New mftr home - no comps

[N43WT]

Some hints from the Fannie Mae Selling Guide, B4-1 (if your subject is rural):

"A minimum of three closed comparables must be reported in the sales comparison approach."

"Additionally, older comparable sales that are the best indicator of value for the subject property can be used if appropriate. For example, if the subject property is located in a rural area that has minimal sales activity, the appraiser may not be able to locate 3 truly comparable sales that sold in the last 12 months. In this case, the appraiser may use older comparable sales as long as he or she explains why they are being used."

"Rural properties often have large lot sizes, and rural locations can be relatively undeveloped. Therefore, there may be a shortage (or absence) of recent truly comparable sales in the immediate vicinity of a subject property that is in a rural location. Comparable sales located a considerable distance from the subject property can be used if they represent the best indicator of value for the subject property. In such cases, the appraiser must use his or her knowledge of the area and apply good judgment in selecting comparable sales that are the best indicators of value. The appraisal must include an explanation of why the particular comparables were selected."

Only two of the three sales needs to be manufactured, also.

 

[George Hatch]

The purpose of citing comparables isn't just limited to using them as a direct indicator of your subject's value. They can and should also be used for the sole purpose of developing and supporting adjustment factors, independent of whether or not they qualify as being among the most recent/similar to your subject for your SC grid.

You can always look at dated sales in the region and compare those to the site built homes to develop the adjustment factor, then apply that adjustment factor to the site builts you are citing for your subject.

 

[Tiffany Gibbons]

So you are saying that the manufactured home dealership sold only 1 manufactured home (subject) in the previous year. How do they remain in business?

They sell plenty of them in outlying areas here, it's just that people already own the land (sometimes for years) or it was gifted to them so there's no sale on record for the land with the improvement, like a custom built home. Also, listing agents don't always use the correct classification in the MLS, so I wind up searching everything looking at pictures to find the sales. Many are on acreage and not classified correctly by the rural assessors. Despite all the affixation affidavits, deeds, etc., sometimes it can be a couple of cycles before they get classified properly in the system (depending on foundation, etc.).

 

[CCAAMO]

The cost to build does not mean there is a market for that home or if there is that buyer's a willing to pay the cost to build or above. The market approach even with limited data should be able to support if there is demand and if buyers are paying at or above the cost to build