. The Client requested some revisions and I'll get another look at the appraisal report after the revisions are made.

 

[Zoe]

Listen to Dwiley on this one. And Terrel. They are your best advice givers.

For reference: @DWiley and @Terrel L. Shields

You want as credible as you can get. They gave you best references. You can search their posts within this thread.

It could save you headaches if you just listen to their posts.

 

[George Hatch]

Don't know. All the appraiser did was state the as-is value of the subject...something like...'The as is value of the subject is $400,000'. The Client requested some revisions and I'll get another look at the appraisal report after the revisions are made.

If they didn't mention anything in their report you might end up having to teach them how to do it. More expedient to repair than to tell your client they need a new appraisal. The borrower paid for a competent appraisal and they deserve their money's worth.

IMO remediating appraisals cures the problem at the source, hopefully to not be repeated again in the future. Simply rejecting appraisals just about guarantees the repetition of that problem in other assignments for other users later on.

That's for the curable deficiency (competency), which it looks like that's what we might have in this example. By contrast (and IMO) when an appraiser is lying that's a deficiency that is incurable (unethical). Others may disagree.

 

[Functional Obs]

The as-is value, the unfinished property would appeal to an investor buyer, a speculator, or a contractor. They might spend an equivalent amount gut rehabbing -a house needing extensive repairs or stripped to teh studs, remodeled, and then resold. Look for those kinds of sales as comps as well as a cost approach, cost to finish, plus profit .

The problem is those investors and contractors would likely be looking for a deal--and offer less than the amount necessary for completion. Also, who is to say what's "halfway" finished? If the original builder used crappy materials or methods, it could end up being only one-third or one-fourth of the way done. Theoretically, things might need to be ripped out and the value not much more than the site.

 

[Tom D]

Instead of one big bear trap of an appraisal, it's gonna be a lot of little ones for the state to nail you, and then do some finishing work on your livelihood.
And the cost for doing the costs wrong.

 

[sputnam]

If they didn't mention anything in their report you might end up having to teach them how to do it. More expedient to repair than to tell your client they need a new appraisal. The borrower paid for a competent appraisal and they deserve their money's worth.

IMO remediating appraisals cures the problem at the source, hopefully to not be repeated again in the future. Simply rejecting appraisals just about guarantees the repetition of that problem in other assignments for other users later on.

That's for the curable deficiency (competency), which it looks like that's what we might have in this example. By contrast (and IMO) when an appraiser is lying that's a deficiency that is incurable (unethical). Others may disagree.

Teaching them how is above and beyond my scope of work... but, sometimes that is how it goes. At this point, I'm looking for them to tell me how they arrived at the number they reported.