Remaining Economic Life

[George Hatch]

Okay, but that still doesn't justify appraisers automatically skip even looking for land sales data and going straight to backing into land values and calling it extraction. To the extent that's what the CA means to some appraisers as a group then its no wonder they don't think the 15-second CA is credible. The way they're doing it isn't credible.

With all that said and regardless of what I do in my own work, I'm not going to hassle an appraiser for how they do their CAs unless the terms of the assignment include a request for land sales in support of a site value or some other specific that gets overlooked by the appraiser. At which point its the client that's imposing that requirement on them, not me.

I try really hard to make the distinction between the things I choose to do in my own work vs what's required of other appraisers in their assignments.

 

[alebrewer]

Okay, but that still doesn't justify appraisers automatically skip even looking for land sales data and going straight to backing into land values and calling it extraction.

Where do you even come up with this stuff? In your mind, I'm guessing... I've never - and I mean never - heard of anyone advocating for appraisers to automatically skip even looking for land sales. If you're aware of such a post, I'd REALLY be interested in seeing it...

 

[George Hatch]

So you've never seen appraisers do that? I have. Perhaps the majority of the time, even among 30+ year veterans who by now should know a lot better. I have a review client who requires gridded land sales analyses for all CAs, and you wouldn't believe the amount of push back I've gotten in trying to get them to meet the terms of their engagement. And every one of those appraisers are smart enough to know better; they just don't want to make the effort.

I'm also smart enough to never hassle them on the matter without having already looked for myself to see what data is available.

 

[Mejappz]

So you've never seen appraisers do that? I have. Perhaps the majority of the time, even among 30+ year veterans who by now should know a lot better. I have a review client who requires gridded land sales analyses for all CAs, and you wouldn't believe the amount of push back I've gotten in trying to get them to meet the terms of their engagement. And every one of those appraisers are smart enough to know better; they just don't want to make the effort.

Most likely staff appraisers working for John Brenan at Clear Capital.

 

[George Hatch]

I wouldn't know about CC and I doubt Brenan has been there long enough to change anyone's habits. One of the appraisers I was "repeatedly" going at it with over not meeting the explicit terms of their assignment was an MAI so your crack about it being AMC appraisers misses that mark, too.

"I'm not getting paid enough to do that" is a response I hope never to hear again from an appraiser who accepted an assignment with those instructions.

 

[alebrewer]

So you've never seen appraisers do that? I have. Perhaps the majority of the time, even among 30+ year veterans who by now should know a lot better. I have a review client who requires gridded land sales analyses for all CAs, and you wouldn't believe the amount of push back I've gotten in trying to get them to meet the terms of their engagement. And every one of those appraisers are smart enough to know better; they just don't want to make the effort.

I'm also smart enough to never hassle them on the matter without having already looked for myself to see what data is available.

In my role as investigator, I've seen appraisers who've said they've done something, when in fact they haven't ( extraction or allocation), but I've never seen any who has advocated for skipping the search for site sales only to actually perform extraction... That's just me though. I'd never deign to question your experience.

 

[Mejappz]

I wouldn't know about CC and I doubt Brenan has been there long enough to change anyone's habits. One of the appraisers I was "repeatedly" going at it with over not meeting the explicit terms of their assignment was an MAI so your crack about it being AMC appraisers misses that mark, too.

But they have friends in high places so it's all OK.

 

[George Hatch]

You seem to be engaging in some creative reading here. I never said anyone advocated that. Regardless of your feelz in this discussion, this is what I actually said:

"Okay, but that still doesn't justify appraisers automatically skip even looking for land sales data and going straight to backing into land values and calling it extraction. To the extent that's what the CA means to some appraisers as a group then its no wonder they don't think the 15-second CA is credible. The way they're doing it isn't credible."​

 

[George Hatch]

But they have friends in high places so it's all OK.

Maybe so, but it didn't alter what that appraiser (and a number of others who tried to do the same) ended up doing for that assignment.

Another example is when the assignment includes a request for Prospective Value into the future and explicitly says it's not acceptable to simply forecast the current value into the future without considering the market trends they expect in the future. Yeah, I get that nobody (including me) wants to commit to a value opinion in the future, but if it's okay for the client to ask that question then it's okay for the appraisers to take a swing at answering it, inclusive of their stated assumptions and limitations.

 

[Zoe]

All the recognized methods mentioned are good. I used to appraise several subdivisions for banks on the beginning of development. It was just vacant land and all I had was a plat map that had been approved. If you study enough sales, the land value to overall value ratio gets pretty close. Of course you have to consider location if you are jumping to areas that are not really competing with subject. Extraction is best bet then if you have no similar vacant sales. Income cap can work Vacant land is hard in some areas and a piece of cake in others.