Subject as a Comp

[Illuminati]

Does anyone know what USPAP says for using the subject as a comp?

The underwriter wants it removed; however, I think it is necessary to produce credible results.

Subject sold 3 months ago in cash to mom, and now, it is being sold to her son.

I think it reasonable to have it in the report with appreciation applied, especially since 2 of the other closest comps bracket the adjusted value nicely.

Comp 1 after adjustments 389k
Comp 2 after appreciation $392k (subject)
Comp 3 after adjustments $394k.

Thoughts?

 

[glenn walker]

Does anyone know what USPAP says for using the subject as a comp?

The underwriter wants it removed; however, I think it is necessary to produce credible results.

Subject sold 3 months ago in cash to mom, and now, it is being sold to her son.

I think it reasonable to have it in the report with appreciation applied, especially since 2 of the other closest comps bracket the adjusted value nicely.

Comp 1 after adjustments 389k
Comp 2 after appreciation $392k (subject)
Comp 3 after adjustments $394k.

Thoughts?

Its not a USPAP Issue as USPAP does not address comp selection. -And Yes you can use it but I would only use it as a 4th or 5th comp as nobody will place any weight on it. Personally I never use a subject as a comp but thats a personal business decision you have to make.

 

[shrubberyvaluation]

Does anyone know what USPAP says for using the subject as a comp?

The underwriter wants it removed; however, I think it is necessary to produce credible results.

Subject sold 3 months ago in cash to mom, and now, it is being sold to her son.

I think it reasonable to have it in the report with appreciation applied, especially since 2 of the other closest comps bracket the adjusted value nicely.

Comp 1 after adjustments 389k
Comp 2 after appreciation $392k (subject)
Comp 3 after adjustments $394k.

Thoughts?

If its comparable sure. I wouldn't for example if its an extensive renovation now and was a fixer upper before. Locationally its the best, and probably physically unless there are additions or some other change in between. I would put it as comp 4 however.

 

[J Grant]

Its not a USPAP Issue as USPAP does not address comp selection. -And Yes you can use it but I would only use it as a 4th or 5th comp as nobody will place any weight on it. Personally I never use a subject as a comp but thats a personal business decision you have to make.

This topic has been covered often. I rarely use the subject as a comp and do so only in siutioans where subject was such a unique property with scarcity of similar sales it makes sense. .Otherwise is redundant, because we analyze a prior sale of subject in comments.

 

[shrubberyvaluation]

Its not a USPAP Issue as USPAP does not address comp selection. -And Yes you can use it but I would only use it as a 4th or 5th comp as nobody will place any weight on it. Personally I never use a subject as a comp but thats a personal business decision you have to make.

Why would you not put weight on it? Unless the property has changed its probably the best comp if its recent.

 

[shrubberyvaluation]

This topic has been covered often. I rarely use the subject as a comp and do so only in siutioans where subject was such a unique property with scarcity of similar sales it makes sense. .Otherwise is redundant, because we analyze a prior sale of subject in comments.

Not redundant. Sometimes there are property changes, and when there isn't, then it is further support and illustrates that by gridding it out and there may be changing market condition adjustments. The market could also react to features differently under current market conditions than they did during the prior sale.

 

[glenn walker]

Why would you not put weight on it? Unless the property has changed its probably the best comp if its recent.

The appraiser can place all the weight he/she wants to on it. And on a private or Non-UAD report I am more open to it. BUT If its in a UAD Report when it gets run through the system with that Subject and it also on a UAD Comp Grid the new report is going to blow the Big Green Machine up. Its almost a certain going to the review desk. I don't need any most headaches in life and as a former long time reviewer I learned there are certain things that will get you pulled over. Yes you may be fine but why create a situation where you end up jumping through hoops and writing rebuttals. I can think of 99 different ways to get to the same destination without getting pulled over. Again its a business decision.

 

[JeffSH]

Unless there is no market activity, it doesn't make sense to use the subject to value itself. J Grant has it exactly right. It's redundant.

Say the subject sold 3 times in the past two years. Most recent transfer was last week. You would never grid all three of the subject's transfers, adjust for time, and then call it a day.

 

[Terrel L. Shields]

Secondary market will not accept a subject as a comp except as a 4th - You need 3 comps that are not the subject. It does not matter what USPAP says.

 

[Illuminati]

We have 6 comps.

I was saying the best three comps including the comp as the subject...all adjust to similar amounts---right around $390k mark.

Sorry for the confusion.