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Pending sale placement

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William jackson

Sophomore Member
Joined
Jan 14, 2003
Professional Status
Licensed Appraiser
State
California
I am doing a (sale) appraisal on a SFR. Comp #1 is a very similar comp nearby. The next most similar comp is a pending sale one street away . Can I use it as comp #2 if I include 3 more closed sales for a total of 5 comps. Or should it be comp #5.
Thanks, William
 

Dee Dee

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
William,
I like to keep my under contract comps as #4 or higher if needed.
My experience has been that the underwriters want to see closed sales first, since under contract may or may not close and because most realtors are unable to disclose what the actual contract sales price is.
 

sueinprescott

Sophomore Member
Joined
Feb 10, 2003
Professional Status
Licensed Appraiser
State
Arizona
even as a 4th comp, being "next" to most similar, it's still doing its job. I keep pending/listings at 4th etc. for reasons Dee Dee mentioned. Pendings aren't as reliable.
 

Tim Hicks (Texas)

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Texas
Never as one of the primary three. Plus, what if it sold for much less than list price? There is nothing more embarrassing under review when you relied on one price and found out the actual price was much lower.
 

Ed Potrafke

Sophomore Member
Joined
Dec 17, 2002
I call the realtors involved with the sale, and usually one of them will let me in on sales price, and what not.
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
William, .....As the others have said, your primary 3 comps are expected to be closed sales. The pending sales are good back-up in the #4 / #5 positions. Still attempt to attain verifiable final price agreed-to by both parties from an agent (or both agents !) and any pertinent details about possibility of selling concessions influencing that price, financing terms and an expected closing date. With good supporting info these pending sales are as good as sold and are helpful in presenting a current pulse of the market, especially if some of your primary sale comps have sale dates older than you might prefer. I always track the listing history of my comps and note the % of the original list price which that final price represents. Some listing agents start out with rather bold offering prices, only to face the eventual realities of the marketplace as price reductions surely can follow over course of exposure time. Not uncommon to find consecutive and over-lapping listings before finally closing a deal, and often with the same agent. The buzz-word is "New" listing. Whatever it takes to catch one's attention. Those impressive 17 DOM postings are sometimes really 197 DOM, etc. Just the facts, please, just the facts.
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
If you have three closed sales then make the pending comp #4. If you have less than three closed sales it could be one of the primary three on the URAR but needs explaining. In some markets there might not be three closed sales.

Realtors® in my market will not disclose the contract amount on pendings, violation of code of ethics under confidentiality...or so they say!
 
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