Subject condition

[RSW]

The market usually just pays a bit less and replaces it, but the concept with FHA is that the borrower will not be able to afford any costly repairs to the home

That would mean that the subject is something less than average. Right?

 

[Couch Potato]

If Greg is correct, I incorrectly used "Average-" in the sales comparison analysis. My problem with saying that it's average is that the property is not in average condition for the market. It is not average to have very stained and worn floor coverings and large holes in the interior walls.

I know FHA standards have changed, but I don't think they intend for us to give an "As Is" appraisal with large holes in the interior walls. Small holes I can see, but not large ones.

 

[ZZGAMAZZ]

So instead of being a proud, and possibly first-time, home owner of a property with holes in the wall, the individual continues to live in an apartment and is excluded from the American Dream, while the volume of vacant REO's continues to increase exponentially.

I do not propose an egalitarian scenario; however, the current system isn't working--ISN'T WORKING--because the marketplace for the tens of thousands of properties with deferred maintenance isn't operational. I'm marginally familiar with 203K loans but my knowledge as an appraiser doesn't move the market.

 

[timd354]

So instead of being a proud, and possibly first-time, home owner of a property with holes in the wall, the individual continues to live in an apartment and is excluded from the American Dream, while the volume of vacant REO's continues to increase exponentially.
quote]

The first time homeowner who likely cannot afford to repair a property with a large amount of deferred maiantenance is better off to continue renting and save a little more money until he can afford a property in good repair. Its not an appraiser's job to figure out how to get a lender to approve a buyer's loan, it is our job to evaluate the collateral in an ethical and competent manner whole following USPAP and any applicable supplemental standards. Your attitude is exactly the type of attitude that has led this industry to point where it is now.

 

[ZZGAMAZZ]

Point of order: My professional involvement is purely objective and impartial. (Personally I think the current housing crisis is a hoot.) However, from a macroeconomic perspective a more functional marketplace that better recognizes the particulars of the current supply might help achieve equilibrium.

 

[Couch Potato]

Rent them out.

So instead of being a proud, and possibly first-time, home owner of a property with holes in the wall, the individual continues to live in an apartment and is excluded from the American Dream, while the volume of vacant REO's continues to increase exponentially.

I do not propose an egalitarian scenario; however, the current system isn't working--ISN'T WORKING--because the marketplace for the tens of thousands of properties with deferred maintenance isn't operational. I'm marginally familiar with 203K loans but my knowledge as an appraiser doesn't move the market.

Yes, the number of vacant REOs continues to grow. Some lenders really ought to consider getting into the property management business. I think renting out a property is a much better prospect than selling it in this market.

 

[timd354]

Point of order: My professional involvement is purely objective and impartial. (Personally I think the current housing crisis is a hoot.) However, from a macroeconomic perspective a more functional marketplace that better recognizes the particulars of the current supply might help achieve equilibrium.

Yes, but that more "functional" marketplace should not achived by encouraging appraisals to ignore deficient property conditions in the appraisal report.

 

[David S. Roberson]

Here's the picture; do you think this is average?

 

[Wayne Tomlinson]

I really like the effect of the mirror.

Sometimes you find a home that is not up to FHA standards.


At least in the old days I would have made a bunch of requirements, and then it would be average when it was repaired.

I have a problem with not being able to do that now.

The FHA program was intended to help the lower income folks to have a home that is Safe,Sound and Secure.

When that low income person gets a house as you are depicting, that aint what FHA wanted. They have no money to fix anything.

In an early training session when I went on the roster (when it meant something) about 1994, the Illinois director said that the average FHA buyer had less than $200 in the bank after closing. That likely has not changed.

Stick to your guns, if you get static, tell HUD, Pam and any one else who will listen, hopefully also can make a difference.

Wayne Tomlinson

 

[Couch Potato]

Here's the picture; do you think this is average?

That hole may be on the interior, but it is an exterior wall. I would not let that go through "As-is."