Selling Guide Announcement (SEL-2024-07)

[Dublin ohio]

Since Fannie gave the go ahead to use macro data for market conditions, this is what you get from a recent appraisal I saw. Appraiser called the market stable in the subject's neighborhood based on this. The Columbus MSA is large and includes my neighborhood which has a median sale price around $750K. Subject's median is about $200K and is located in a small first ring suburban city. I did a quick matched pair and it showed a 9% annual increase. Same with 12 month analysis. MSA has prices from $75K to $5M or more

 

[Joe Flacco]

Metro area is too big.

 

[Dublin ohio]

Metro area is too big.

Agreed, but it has been made acceptable. So CU is getting populated with that type of data, which could be the very reason that Tom4value got this in the " I am right, right" thread he stated

Did an appraisal in May. Had to make significant positive market adjustments my data made it clear. They came back with CU findings that said I was too high. I responded with a detailed explanation of my data. They were impressed and accepted the report.

Fast forward to now. Their investor have problems with CU with my market adjustments, with CU. I responded and noted that it was the investor. I responded that my comments supported my findings and I wouldn’t change my report based on CU findings based that didn’t provide any data to support I was wrong.

I was right to even respond, right?

 

[Joe Flacco]

I just want them to acknowledge that the issue is super complex. With or without tools. Their attitude on the topic raises major red flags with their avm and waiver program. It just screams they don't know what they are doing.

 

[Tim Hicks (Texas)]

The instructions for the 1004mc states that if you deem the data to be unreliable or a lack of data, you must provide additional data to support market trends.

Don't give up Tim, i believe in you. You got this. if zillow can do it, you can too

The point is that Fannie and Freddie want the fit the market conditions into a cookie cutter mold just like they think that all sales are cookie cutter sales. This simply just is not the case in many instances. Rural properties, odd ball properties, properties with no updates, properties that completely remodeled are a fair share the assignments I get.

Market trends for 600 sf barndominium on 10 acres is impossible as much as the 4000 sf barndominium on 15 acres. Or the 1960's 800 sf house on five acres when all you have are much newer, larger home sales and you have expand 10-20 miles just to find like/kind properties. Or the house with guest quarters...house with tennis courts...house with a hangar, etc, etc.

 

[Fernando]

I did appraisals in Bert's town in 2022. I wasn't aware of price decreasing but assessor lowered the property tax during certain quarters.
Assessor has mass data and saw the blip. Since then property tax back to normal increase.
Point is it's hard for appraisers in real time to see the changes.
Assessors with their mass data able to see the subtle trend.

 

[DWiley]

The point is that Fannie and Freddie want the fit the market conditions into a cookie cutter mold just like they think that all sales are cookie cutter sales.

I don't know anyone that wants that, and I don't know anyone who thinks that it is always simple or easy. It can be very complex, especially for homes with a unique market segment.

I do know that there are a lot of good tools out there that allow for some pretty complex analysis to be done very quickly. I know that because they existed when I was in the field and I used them. When I would teach classes I would often demo such tools at breaks.

I also know, based on personally looking at a lot of reports, that there are still many who don't use such tools, and there are some who use tools but still try to twist the results into a stable indication virtually every time. Prices keep changing, but they keep marking stable.

 

[J Grant]

I don't know anyone that wants that, and I don't know anyone who thinks that it is always simple or easy. It can be very complex, especially for homes with a unique market segment.

I do know that there are a lot of good tools out there that allow for some pretty complex analysis to be done very quickly. I know that because they existed when I was in the field and I used them. When I would teach classes I would often demo such tools at breaks.

I also know, based on personally looking at a lot of reports, that there are still many who don't use such tools, and there are some who use tools but still try to twist the results into a stable indication virtually every time. Prices keep changing, but they keep marking stable.

What, in your opinion, are several good recommended tools?

If an appraiser runs stats and marks trends on page one as declining, but the subject smaller relevant market segment is rising, can both be used and appraiser explains why the overall trend was marked declining on page one but rising for the subject niche trend ( the comps and listings should support it of course ) Or must they always match? ( or just use the subject declining trend and comment that the overall market is rising but the subject declining because that market segment is suffering because of X )

 

[Tim Hicks (Texas)]

I don't know anyone that wants that, and I don't know anyone who thinks that it is always simple or easy. It can be very complex, especially for homes with a unique market segment.

I do know that there are a lot of good tools out there that allow for some pretty complex analysis to be done very quickly. I know that because they existed when I was in the field and I used them. When I would teach classes I would often demo such tools at breaks.

I also know, based on personally looking at a lot of reports, that there are still many who don't use such tools, and there are some who use tools but still try to twist the results into a stable indication virtually every time. Prices keep changing, but they keep marking stable.

Funny you should say that. I have had True Tracts tell me on several properties there is not enough data to determine market conditions at one to five years.

 

[DWiley]

What, in your opinion, are several good recommended tools?

If an appraiser runs stats and marks trends on page one as declining, but the subject smaller relevant market segment is rising, can both be used and appraiser explains why the overall trend was marked declining on page one but rising for the subject niche trend ( the comps and listings should support it of course ) Or must they always match? ( or just use the subject declining trend and comment that the overall market is rising but the subject declining because that market segment is suffering because of X )

I cannot recommend tools, for several reasons, but chief among them is that there is no one best tool. I used to use a very good tool, but it did not work with some MLS systems. The appraiser must determine which tool works best, given the data resources in his or her area.

The trend for a particular sub-market can certainly differ from the trend for a broader market. I have seen geographic neighborhoods where multiple sub-markets within that neighborhood were all experiencing different trends at the same time.