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I Didn't Hit The Number

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Wally Jones

Thread Starter
Senior Member
Joined
Jan 23, 2002
Professional Status
Certified Residential Appraiser
State
Florida
Okay. I've read about it and sympathized with others about it but now it's happened to me.

Called a lender to see why I haven't heard from them lately. Seems I had two reports in the past six months that came in below the value of sales contracts. The lender said the contractor (same one in both cases-proposed/new construction) told them to not use us anymore and they hired another appraiser to bring both of those reports "in line" with the value they needed.

I called the contractor's office and they said they weren't aware of any problems and they planned to use us in the future.

Trying to figure out a way to get copies of the other appraisals (assuming they actually exist), but no luck so far.

The client didn't send us that much work so I'm not crying too hard over losing their business. Sure would like to have some hard evidence to turn over to the state, though (for the lender as well as the appraisers involved).

Any suggestions would be welcome, but thanks for letting me vent.


Still Sleeping Well At Night,

Wally
 

David S. Roberson

Senior Member
Gold Supporting Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
Wally;

Get over it & get used to it. Mortgage brokers don't want appraisals; they want forms filled out to sell mortgages & when that doesn't happen they go somewhere it will. Contractors are liars "No, it wasn't us who complained when we couldn't sell the house for more than it's worth & we'll sure call you to do another one real soon". Borrowers are liars "I promise I'll install that flooring later/the last guy appraised it for $zzz more just last month/I'll pay for the appraisal later whether the loan closes or not." It's all part of the Wonderful World of Appraisal. Zippety Doo Dah!!!!!!!!!
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Walley;
Well you didn't hit the number-big deal; you haven't supplied enough information for anyone to figure out what the story is;

Two-new construction houses - how far out of line are you :?:

8)
 

Wally Jones

Thread Starter
Senior Member
Joined
Jan 23, 2002
Professional Status
Certified Residential Appraiser
State
Florida
I'm over it. Thanks.

I wasn't really looking for sympathy. Have had plenty of reports short of expected values. This is just the first time I had been told that I wasn't going to get any more business because of it and that another appraisal had come up with the "right" number.

jtrotta: In both cases, I was 8-10,000 short of the contracts. Four comps in the same neighborhood all sold within the past six months, each very similar (two built by the same contractor).

Sorry if this came off as whining. I know that my reports are defensible and I like the challenge of making them that way. Just bugs me when I can't catch the crooks operating in my neighborhood.

Again, thanks for putting up with the "frustration release".
Now, back to work! :lol:
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Walley
glad your over it and I don't give out sympathy;

8-10K - you still leave a lot out; so I'm up for a few Q/A -
are we talking 1000SF / 2000SF dwellings :?:
Are we talking $100k; $200k; $300k - what price range are you in :?: You say the comps are within 6 months, so can we assume the materials were purchased 9-12 months back :?:

Would that time frame possibly cover the "contract" time frame also :?:

You said, these houses are under contract for purchase, both houses :?:

You also state they are new-Proposed Construction -so their not built as yet and we're looking at a Future value :?:

Now, what reason would it be that these Buyers are willing to pay more than, what previous properties have sold for :?:

Where is the Builder in this project :?: Begining; Middle; End :?: :?:

Do not get the wrong impression, I'm just trying to see where all this is comming from - ay

8)
 

Wally Jones

Thread Starter
Senior Member
Joined
Jan 23, 2002
Professional Status
Certified Residential Appraiser
State
Florida
jtrotta,

Thank you for taking the time to ask for the details.

Both homes are similar. 1800-2000SF GLA. Only extras are screen patios. Both are within a PUD. Two of the comps are within the same development, two in a nearby similar PUD. Contracts are for 150-160K. Construction had begun on both homes at the time of the appraisals. The two comps within the same PUD were completed within the previous six months. Yes, the materials were purchased within 9-12 months prior to the appraisal. Contract time frames were within 30-60 days of the appraisal. One of the buyers is from out of state, the other from a nearby county. I don't know why these buyers would pay more than previous properties, some even larger than theirs, have recently sold for. I've done four other appraisals for new construction in this PUD over the past 18 months. The contract prices of these two most recent sales stick out like sore thumbs. I reckon I have more questions than answers, but now I have to prep for a tough one - two blocks from my house! :D

(Now I'm going to dream about getting the assignment to appraise those two places when they want to refinance.......... 8O )
 

Lee in L.A.

Elite Member
Joined
Jan 24, 2002
Professional Status
Certified Residential Appraiser
State
California
Sounds like a bad dream Wally. They'll probably think it's worth a WHOLE lot more 6 months or a year from now. :lol:
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Walley,
interesting that one Buyer was from out of town, were they the lead Buyer? Did they contract first?? If they did, they were the driving force for the increase (partially); next part of the puzel- have the cost to build increased since the builder first built?, if they have, then he is/maybe trying to compensate, as the next dwellings will cost him more and he may already know he's going to have to bite the bullet and eat some profit, in order to create a deal on the next units.

You say that you've done a few others overt he past 2 years, so how has the growth for those units faired?? What was the growth percentage?? Now, you originally said you were only $8-10k under; and from what you noted as the contracts, am I assuming your in a 4-8% difference?? If so, don't know if the "sore thumb" motive fits.

Recently, did a similar "new construction" in a newer sub-division, and the growth was approximately 29% (over the past 2 years) - the dwellings are similar-1600 to 2200 SF (freaky-ay) and growing. Now I know we're not in the same area, but some time it surprises you as to how quickly "new contruction" projects grow. In my experience, new construction can get away from you easily - make sure you check out everything, and I mean everything, otherwise you'll shoot yourself in the foot more often and get a lot of bad feedback. You might consider this a specialty field and you need to really know your stuff, (everything)- how much have building materials increased; plumbing; electrical; etc. - I've seen them increase in a 30 day period (40%) and that may happen 2-3-4 times in a year, it'll curl your hair - hope I've given you something to think about 8O Thats enough from me now :!:

Good Luck 8)
 

EDWARD BERRY

Senior Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I know that hurts even though that volume is was not high.

However based upon what we see here in Arkansas, that is the future and our volume will slowly be less and less.

My work with builders was so good that they would let us do appraisals on each of their proposed sd's. (personal work, not for lenders)

We were doing about 300/year on the HUD panel, now about 4-8.

Fortunately, our special work(Repos, RElos, and farm work has replaced the happy number hunters.

My sympthany to professional appraisers. your time is short. ed in arkansas.
 

Charlotte Dixon

Senior Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Delaware
Wally.....Good job!....Many of us don't hit "the number"..... we just have to move on. For every one crooked lender we lose, we will gain 2 good ones! You've done the right thing; just don't worry about "getting back"....your time can be better spent cultivating new clients. Again, good job!

Edward......
Where are you from? I thought our state was the "chicken capital of the Eastern Shore"..... :?
 
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