• Welcome to AppraisersForum.com, the premier online community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

Model home 2 years old sold as never occupied

J Grant said:
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.?
Click to expand...
You conveniently left out this part of the definition: "Recently constructed improvements that have not been previously occupied are not considered "new" if they have any SIGNIFICANT physical depreciation (i.e. newly constructed dwellings that have bene vacant for an extended period of time without adequate maintenance or upkeep". (bold and italics added by me)

I know you have an unnatural desire to be right, but I'm afraid you're going to have to concede on this one.
 
Tom D said:
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.
Click to expand...
My bold above. That's not going to happen. It won't be available.

The OP didn't mention but, I'm guessing there was some sort of discount for the demo home.

This is going to come down to good ol fashion, tried and true bracketing. Bracketing provides the analytical approach to valuation, and helps prove the appraiser’s impartiality. If you include comparables which are both inferior and superior to that of the subject, it would be hard for anyone to accuse you of undervaluing, overvaluing, or appraising with bias. Plus, it helps with extracting market adjustments.

To make the report look clean, is why I would go C2. I'd have a couple C1's in the report, coupled with a couple identical year built, lived in sales, discounted for being lived in, and hopefully have an equal "upgrade package" match in there, and a plethora of commentary. I'd be bracketed between the high and low sales. That's all anyone could hope for.

If you start off at C1, it's going to be funky looking with across the board adjustments and possibly overvalued....
 
Surf Cat said:
My bold above. That's not going to happen. It won't be available.

The OP didn't mention but, I'm guessing there was some sort of discount for the demo home.

This is going to come down to good ol fashion, tried and true bracketing. Bracketing provides the analytical approach to valuation, and helps prove the appraiser’s impartiality. If you include comparables which are both inferior and superior to that of the subject, it would be hard for anyone to accuse you of undervaluing, overvaluing, or appraising with bias. Plus, it helps with extracting market adjustments.

To make the report look clean, is why I would go C2. I'd have a couple C1's in the report, coupled with a couple identical year built, lived in sales, discounted for being lived in, and hopefully have an equal "upgrade package" match in there, and a plethora of commentary. I'd be bracketed between the high and low sales. That's all anyone could hope for.

If you start off at C1, it's going to be funky looking with across the board adjustments and possibly overvalued....
Click to expand...
Sound logic. IMO, it wouldn't matter if you were calling the subject C1 with downward adjustments for other C1's and upward adjustments for C2's, OR calling it C2 with downward adjustments for C1's and upward adjustments for other C2's. In either case, you're bracketing...
 
I avoid using model sales as a comp like the plague. Always something funky. Have seen some presold new and leased back, some sell after a couple of years with a short term lease back. Some models use as sales offices with the garage converted to the sales office. Others using a room in the house as a sales office. Some have no sales office and are just used strictly as models. But I have never seen one sell at the same price as a similar new build by the same builder
 
alebrewer said:
Sound logic. IMO, it wouldn't matter if you were calling the subject C1 with downward adjustments for other C1's and upward adjustments for C2's, OR calling it C2 with downward adjustments for C1's and upward adjustments for other C2's. In either case, you're bracketing...
Click to expand...
True..... however, I just think you paint yourself in a corner putting the subject demo model at the top. Setting yourself up for endless stips if ordered by an AMC. You have wiggle room with a C2 rating. "True" C1's will definitely be at the top of the range. Easier to work up to the C1's instead of explaining why my C1 is not valued equal to the true C1's. Just my opinion though.
Dublin ohio said:
But I have never seen one sell at the same price as a similar new build by the same builder.
Click to expand...
Agree....
 
Model home used as the sales office for two years is a C2. IMO

What are the adjustments is a different question.
 
Do avms ask themselves these questions. Hey fannie avm, what freddie bro. i got a funky one here. Don't worry, they don't ask us anything. Only the stupid humans discuss, we got government protection.

This is more a discussion of lived in, or occupied, involving a new house. And to what affect, with a C1 seeming to be an absolute condition, new. Doesn't new mean never been used. Or, well, it's almost new.
 
You must log in or register to reply here.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at AppraiserSites.com
Back
Top