New USPAP Q&As published March 6, 2025

[Mile High Trout]

The best possible thing anyone can do with the three new AO's, is completely ignore them.

They're trying to look busy to avoid federal investigations into three decades of funds abuse, federal violations of applicable statues, upcoming class actions and other various measures of accountability.

Fun factoid. Did you know every single dollar the ASC takes in, and subsequently grants to TAF, are 'federally regulated dollars', with applicable federal spending rules attached?

You bet partner. It's in the ASC's own grant guide documentation, noted as specifically applicable to TAF. Every book purchase. Every licensing fee. Every AMC fee. Every single dollar the moment that dollar flows to ASC, ASB, or TAF, a federally regulated dollar. It does not matter if these groups have congressional appropriations or not. We've all been living a lie this entire time.
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I wrote a long piece on this but how about something more fun instead?

1. Experience is not a recognized method or technique to determine a park adjustment.
LMFAO. Maybe one of these fancy data analysis tech companies has the inside track at ASB now, and they're pushing this to sell more automated market data analysis software. Who knows. I'm going to ignore the issue until it goes away.

2. Is an appraisal reviewer required to develop alternate adjustments if they disagree with the first adjustments? No.
Merry christmas! Sure fire ways to get immediately blacklisted with any lender in America. Somewhere out there a volume AMC appraiser is arguing with the AMC manager about scope of work requirements for ten dollar assignment hybrid forms review work which relied on pdc inspectors and they're complaining to the ASB for clarification. What the heck are they ordering the service for?

3. Are appraisers required to follow standards when opining a short term market rent?
This is like the business plan on a bar napkin argument. I got that appraisal done in ten minutes flat, no workfile or standard adherence necessary. Not the way it works... Does anyone else need their hands held when it comes to understanding basic practicing standards? I blame the poor state of continuing education for the need to have this one on the books.

To conclude;

What are these people doing? The industry is in freefall. Forty thousand appraisers are getting cut out of their primary income stream in mortgage lending with the avm final rule, waiver and pdc programs. The market is distorted with untold volumes of existing data cancer, price discovery is hidden behind a veil of secrecy as lenders push 40 year and 115% ltv loan mods. Ongoing restraint of trade issues nearly two decades now. And this is what the ASB is paying attention to? It's hard to describe to those outside of this industry how incompetent the patterns of management have been for so very very long now. Where is the appraisers advocate? These AO questions don't really matter if nobody is working. Independents outside of lending go next.

 

[The Bob]

So show us how this works. If inventories are declining, does that always prove that prices are increasing (I have seen the opposite). If doms are increasing, does that always mean prices are falling? If prices on pending sales can't be verified, what does that information tell you other than there is an offer on the table? If listing prices are increasing but properties are not selling, does that always mean prices are increasing? If sales price to list price ratios are stable, does that always mean prices are stable? And how do you translate increasing doms to a dollar or percentage change in values. It is easy to throw this crap at the wall, but I challenge you to provide a single source where these techniques are demonstrated in a manner that the majority of appraisers will agree with (and remember, experience is not support).

And if it is critical to demonstrate trends as of the effective date of the appraisal, and make market conditions adjustments to that date, how does the use of an HPI where the most recent data is 60 to 90 days old accomplish that? And why don't the HPIs include trends through the current date? The GSEs have opined that everything other than closed sales can be relied on to accomplish that so why haven't they done it themselves?

GSE folks make a lot of claims that can't be verified because they hide the data. Not really very different than appraisers who suggest their conclusions are based on experience, except that there are mechanisms to make appraisers prove it.

That's a very naive way of looking at it. None of those factors, by themselves, tell you much. But in aggregate they do tell a story.

I love how some appraiser's, not you, will say a pending can't be factor. You can only use closed sales. But if all the listing's are going into escrow under the list price, would you ignore that? Then why would you ignore contracts consistently above list? It's market data. I can count on two hands the # of pending's I've seen fall out of escrow. The vast majority go on to close.

 

[CGinMN]

This reminds me of the FRED median sale price comparison with case shiller index. Index showing continuing to increase trend while the median sale price trend showing slightly lower year over year since 2022.

The reliability of these indicies are really questionable based on what you are saying.

The HPI actually seems close on this one, which is likely coincidence. My point is that it should display the appraisal at +52% since the prior sale, not +34%.

In other words, this is how CU calculates the rate of change: (425,000-279,900)/425,000 = +34%
This is how it should be calculated: (425,000-279,900)/279,900 = +52%

I heard someone at the GSE's make regarding appraisal waivers is that their models are better than appraisers in detecting market trends and are quicker to detect changes in market trends/market direction.

I believe they believe that is true. But then again, this model has been wrong for 10 years and they haven't noticed.

 

[TerryRohrer]

That's a very naive way of looking at it. None of those factors, by themselves, tell you much. But in aggregate they do tell a story.

I love how some appraiser's, not you, will say a pending can't be factor. You can only use closed sales. But if all the listing's are going into escrow under the list price, would you ignore that? Then why would you ignore contracts consistently above list? It's market data. I can count on two hands the # of pending's I've seen fall out of escrow. The vast majority go on to close.

Did you miss the part about not being able to verify pending sale prices? Here, no one will disclose. So I'm naive. Tell me how you spin anecdotal information into a monthly inflation rate. I'm not interested in guessing, nor do I sell reports by the pound, so have no interest in spinning yarns to cover unsupported guesses.

 

[CGinMN]

It is very easy to get contract prices from realtors, but you have to pick up the phone, and you have to know how to get it out of them. Once you have that info on 2-3 competing pendings, they can be compared to the closed sales in the SCA to derive some type of indication. The biggest thing is to know when the market has abruptly shifted. I talk to appraisers who are completely unaware of what is taking place, and think it's dead when homes are selling in multiple offers for the past couple weeks. They don't have their pulse on the market because they aren't talking to agents. I get that it is much easier to analyze the data in a suburban subdivision where you have tight adjusted ranges, much less so in rural markets, so I know why you're skeptical about it.

 

[TerryRohrer]

It is very easy to get contract prices from realtors, but you have to pick up the phone, and you have to know how to get it out of them. Once you have that info on 2-3 competing pendings, they can be compared to the closed sales in the SCA to derive some type of indication. The biggest thing is to know when the market has abruptly shifted. I talk to appraisers who are completely unaware of what is taking place, and think it's dead when homes are selling in multiple offers for the past couple weeks. They don't have their pulse on the market because they aren't talking to agents. I get that it is much easier to analyze the data in a suburban subdivision where you have tight adjusted ranges, much less so in rural markets, so I know why you're skeptical about it.

Well, I know how to dial a phone number (I even have a smart phone, not a rotary). And I can even find a phone number in every listing sheet. And here ( despite some appraisers' assumptions that they know all things in all markets), agents do not disclose pending prices, whether you think so or not. I am well aware of what the trends are because I look at everything that is available. And I seldom get any actionable information from agents. I can sing a song as long as anyone's, I just don't guess and disguise that in piles of BS. Nor has anyone ever questioned my market conditions adjustments to date (except one AMC idiot who thought a huge negative adjustment in a strong up market was warranted from minimal 1004MC data). So, if someone wants to bring factual information to the table, I'll listen. But if that doesn't provide a means to measure rate of change in prices, I'm not into fluff. I see plenty of how others around here do it and don't intend to emulate them.

 

[Mike Ault]

It is very easy to get contract prices from realtors, but you have to pick up the phone, and you have to know how to get it out of them. Once you have that info on 2-3 competing pendings, they can be compared to the closed sales in the SCA to derive some type of indication. The biggest thing is to know when the market has abruptly shifted. I talk to appraisers who are completely unaware of what is taking place, and think it's dead when homes are selling in multiple offers for the past couple weeks. They don't have their pulse on the market because they aren't talking to agents. I get that it is much easier to analyze the data in a suburban subdivision where you have tight adjusted ranges, much less so in rural markets, so I know why you're skeptical about it.

Realtors don't disclose pending sales prices in my area of this non-disclosure state. And three different presidents of the Amarillo board of Realtors have been members of my family.

 

[Terrel L. Shields]

Appraisers should be able to evaluate market trends by looking at inventory trends, DOM trends, pending sales, listings,

You don't do rural property, do you?

It is very easy to get contract prices from realtors, but you have to pick up the phone

Not here. Lawyer for the RE Commission recommended to not do that - "privacy" issue according to him. That's AR. OK Realtors are a little more open generally.

 

[CGinMN]

I see. Well, that’s a lot of chronic rejection. Let’s process those feelings next week.

 

[glenn walker]

Realtors don't disclose pending sales prices in my area of this non-disclosure state. And three different presidents of the Amarillo board of Realtors have been members of my family.

If it's a non disclosure county or state all the better nobody can prove squat so just use the pending at whatever it was listed at that's why there called pending and not closed. A pending flight to Japan means the plane took off it doesnt guarantee the flight isn't going to crash on its way.

But Hell I'm already fed up with Amarillo Texas and rather than listening to why
a pending can't be verified i want to hear the apprasers saying i know everybody in this County and every Realtor and Billy Bob's family verified it and thats my story and I'm sticking to it and the Realtors number is also non disclosure as i can't share confidential communications under Texas Law.

Mike Be like our A Holes in Alaska the apprasers all five would say F you this is how we roll up here and if i say it's pending at $400k then it's pending at $400 k ..but that's not a guarantee it's closing at $400 k and that my friend is why they don't call it a closed sale..I liked that A Hole and that made sense. In Alaska they don't care if your the CEO of Fannie Mae or a State Board.