No Adjustment Because Condition Is "assumed"

[timd354]

i don't know how you can make a judgement on an appraisal report without seeing the whole report. Seems the line the appraiser used is truthful as we do not have first hand observations of the comparables insides and most rely on MLS photos.

I can very easily make a judgment...that one statement makes the whole report not credible and I don't need to see anything else in that report to know that....I simply not going to allow such a report to be utilized to make a decision to put my company on the hook in first loss position in case of a default by insuring that mortgage.

Appraisers typical don't personally measure the GLA of the comps either (instead relying on public record and/or MLS data). I guess that means that you think that appraisers shouldn't make any adjustments for GLA either, right? Yeah, I didn't think so.

 

[djd09]

the perfect appraisal in the perfect market would have no adjustments. you probably believe since there is a 100 sf difference in GLA there should be an adjustment. or we could use fannies insane 100 per sf adjustment even though the sale price includes land.

 

[hastalavista]

Just because there are different rating doesn't mean there is an adjustment. The appraiser probably didn't hit the number now they are nit picking the appraisal.

But the report doesn't make that case.
The report states that regardless of what other sources may indicate, since the appraiser did not personally verify any of it, the report then assumes everything is the same.
That simply isn't reasonable for a GSE assignment.

 

[gregb]

Reviewed a 2055 SFR a few years ago.

Subject assumed to in average condition based on exterior driveby observation from the street.
All five comparables stated as average condition based on exterior driveby observation from the street.

Notwithstanding three of the comparables were stated in agent MLS comments to be completely remodeled with MLS photos attesting to the other-than-average condition. Oh well, at least the appraiser was consistent, basing condition only on observations from the street.

 

[djd09]

The report states that regardless of what other sources may indicate, since the appraiser did not personally verify any of it, the report then assumes everything is the same.

That is not what it says

 

[djd09]

I get that appraisers are suppose to make adjustments based on "market reaction" but it isn't passing my "sensitivity analysis" or my SWAG approach.

Three questions
1. Did the appraised value come below what was needed to make the loan work?
2. What would your condition adjustment be?
3. How did you come up with your condition adjustment?

 

[timd354]

the perfect appraisal in the perfect market would have no adjustments. you probably believe since there is a 100 sf difference in GLA there should be an adjustment. or we could use fannies insane 100 per sf adjustment even though the sale price includes land.

What are you talking about?

You should not assume that others are as clueless as you. $100/sf for the appraisal of some properties would be absurdly low...it depends on the market.

I don't believe that for most properties a 100 sf difference in GLA would warrant an adjustment (although it might, depending on the size of the property and the market, i.e. a 500 sf condo unit versus a 600 sf condo unit in Manhattan city would probably require a very substantial GLA adjustment). I also do not pre-judge the amount of the GLA that is appropriate. In some markets a $5/sf GLA adjustment may be appropriate and in other markets $500/sf may be appropriate). I know that I have personally adjusted GLA for as little as $10/sf and as high as $750/sf and in both cases had ample market data to back up the amount of my adjustments.

 

[timd354]

That is not what it says

Here is the direct quote from the OP in this thread:
"No condition adjustment was given because the condition of the comparable is assumed based on the information provided by the MLS listing sheets and not from first hand observation"
What do you think that statement means? RIF

 

[Michigan CG]

Just because there are different rating doesn't mean there is an adjustment. .

You aren't serious?

 

[Ariba]

If I have two properties that are basically the same and one sells for, say, $220,000 and the other sells for, say, $210,000 there very well could be a basis for a condition adjustment. I find in tract built housing IN MY MARKET a $10,000 adjustment attributable to condition very common and supportable. Failure to make an adjustment when the appraiser uses different condition ratings would be a big red flag here. It also would be grounds for a user of appraisal services to seek another more experienced or seasoned appraiser.

Can you make an $10,000 adjustment in the grid and still have the property rated in the same C category?