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local builders balk @mortgage appraisals

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David Sawyer

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Joined
Mar 8, 2008
Professional Status
Certified Residential Appraiser
State
Florida
"Appraisers are adding insult to injury in tough market by not properly recognizing the value of new home...." some Lee Co builders say.

http://www.news-press.com/apps/pbcs.dll/article?AID=/20080614/RE/806150382/1076/HOMESCAPE99

This is in Lee Co, FL (Cape Coral-Fort Myers) where the median SFR has decreased from market highs in Dec, 2005 to today of 37%. On a typical SFR appraisal in certain areas my market approach for example will be $145,000, my cost approach will be $235,000 on a home that sold in Jan 2006 for $325,000
 

Marcia Langley

Senior Member
Joined
Aug 26, 2005
Professional Status
Certified Residential Appraiser
State
Missouri
Poor builders. They can't sell a house for what it costs to build it. So why do they keep building?

Poor appraisers. They can't sell an appraisal for what it costs to produce it. So why do they keep appraising?

In this market there are simply too many workers in every discipline. Some of us are bound to go kaput.
 

Carnivore

Elite Member
Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
Cash is king! In this country there are plenty of people who can pay cash.
So why have they not jumped on these so-called wonderful bargains the builders offer?

This is not the appraisers fault mister builder. You should change banks. The banks make the actual decision when it comes to loan approval.

This paragraph says it all:

"It's hard enough to get a contract to build a house, let alone making sure it appraises," said Richard Durling, owner of Fort Myers-based Marvin Development and president of the Lee Building Industry Association. "I've got willing buyers who'll come in and buy the house, we have a contract, and then along comes the appraiser and says it's not worth X, it's worth Y because you can buy a house one block over that's 50 percent less."
 

Marcia Langley

Senior Member
Joined
Aug 26, 2005
Professional Status
Certified Residential Appraiser
State
Missouri
Builders are so used to having their pet appraisers make sure their deals close they think everything any appraiser does is willful and not market based.
 

Michael Tipton

Senior Member
Joined
Sep 25, 2005
Professional Status
Certified Residential Appraiser
State
Florida
Once again, basic economics-the principle of substitution applies across the board.
 

Randolph Kinney

Elite Member
Joined
Apr 7, 2005
Professional Status
Retired Appraiser
State
North Carolina
It was the appraiser's fault on the way up, it is the appraiser's fault on the way down.
 

Lobo Fan

Elite Member
Joined
Nov 28, 2004
Professional Status
Certified Residential Appraiser
State
New Mexico
Builders are so used to having their pet appraisers make sure their deals close they think everything any appraiser does is willful and not market based.

I think you hit it on the nose. I made the approved list for CW/KB back in the day. I completed three appraisals before KB had me removed. I refused to call a 3 x 4 piece of concrete a patio and made a downward adjustment on comps with patios. The KB salesperson had a full scale meltdown. I told her to make the patio large enough to hold a lawn chair and a Weber, and it would be a patio not a stoop.

It was 2-1/2 years before I saw another order, and that was three weeks ago, for one.

Builders have been pumping up the prices for a long time. If yyou want to get a good chuckle, look at the prices some charge for upgrades. I am sure you have seen it. They complain about a fireplace adjustment where the builder charged $15,000 for a FP. I adjust for much less than that in a typical ABQ tract house.

Or premiun lot prices. What qualifies as a premium lot? One where you cannot pass a roll of TP to your neighbor while both are on the pot, in their own houses? Some of this stuff just boggles my mind.
 

Randolph Kinney

Elite Member
Joined
Apr 7, 2005
Professional Status
Retired Appraiser
State
North Carolina
It's always the appraiser's fault!
Yes it is. That was the implied conclusion of the up market and down market. Appraisers just pencil in the number and magic, the market changes direction.
 

Dennis J. Black ASA IFAS

Senior Member
Joined
Mar 5, 2002
Professional Status
Certified General Appraiser
State
Florida
Lee County Florida is a full scale melt down. I could go into a long list of details but that county was one of the highest flyers so when the uplifting winds stop.... well you know
 
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