MLS Comp Photos WTF!

[CANative]

Do the best you can do ... for you and your client.

 

[Stone]

Do the best you can do ... for you and your client.

Just make sure you are doing what you say you are doing.

 

[timd354]

I once again have a request for me to replace two photos in a report since they appear to be MLS photos, which yes they are, I admit it. What I am wondering (bring flames if you must). How to always have fresh comp photos in every report. For example, the homeowner says "my house is in O.K. shape, a good size, and 3 beds, 2 baths". Obviously he does not know the GLA size of his house, which is understandable, he just lives there and does not care what the "GLA" number means. I look for possible comps that I will need and see that from the range of 3/2 homes in the area there are 28 possible comps from 1200-2300 sqft. I notice that 2 don't have MLS photos so to be safe I go to those after my inspection to look at and take photos of them. Now it's back to the office, 30-45 minutes depending on traffic. Input my sketch, find the GLA size, think about the condition of the subject, then find the 3 or more comps that BEST FIT the subject out of the 28 that sold in the area. After finding them, adjusting them and working up a nice report with low adjustments, am I supposed to take the 1-1.5 hour round trip to photograph the comps I just used? OR, and I supposed to take all 28 comp photos when I am in the neighborhood? I always like to follow USPAP and be as accurate and professional as possible, so I would love to hear how this is done.

P.S. I am very familiar with the subject area and have appraised about 7-8 homes in the same neighborhood over the last 2-3 years. So yes I am competent to work this neighborhood.

P.S.S. This is about half rant for me, but I am open to suggestions

I would suggest that you need to at least drive-by and inspect from the street every comparable sale that you utilize and also take your own photograph of the comparable sales in most case.

The pre-printed Scope of Work included in the standard Fannie/Freddie forms states:

The appraiser must, at a minimum: (1) perform a complete visual
inspection of the interior and exterior areas of the subject property, (2) inspect the neighborhood, (3) inspect each of the comparable sales from at least the street, (4) research, verify, and analyze data from reliable public and/or private sources,​

and (5) report his or her analysis, opinions, and conclusions in this appraisal report.

Thus, in a typical mortgage lending appraisal report, if you are using comparable sales that you did not at least inspect from the street, then your appraisal report is intentionally misleading in clear violation of USPAP.

Additionally, appraisal reports completed for Freddie Mac loans require original photographs of the comparable sales unless a photograph of the comparable sales cannot be obtained and the appraiser provides a reasonable justification for using a MLS photo. Here is the applicable Freddie Mac guideline:

44.12: Standard exhibits (03/31/09)
Each appraisal or inspection report must include at least the exhibits required for the assessment type. The exhibits must meet the requirements provided in this section.
(a)Exhibit requirements
1.Photographs
Photographs must be clear and may be either in color or black and white. They must be original photographs, electronic images or facsimiles that are illustrative of the property. The photographs must be clear, appropriately identified and must clearly show the completed improvements or any conditions that have a material effect on the market value or marketability of the subject property.
•If black-and-white photographs of the subject property are used, the appraiser must have noted in the report any information that would have appeared in color photographs but is not apparent in black-and-white images that could adversely affect the market value or marketability.
•For any comparable sales, if an original photograph cannot be obtained, a clear copy of the photograph of the comparable sale from a multiple listing service (MLS) is acceptable. The appraiser must have provided a reasonable justification for using the MLS source.

 

[Mountain Man]

I always like to follow USPAP and be as accurate and professional as possible, so I would love to hear how this is done.

USPAP has nothing to do with taking comp photos. It's a scope of work issue.

 

[Lobo Fan]

If I get in a spot where I may have a wide range of comps to shoot, I will print the entire list. Once I have inspected the house I will choose the best comps to go shoot. We are required to at least drive by every comp used so we do need to get them.

I did one recently that was in a rural area. I drove all the comps first going down fire trails and cross country. I got to the subject and it was a manufactured home. The order came over as a regular 1004. I had queried the borrower and they thought it was no longer manufactured because it was on a permanent foundation.

Anyway, two wasted hours of bottom scraping rutted roads for nothing. I had to get the order changed to a 1004C and request more time. Went back out and shot all new comps growling and cursing the whole time.

 

[New Orleans Guy]

7-8 homes in the past 2-3 years does not necessarily mean that you are competent!

But I am, I know this neighborhood well. I know the good streets that always sell better than the bad ones, I know what condition the homes are in and I have confidence in the value I came up with. Like I said this was mainly a frustration rant. I will take the photos that look exactly like the MLS ones, except the grass is not cut. Or hopefully I will get to take a photo of a house that was completely renovated after the sale, with the garage closed in and looks totally different than what was marketed and sold a couple months ago. A totally irrelevant photo of now stucco front home with larger GLA and no garage, but it will be current. The way some do it I guess is to take several photos in the field and to only use those comps. I could not sleep well at night if I did it that way so I guess I will be taking multiple trips or drive the whole neighborhood. All of this for 66% of last years fee and if the value is not right with them I spend hours defending myself against "value reconsiderations" requesting me to consider the newer high selling comps.


The reality is that now that the AMC's own us, over (80% of my work is for them) and fees will only drop over time. I love appraising, but I am already leaning towards rehab/flipping more houses.

 

[CANative]

Just make sure you are doing what you say you are doing.

What should be done in the case when a comp sale is excellent but the property cannot be found? Include it off-grid?

 

[New Orleans Guy]

USPAP has nothing to do with taking comp photos. It's a scope of work issue.

I meant that I obey all the rules.

 

[Michigan CG]

.........I always like to follow USPAP and be as accurate and professional as possible, so I would love to hear how this is done.

.........

You are signing a certification that says you inspected all of the comparable properties from the street.

Not doing so is a violation of USPAP since you signed a certification saying you did.

It is not uncommon for me to take four hours to drive the comps.

 

[hastalavista]

What should be done in the case when a comp sale is excellent but the property cannot be found? Include it off-grid?

I just had this situation in an area where you (Greg) are probably familiar with (Lagunitas, up the back roads). I had the MLS, had the MLS photo, followed the MLS directions to the property (which were not that good), stopped and asked someone who was doing her morning exercise walk if she knew where the street was, double-checked my GPS, etc. I could not confirm its location. I saw a property I thought might be it (above the road, up a hillside, so I only saw its profile against the skyline). I took a photo of that.

What I'm going to do is call the agent, confirm the MLS data, put the photo I took from the street, put MLS photo in the report, state I could not confirm the address from the street observation, but include everything else I did to confirm the property's existence, condition, etc.

I've done this before and have never received a question. What else can one do?