Residential Master File Appraisal? What is that?

[nachocheesefries]

Of course I could tell the client to pound sand because I have to properly identify the property being appraised per USPAP? However, I like this client and I would like to try and accommodate their request if possible. Is this a USPAP issue or is there a way to do this that I am unaware of?

Cookie cutter lots....one floor plan, new construction houses. The builder is going to build the same house on 3-4 different lots..NOT an entire subdivision. Unless we are getting super technical (which I am all for), the values will all be the same.

Although I want to help them...I am not inclined to value multiple lots without compensation. Is there any middle ground here? He is saying he doesn't want a legal? LOL I am not thinking that is going to work for me. How do you have an appraisal with no legal or lot identification?

 

[GWISC]

From what I remember, a master appraisal is for the lender to extend a loan to the builder/developer who is building several cloned houses within a short time period. Rather than doing an appraisal for each one, a master appraisal is completed and relied upon for the subsequent houses that are a clones as long as all other elements are identical or nearly identical. Seems to me there was a thread on this within the past year.

 

[nachocheesefries]

From what I remember, a master appraisal is for the lender to extend a loan to the builder/developer who is building several cloned houses within a short time period. Rather than doing an appraisal for each one, a master appraisal is completed and relied upon for the subsequent houses that are a clones as long as all other elements are identical or nearly identical. Seems to me there was a thread on this within the past year.

Thanks for your response. I am down with that but what do you report as the legal, address, plat, parcel ID, etc?

 

[Terrel L. Shields]

am not inclined to value multiple lots without compensation. Is there any middle ground here?

I saw this 15 years ago when I went back over that of a CR who did a "master" appraisal...but the FDIC pounded the lender over it. When lending upon multiple parcels over 4 units, a discount must be applied. Not a USPAP issue, but is a bank issue. I don't know if the appraiser got in trouble - I doubt it- but he was working with several million dollar lending portfolio and FDIC was not a happy camper with the bank. The CEO and the VP of Loans both resigned within the year.

For existing or proposed developments of five or more residential lots in a single development, the appraiser must analyze and report appropriate deductions and discounts. Appropriate deductions and discounts should reflect holding costs, marketing costs, and entrepreneurial profit during the sales absorption period for the sale of the developed lots.​

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Send to the lender and ask them how they escape this requirement.

 

[GWISC]

Found it. It is in this Forum under Urgent Help Needed. It is titled Like Kind of Appraisal started around August 20, 2020. Lots of discussion there

 

[Meandering]

I saw this 15 years ago when I went back over that of a CR who did a "master" appraisal...but the FDIC pounded the lender over it. When lending upon multiple parcels over 4 units, a discount must be applied. Not a USPAP issue, but is a bank issue. I don't know if the appraiser got in trouble - I doubt it- but he was working with several million dollar lending portfolio and FDIC was not a happy camper with the bank. The CEO and the VP of Loans both resigned within the year.

For existing or proposed developments of five or more residential lots in a single development, the appraiser must analyze and report appropriate deductions and discounts. Appropriate deductions and discounts should reflect holding costs, marketing costs, and entrepreneurial profit during the sales absorption period for the sale of the developed lots.​

​

Send to the lender and ask them how they escape this requirement.

and at more than 4, the appraiser needs to be a CG for the appraisal to be for a loan to the builder.

You can apply the discount as if all were going to be one sale, and can narrate a MV for an individual, as a "future" value after an expected completion date, with a statement that the others would be comparable to the one you narrate, and therefore should be within a similar price range, if competed as of the future date.

.

 

[TMG]

I framed tract houses from 1981 to 1991. Each tract had about 3 or 4 models, and the only differences were the roof framing to make them look different. Some gable, some hip, etc., etc. Did not affect cost too greatly.

 

[BRCJR]

The Appraiser can appraise one lot or lot with improvements. If the lender uses it improperly, using it to loan on more than 4 units without discount considered, it isn't an Appraiser issue. This would be a regulatory issue/violation.

If a lender can provide evidence, absorption rate via market analysis, that all units will sell in 12 months or less no discount is required.

 

[Sid Holderly]

On the legal description part. They are not likely split out of the parent tract yet. They may or may not have lot numbers yet. The legal would be part of xxxxxxxx ( Pt S26,T23N,R2)plus lot # or lot size and any other defining information. You may not even have a lot survey yet. All subject to final approval, subdivision, or what ever. It likely does not have a 911 address yet(this is added after buildings permits are issued here). If in an area of rectangular coordinated roads the address will be approximately (2354 E CR550S or 2354 E Springtown Rd, zip).

This report would not be for AMC or UAD work, You need good client instructions/interaction for these.

 

[sputnam]

Master Appraisals aren't as widely used as they once were. At one time, there was a form especially for it. The problem... well one of them.. is that often the appraiser's instruction is just to use a 'typical lot'.