Is Driving By Comps Still Necessary?

[George Hatch]

Mike,

True enough. We can't always trust the RE agents to be completely accurate about their properties and we can't know quite as much about the property without seeing it. Yes, going inside all the comps would be better than merely seeing it from the outside, but I submit that at least seeing it from the outside is better than not seeing it at all.

If the RE agents knew that appraisers were routinely relying solely on their descriptions and would never check up on them, do you think that would have any effect on their level of accuracy? I do.

 

[Alan Simmons]

To me the answer to this question lies in how an appraiser views his job.

If an appraiser thinks he is just supplying the client with a product (report) then the prudent thing to do is cut cost.

If the appraiser is trying to provide a service to help his clients make informed decisions then the best practice is to view the comparables. This is not to say that an appraiser has to view the comparables to do a good job, but that it should be the default position.

I decided not to use two comparables this week after viewing them.

 

[jeff samolinski]

I don't think there is any requirement that would prevent us from using a comp photo from a previously done appraisal in a new appraisal is there? Nothing says that we must drive by the same comp each and every time we use it?

Does this point out a discrepancy between USPAP's move to a scope of work driven appraisal process and fannie's certification requirements.

Just re-read the cert. from a 2055 form and it indicates that: I performed "this" appraisal by 1)personally inspecting from the street the subject property and neighborhood and each of the comparable sales(unless I have otherwise indicated in this report that I also inspected the interior of the subject property). seems pretty tight except that could I have performed this neighborhood and comparable sale inspection from the street previousely and still be able to find that past inspection reliable for this report I am now doing? I think so. Might be one them there "it depends" deals eh!!!!

Also some interesting existing language on the statement of limiting conditions and appraiser's certification form number 7 regarding another good thread going on the Arizona court case.

 

[Charlotte Dixon]

Originally posted by LEROY TURNER@Feb 18 2005, 08:09 PM
Glad you folks have a good MLS provider. In my area, especially delaware.

Leroy,

Here's the e-mail address to complain to for TrenD MLS. The Chairperson of our Delaware Council and myself have complained repeatedly to this person, and our Chairperson submits a "Boo Boo of the Day" EVERY Day to Trend. Between me and the Chair, we have enough inaccuracies to submit all the way up to May, and that's without more mistakes being made every day. Here's the address:

Rwhitelock@trendmls.com

It seems all our complaints have done something and just recently, there is a notice under each picture in the MLS called Accuracy Issue. If you find something wrong with the settled sale or otherwise, you click on that item, type in your message and they now have a person that goes after the agent and forces a correction.

If we all complain and report these issues, maybe we can clean this mess up.

Charlotte

 

[Steve Owen]

Good thread, Jeff.

Short answer, you don't have to drive by the comps unless your client wants it. (Fannie does.)

Funny story. In the early days of departure, a client called and asked for a drive-by. When I told them the fee, they started fishing around for ways to make it cheaper. I said, "Well, there's going to be about 100 miles of driving to look at the comps - if you really want a cheaper appraisal, then if I didn't have to look at the comps and put in comp photos, that would lower the price."

The LO said he'd check with his boss. The answer: go ahead and do it - we need the comp photos. :rofl:

To the answers the Duck (and others) gave, let me add one more. It's a good idea to look at the comps personally because some houses photograph better than others. Did any of you ever do any internet dating? :rofl:

Concerning whether you have to go by more than once. Normally, you do not. You are certifying that you have seen the property, not when. The best information you can possibly provide is what the condition of the comp was at the closest date to the sale as possible. Usually, there is no value in going by again (although I sometimes do if it is on the flight path). The main exception to this rule is if the sale was really a land sale. You go by the week after closing and everything looks normal - two weeks later it's bare land because that's what the buyer was really purchasing - then you know it's not a good comp. (BTW, if a tornado blew it down, there would be no negative effect - you could still use it.)

 

[Deleted member 80407]

I do believe by not driving the comparables, the report is less accurate. I thought there were some guidelines out their for supporting adjustments. By not driving the comparables, how would one know if the listing sheets have accurate information. Usually if there is a discrepencity on the listing sheet, I have a picture supporting my adjustment.

*I have seen listing agents list a property with a three car garage. When driving the comparable, I notice that this oversize garage only has a two car overhead garage door.

*If a comparable property sides or backs to a commercial property (maybe a gas station), I make sure my picture includes some or all of the external obsolesence to support my adjustment.

*I have seen listing agents list a comparable property as having a brick exterior when in fact, the exterior siding was of insul-brick (asphalt) that looked like brick.

*I have worked markets where some sales comparables were less than three months old. Driving by some of these comparables, I observe the house was torn down to build new.

*Wondering if a comparable property had external obsolescence, the MLS picture would reveal the problem. I have completed several appraisals of homes backing to high voltage power lines where the MLS picture did not reveal the if the sales comparables presented also back to power lines.

Most of the clients I perform appraisals for will accept MLS pictures, however, they have to be presented as additional comparables and not of the three primary sales presented. Some times I find sales closing the day of or the day after my inspection date or were not imputed at the time of the subject's inspection date. When using a MLS picture, I "always" present it as an additional sale and state that I did not personally inspect the exterior of this comparable.

 

[jeff samolinski]

I think the ole it depends is at work here-some good discussion though from which I have learned a few things.

 

[Stone]

Originally posted by Charlotte Dixon@Feb 21 2005, 08:18 AM
It seems all our complaints have done something and just recently, there is a notice under each picture in the MLS called Accuracy Issue. If you find something wrong with the settled sale or otherwise, you click on that item, type in your message and they now have a person that goes after the agent and forces a correction.

Ooooooh. I like that, Charlotte. I will have to mention that to our MLS provider, the next time I am at their office. That would be a great addition to the system and would increase the accuracy, IMO.

 

[Charlotte Dixon]

If anyone wants a copy of one of our MLS pages to take to your MLS provider, or county board, private message me with your fax number and I'll fax you an MLS page and the simple form we fill out with our complaint. It's working already!

 

[Jim Onderisin]

A large national bank in this area orders 1004 form reports with interior inspections, but no comparable photos. They want fast and cheap. I've tried doing these, but they aren't worth the time. Whether I provide the comp photos or not, I still have to inspect the comp exteriors.

The problem is there are appraisers doing these assignments who don't bother with the comparable inspections. They pull info out of the MLS and put the report together. The reports are garbage. I've been given copies of them by borrowers. The reports don't consider obvious external influences or quality differences, either in the construction or the location. Twice, I've seen reports by the same appraiser with living area measurement errors exceeding 10% of the actual size of the property. Too big a hurry measuring is my guess.

This is a lender-driven problem, but requires a willing appraiser. My opinion: if you are signing the certification outlining the scope of what you have done in the assignment and you don't do everything you've certified, you are opening the door for eventual trouble.