Phil Crawford Podcast

[TerryRohrer]

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This sample report is concerning.

Not much way to critique anything. Are the Proximity Based Results the comps picked by HVE? If so, clearly bracketing doesn't matter. Is there an effective date? It appears they present garbage anyone can find, but don't hint at what is included in the valuations.

 

[Joe Flacco]

I don't understand the logic of why it picks the comps it does.

It's a 70's house on a half acre lot. The AVM "data from tax records" says it is 2,592 SF living area, but it is a split foyer, and the assessors building summary says 2,593 SF living area but 1,343 SF on the main level. The AVM doesn't know it is 1,343 SF with 1,200 SF basement.

Because of that, it looks like it selected these 90's and 2000's homes that are 2,000+ SF on two above grade levels. I am not sure if the AVM would have chosen those 2000's homes if it knew that the subject was actually 1,300 SF with basement.

 

[Joe Flacco]

Appraisal would probably throw these out. Then need to find a 70's home on a half-acre lot with a basement that is only about 1,300 SF on the above grade level.

 

[The Bob]

View attachment 95426

This sample report is concerning.

I could charge $75 for that and make coin. Max 20 min. to do.
Nice to see bracketing (GLA and Yr built) not required anymore.

 

[TerryRohrer]

Should be free for all(as we are having a free-for-all in real estate!).

We can't specify any additional assumptions or limitations, but below is the fine print at the bottom of the example. Sure looks like they believe themselves!

"VALUES ARE PROVIDED “AS IS” AND ALL USES ARE AT THE USER’S SOLE RISK. ALL WARRANTIES CONCERNING THE VALUES AND ALL UNDERLYING DATA AND PROCESSES BOTH EXPRESSED AND IMPLIED ARE EXPRESSLY EXCLUDED INCLUDING WITHOUT LIMITATION ANY WARRANTIES OF MERCHANTABILITY, ACCURACY, OR FITNESS FOR A PARTICULAR PURPOSE. The Values are calculated using various models and techniques proprietary to Freddie Mac. This report does not constitute an appraisal and has not been prepared by a certified or licensed appraiser. Values are dependent on the accuracy of any data supplied by the user. Values may not be used to produce or attempt to produce models used to generate the Values. The term Value is used in this report to mean the estimated market values generated by using the Freddie Mac proprietary models."

 

[TerryRohrer]

"Wow, touting the accuracy of their AVMs over the last 20 years, am I missing something?! Nine years ago, Congress effectively appointed FHFA as conservator (receiver) of Fannie Mae, Freddie Mac. On September 6, 2008, FHFA placed Fannie Mae and Freddie Mac into conservatorships. Subsequently, Fannie Mae and Freddie Mac, together, received $187.5 billion from taxpayers. So much for the effectiveness employed by Freddie Mac’s AVMs internally, for their own risk and portfolio management."

https://www.calypsoedu.com/is-freddie-macs-avm-eating-your-lunch/

 

[Joe Flacco]

Look at the comps it picked.

 

[CGinMN]

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Appraisal would probably throw these out. Then need to find a 70's home on a half-acre lot with a basement that is only about 1,300 SF on the above grade level.

3 Alderwood Pl sold for $375,000 and was a new construction. Easily sets the upper limit. The subject was probably worth $340,000, maybe less. Assuming they loaned at the point value of $389,041, LTV is already off by 10%.

 

[TerryRohrer]

Horseshoes and hand grenades, and such!

 

[Joe Flacco]

I would be looking at properties like these. 60's - 80's homes on half acre lots.