Placing weight on PENDING SALES

[Fernando]

Past year I gave up explaining the listings. I just say the active/pending comps are listed below market and let reader figure it out.
I put the listings there because lender wants them.

 

[Tiffany Gibbons]

90% easily, almost all of them.

You ever check after it closed to see if they lied or didn't tell you about concessions? I've had agents and homeowners tell me all sorts of crazy high prices, I'll pull up the sold listing and show em what the listing they remember actually sold for. Lots of times, owners remember a high listing price and fixate on that if a house is nearby. Cause, Zillow included in their Zestimate.

 

[Yuanyin]

I had purposely checked on several but not nearly all of them. But I then noticed I'd see most of them again anyhow when I would complete another appraisal in the same area, and I'd see the closed price on MLS vs the price I used in Win-total via the Win-total smart exchange server which pulls up my previous use of the address and what I filled out on the SCA grid.

I found agents were exceptionally helpful and honest. I'm making those calls rarely now. As the market tightens up and values roll over I don't think agents will be as forthcoming.

 

[ucbruin]

I had purposely checked on several but not nearly all of them. But I then noticed I'd see most of them again anyhow when I would complete another appraisal in the same area, and I'd see the closed price on MLS vs the price I used in Win-total via the Win-total smart exchange server which pulls up my previous use of the address and what I filled out on the SCA grid.

I found agents were exceptionally helpful and honest. I'm making those calls rarely now. As the market tightens up and values roll over I don't think agents will be as forthcoming.

You're probably right....
Agents were proud to share the info....

 

[ZZGAMAZZ]

A standard statement I sometimes use may go something like, "Most weight was placed on x, y and z due to recent sales date, physical similarities, location etc, LESS weight was placed on comparables 4 and 5 since they are under contract without a settled sales price.

But I don't say no weight. What would be the point of using them at all then?

I say that the "Pending Sales that provided "Passive Support" (because of the uncertain eventual outcome) often depict the most accurate measure of market reaction, because the contract dates of pending sales typically are more recent than closed sales." [and then elaborate if the adjusted valules are remarkable different between the two types...]

 

[Tiffany Gibbons]

I say that the "Pending Sales that provided "Passive Support" (because of the uncertain eventual outcome) often depict the most accurate measure of market reaction, because the contract dates of pending sales typically are more recent than closed sales." [and then elaborate if the adjusted valules are remarkable different between the two types...]

What if the pending sale in question had an appraisal waiver?

 

[sputnam]

It's actually a violation on their part (least it was last I checked) for them to try to tell you how to reconcile.

 

[JeffSH]

I would never say I gave most consideration to a pending/listing....

Strong disagree. Pending sales are crucial in sharply increasing markets. If your time adjustments aren't based on today's pending contract prices, then you aren't providing the true value as of the effective date. You are providing a past appraisal based on when the last comp sold.

Contracts fall through in only 1/10 transactions. And I have data showing the ones that do fall through will go back under contract at a higher price within days. Contract sales are great data-points!

There is nothing wrong with givin the most weight to pending sales during reconciliation, as long as there are closed sales that also adjust to support market value. If you don't have closed sales that also support, then the adjustments are wrong or you are overvaluing.

In stable markets, pending sales aren't very relevant. In sharply decreasing market, the same thing above applies.

 

[ZZGAMAZZ]

What if the pending sale in question had an appraisal waiver?

Why would one assume that an arms-length transfer was influenced by the involvement, or non-involvmenet, of an appraisal?

 

[ucbruin]

Strong disagree. Pending sales are crucial in sharply increasing markets. If your time adjustments aren't based on today's pending contract prices, then you aren't providing the true value as of the effective date. You are providing a past appraisal based on when the last comp sold.

Contracts fall through in only 1/10 transactions. And I have data showing the ones that do fall through will go back under contract at a higher price within days. Contract sales are great data-points!

There is nothing wrong with givin the most weight to pending sales during reconciliation, as long as there are closed sales that also adjust to support market value. If you don't have closed sales that also support, then the adjustments are wrong or you are overvaluing.

In stable markets, pending sales aren't very relevant. In sharply decreasing market, the same thing above applies.

I just wouldn't say I gave it most consideration....