STR Debate Finally Settled?

[Non Sequitur]

"The 1007 was not designed for appraising single-family properties that are used as STRs. Specifically, the 1007 calls for the “Indicated Monthly Market Rent.” This means the appraiser needs to analyze competing properties leased on a monthly basis. It would be incorrect for the appraiser to use STR comparables and then multiply the nightly STR fee by 30 to estimate a monthly rent. Such an approach would fail to account for FFE, other services, vacancy rates, and business expenses.

In summary, while a lender may choose to request a 1007 for an appraisal of an STR, in fulfilling the assignment the appraiser must use rental comparables with monthly lease rates to support the “Indicated Monthly Market Rent.” Alternative definitions and methodologies are not acceptable. Form 1007 cannot be used to estimate the nightly fee for an STR."

Have to scroll down to read the update:

Appraiser Update | Fannie Mae

Welcome to our June 2024 Fannie Mae Appraiser Update.

singlefamily.fanniemae.com

 

[Dublin ohio]

How long before we see another thread asking about STR comparable rents and the 1007. You know it will happen. Either many appraisers are not on Fannies E-mail list or they don't read them if they are.

 

[Non Sequitur]

How long before we see another thread asking about STR comparable rents and the 1007. You know it will happen. Either many appraisers are not on Fannies E-mail list or they don't read them if they are.

Or the "but it isn't going to Fannie" line.

 

[TerryRohrer]

Probably negotiated and coordinated with AMCs who have been creating their own forms to address the issues with the 1007. There will still be appraisers providing real estate appraisals of businesses, with unsupported short term rents on non-1007 forms.

 

[Non Sequitur]

Probably negotiated and coordinated with AMCs who have been creating their own forms to address the issues with the 1007. There will still be appraisers providing real estate appraisals of businesses, with unsupported short term rents on non-1007 forms.

No doubt.

I have a pre-foreclosure on my desk right now, Rocket Mortgage was the lender. I'm kicking the assignment back because the residential single-unit (as mortgaged) has two detached "units" (converted shed and a large boat) that were STRs. It's a tourist area but the income has dried up. Of course, "the last appraiser did it" is their excuse but I'm not getting involved in the mess.

 

[Dublin ohio]

Of course, "the last appraiser did it" is their excuse but I'm not getting involved in the mess.

So go hire the "last appraiser".

 

[Dublin ohio]

Clickforms has a str comparable rent schedule. Not really sufficient

 

[Surf Cat]

Where would the verifiable information be garnered from for that click forms Str form?

The MLS only lists "monthly" sfrs, condos, duplexes to four plexus. Airbnb & Vrbo lists and books the properties.... are these the sources one would use to input comparables?

I mean, you could garner all the information about the high and low seasons, the number of vacant days per month, and the expenses from the subject. But what about the comps?

 

[Dublin ohio]

Where would the verifiable information be garnered from for that click forms Str form?

The MLS only lists "monthly" sfrs, condos, duplexes to four plexus. Airbnb & Vrbo lists and books the properties.... are these the sources one would use to input comparables?

I mean, you could garner all the information about the high and low seasons, the number of vacant days per month, and the expenses from the subject. But what about the comps?

Property manager if there is one, owner if you can contact them. If I am doing a typical 1007 in my areas. MLS rentals are very limited. Always have to contact management companies or agent I know that work the investor market. I just posted the form for fyi. Form or no form. Getting str rental data takes the same due diligence

 

[Terrel L. Shields]

But what about the comps?

The biggest problem is that STR require segregating the income for the FURNISHINGS from the REAL ESTATE and the BEV. $30k in furniture is significant.