New Commercial AVM.hmmm.

[JTip]

If I may ask a question or two: Since 'evaluations' are NOT appraisals, why would lenders want a general to complete the assignment?

Could a non-appraiser complete a 'evaluation', like a broker or sales agent?

Is this kind of like an appraiser assisted AVM where all they want is the peace of mind of having a certified signature?


Answers are optional.

 

[J Grant]

I've often wondered if some types of commercial work lend themselves to evaluations or computer assisted reports. Since so much of commercial relies on the numbers, cash flow and leases and cost approach, if a research analyst can find the numbers and data, they have what they need to generate a report. That is one of the threats of the internet and the easily available data either for free or for sale. Of course commercial appraisers pride themselves on the narrative aspect, but if clients start to de value the narrative aspect, that becomes part of the mix.

 

[Kali the Boston Terrier]

Reading their property type offerings, many are property types that are only reliable via an income approach. Cracks me up three comps and a photo...sounds like a re-purposed residential solution. Any lender willing to loan on that, and not knowing anything on how to value their collateral deserves to be taken over by the FDIC.

 

[The Warrior Monk]

I've often wondered if some types of commercial work lend themselves to evaluations or computer assisted reports. Since so much of commercial relies on the numbers, cash flow and leases and cost approach, if a research analyst can find the numbers and data, they have what they need to generate a report. That is one of the threats of the internet and the easily available data either for free or for sale. Of course commercial appraisers pride themselves on the narrative aspect, but if clients start to de value the narrative aspect, that becomes part of the mix.

One of the major issues that can arise with commercial properties is the HBU issue. I see it all the time, in both lending and nonlending assignments. This often can't be readily determined by a casual observer, and can result is an egregious misvaluation of the property.

 

[Michigan CG]

This has trouble written all over it:

http://www.firstamprs.com/products_services/survey_site_coordination/commercial_evaluation_services

And a sample "evaluation report":

http://www.firstamprs.com/sites/default/files/pcer_sample_6-2012.pdf

.......................

Insanity, but consider the source, First American. 'Nuff said.

http://www.firstamprs.com/sites/def...ntempi_sczerba_thomas_front_back_jan_2013.pdf

fees

I doubt they can find anyone to get out of bed for those fees.

 

[J Grant]

One of the major issues that can arise with commercial properties is the HBU issue. I see it all the time, in both lending and nonlending assignments. This often can't be readily determined by a casual observer, and can result is an egregious misvaluation of the property.

That depends on what the clients are willing to accept. If an evaluation is done by an appraiser, they are still developing a HBU. If it is less detailed then what you provide, if the clients decide they don't need the detail, then that creates a new standard of acceptance. Not saying that is good, but what happens when client expectations shift

And if the reports are done by an analyst and not by an appraiser, is the non appraiser allowed to develop a HBU analysis? Is there a rule only an appraiser can do that?

 

[Michael S]

I've often wondered if some types of commercial work lend themselves to evaluations or computer assisted reports. Since so much of commercial relies on the numbers, cash flow and leases and cost approach, if a research analyst can find the numbers and data, they have what they need to generate a report. That is one of the threats of the internet and the easily available data either for free or for sale. Of course commercial appraisers pride themselves on the narrative aspect, but if clients start to de value the narrative aspect, that becomes part of the mix.

If you have a new construction single tenant retail building with a long term lease to a credit tenant then you could pretty easily plug in the numbers and spit out a credible value. However, there's only so many new Walgreens, Dollar Generals, O'Reilly Auto Parts, etc. that get built every year. For the other 99% of properties it generally takes a bit more work.

Edit: Fixed.

 

[George Hatch]

With respect, I hope never to see you use the term "accurate value" again.

 

[CBBoston]

Pay peanuts. Get monkeys.

 

[JSmith43]

Credible is where politicians say words that are so enticing that the voters believe them.

Accurate is where the politicians tell us what a mess we are really in and they do not get elected & eventually become appraisers, etc.:icon_mrgreen:

But, that's politicians. Appraisers reside in a separate reality distortion field.