Marshall & Swift

[Stephen A. Santini]

Im just curious on how many of you still subscribe to Marshall & Swift since the cost approach is not really relevant on the new 1004 forms. I still complete the cost approach on my appraisals, however I don't feel that Marshall & Swift estimates are all that accurate. Any thoughts on this subject would be.....of course.....welcome.

 

[Lee Lansford]

I have been utilizing the M&S Residential Cost Handbook for approximately 20 years.

I find that M&S is a reasonable source of cost data.

Note: I suspect that many appraisers accept the "pin-point" number for any item as THE cost figure.
If the base cost for your dwelling is $83.50/sf (average quality) and the good quality house has a base of $102.25...what, there is no need for a bit of interpolation?

The cost/sf method is the least accurate of the costing methods; for mortgage work, it provides reasonable results.

Also, I consider it wiser to provide replacement rather than reproduction costs for mortgage work.

Finally, the Cost Approach is just as relevant today with the "new" Fannie forms as it was with the "old" forms. Nothing has changed in that regard.

 

[Smokey Bear]

I pay as I go, using Swiftestimator.

 

[Peter LeQuire]

I use M&S: it is, at least, a recognized source of residential cost information, and probably supports an assertion of "defensible" to that portion of the report. It is, obviously, prudent to check it against the reality of what's going on in the pertinent market: in general, I find it a reasonable source of readily available information.

 

[Steven Straka]

I also use SwiftEstimator. You just have to be mindful of the quality rating that you input, the type of construction (e.g. masonry, plywood, etc.) and the accessories that go into the calculation.

Speaking of the new form, I no longer use the extraction method by itself. I'll use Marshall & Swift and perhaps one other "secondary" source for building costs (including appraiser's fee) and then provide a scanned copy of my calculation/report. The results should be replicable and easy to follow (i.e. layman's terms), with sources clearly indicated.

SwiftEstimator runs $8 per file, so I use it on a per-case basis.

 

[hastalavista]

I use it for the same reasons Lee cited (although, not for 20-years! Lee- I hope they give you a long-term client discount!).

Two additional thoughts:

How many appraisers who "cite" M&S as a source on their reports actually have it? Do you think maybe 20%? I doubt if it is more than 5%. I suspect that every state regulatory board or any attorney with experience in litigating against a residential appraiser believes the chances are much better than "even" that a report that cites M&S as a source didn't use it in the analysis. I cite it and use it, and keep the back-up in my workfile. If I'm ever questioned, at least I'll have additional piece of evidence that will add to the credibility of my reporting process.

The new Fannie form states that the Cost Approach data must be cited so that it can be replicated by the lender. So, I cite the version and update of my M&S (Res. Est. 7, 03/06), the quality/condition rating, local multiplier, "current cost" factor, and any additional adjustments I make to the cost figures. A lot easier than citing a local builder or contractor with Tel# & contact info (which I've never read in any of the reports I've reviewed, even though many of the reports say "per local builders") as my source.

In my mind, as costs go, this is relatively "cheap" compliance insurance.

 

[Doug Meyer]

I agree with Peter as I gain other additional information from the cost manual for unusual properties. Have you really read the manual or just open it up to find replacement cost data?

 

[CANative]

For nuisance CA's on modest homes I just use the calculator at www.building-cost.net and modifiy it a bit based on the local area, topography, etc. I calculate detached garages, yard improvments, and misc. stuff from M&S and customary local costs if unavilable or inaccurate in M&S.

For MH's I use NADA, unless the data plates are gone or the model is not listed in NADA in which case I use M&S.

For proposed or new constructon I use SwiftEstimator at $8 a pop, and reconcile the data to construction bids I have, adjusting the calculations as needed.

I haven't renewed my subscrition to the printed M&S this year. Not sure if I'm going to.

 

[Mr Rex]

Anybody use the Residential Express version of M&S? Still using the book and when I do the Cost Approach, I always do it on a 1007, so the software might speed things up. But the Full blown 7 version is too expensive. Might try SwiftEstimator a few times before I renew or upgrade.

And if anybody uses Express, does it cover manufactured? If I remember correctly, manufactured was not included.

 

[Elliott]

Here's a little cost saving tip. Buy M&S for one year,
get a good calculator or better yet use a spreadsheet,
Calculate the exponental curve fit for there data....
you find it has a R2 of 99.9% (cause that's what they
use). Fit it to construction jobs as you go along for
the next year. After that you really don't need to
buy the book. The curve parameters DO NOT CHANGE.

elliott