sales concessions do

[jwand125]

I am appraising a 80K home with 3k of closing to be paid by seller.
I did not adjust comparables because such a concession is the norm in the market place, i did verify comp data but no way of seeing Purchase agreements and concessions. Today ever sale has some sort of concession. I mentioned the concession but i am being asked why i didnt effect sales comparason? any help im new

 

[Anonymous]

If the comparable sales had sales concessions they would ,of course, be mentioned and reduce the effective sales price of the comparable. The concessions given in the sale of the subject are mentioned so that the lender can decide what to do with them. The amount of sales concessions does not have any effect on the market value of the subject, only its sales price.

 

[Atlanta CG]

In this last case, only if the adjustments were beyond what is typical. It is never a $ for $ adjustment and never always applied to reduce the net value of the comp....never-always, hmmm, from an english major.

 

[Ted Martin]

Was the sale price increased over the asking price for each of the comparable sales? If not then the seller participation was probably a concession granted by the seller to realize a quick full price sale of the comparable. In that case then there would not necssarily be a reason to make any adjustment. Because a seller concession of up to 3% is common (but not necessarily typical in my market) I will only adjust seller concessions which are greater than 3% and only for the amount which is above the 3%. It also matters which segement of the market you are talking about. At the lower end or my market a fixed dollar amount, say up to $1,500 may be more common that a percentage.