Model home 2 years old sold as never occupied

[Tom D]

Most model homes with all their upgrades are sold at a discount, being the last house in the project and the builder wanna get out of their. What is the definition of lived in, having to sleep over nignt, or the sales staff using the bathroom & kitchen. But, easily explainable as to why you use c1 or c2, or any adjustments.

I guess the underwriter might want a similar sample house if you used all c1 homes with no adjustment for age. So then would the adjustment be more on age than on condition with new/newer homes.

 

[alebrewer]

Yep - the regs are VERY clear...

 

[jay trotta]

To be clear, I'm not arguing for - or against - calling it C1 or C2. That is up to the appraiser tasked with the assignment. I'm arguing for using reason, logic, and common sense. More especially when one is tasked with using C and Q buckets defined by the GSE's. You know - stuff like 'well maintained', 'limited' physical depreciation, 'some minor depreciation', etc. Or, how about this one for C1: "newly constructed dwellings that have been vacant for an extended period of time without adequate maintenance or upkeep." (bold added by me).

Again - in light of the inherent lack of quantification in the definitions - explain what you're doing and why (i.e. use reason, logic, and common sense)

Agreed, but then again, we are dealing with the GSE's and therein lies the problem (reason & logic.....lol)

 

[alebrewer]

Agreed, but then again, we are dealing with the GSE's and therein lies the problem (reason & logic.....lol)

Required for you, but not for us...

 

[Terrel L. Shields]

never been lived in.

as a model home, it's been "lived in" the way I see it.

 

[jay trotta]

Required for you, but not for us...

What would you consider and what would the GSE consider; newly constructed dwellings that have been vacant for an extended period of time without adequate maintenance or upkeep."
Adequate-define please (GSE) - extended period of time?
What would an AMC consider.....Adequate?

Just curious, my opinion may vary

 

[alebrewer]

What would you consider and what would the GSE consider; newly constructed dwellings that have been vacant for an extended period of time without adequate maintenance or upkeep."
Adequate-define please (GSE)
What would an AMC consider.....Adequate?

Just curious, my opinion may vary

Not sure what a GSE member or AMC person would consider adequate, but it just seems to me that adding this to the definition muddied up an (otherwise) fairly clear explanation. For me personally, if I step into a house that hasn't been lived in, and I can see no obvious depreciation, and the home still 'feels' new, I'll prolly call it C1. Again, though, the more important idea is to let my users know WHY I called it C1, and make appropriate comparisons in the SCA - IOW, would the market penalize a property for being a year old, but still C1 condition, and - if so - how much? That's gonna be the tough part...

 

[J Grant]

Describing what a property's physical condition is ( C 1 vs. C 2) is the first phase of the development, and the next would be determining any adjustment or market penalties or premiums for the condition.

It seems incredible that some appraisers lump the two together. Regardless of what the market pays, a house never lived in with no depreciation is a C 1. A house with some depreciation and /or prior occupancy is a C 2.

Determine what physically exists, which is absolute to the property and not relative. Then, in the next step, determine if the market is returning a premium, a penalty, or is neutral to any relative differences perceived between C 1 and C 2.

 

[jay trotta]

Not sure what a GSE member or AMC person would consider adequate, but it just seems to me that adding this to the definition muddied up an (otherwise) fairly clear explanation. For me personally, if I step into a house that hasn't been lived in, and I can see no obvious depreciation, and the home still 'feels' new, I'll prolly call it C1. Again, though, the more important idea is to let my users know WHY I called it C1, and make appropriate comparisons in the SCA - IOW, would the market penalize a property for being a year old, but still C1 condition, and - if so - how much? That's gonna be the tough part...

Appreciate your input and again taking the time to respond.
PS: agreed

 

[J Grant]

Not sure what a GSE member or AMC person would consider adequate, but it just seems to me that adding this to the definition muddied up an (otherwise) fairly clear explanation. For me personally, if I step into a house that hasn't been lived in, and I can see no obvious depreciation, and the home still 'feels' new, I'll prolly call it C1. Again, though, the more important idea is to let my users know WHY I called it C1, and make appropriate comparisons in the SCA - IOW, would the market penalize a property for being a year old, but still C1 condition, and - if so - how much? That's gonna be the tough part...

Since a year-old property is not new and one might say a year is recently constructed, standing a year in the elements has to have some minor depression. Therefore, it can not be a C 1, which has no physical depreciation.

C1: New Construction. Definition: Properties recently constructed and not previously occupied, featuring no physical depreciation. Uniform Appraisal Dataset (UAD) appraisal, a C1 condition rating indicates that a property's improvements are new or nearly new, with no signs of physical wear and tear and no prior occupancy:

The market might not penalize it at all in price, but the valuation aspect is a different step then correctly identifying the condition rating. I understand the "me personally" aspect, but I thought the purpose of the C and Q ratings was for the appraisers to use the same set of objective ratings that match the property to eliminate the personal part.?