The word "Average" in the improvements section - possible bias?

[DWiley]

If your variables have a wide range of values or varying scales, using relative ratings can help normalize the data. This is particularly true for condition and quality ratings. On the other hand, absolute ratings are not very useful unless you evaluate properties in a uniform neighborhood. Some sort of percentage transferred into the English language is preferable.

If one is using a varying scale, then one is not really using an absolute scale. You make a fair point about having useable data.

As you noted in a previous post, the GSE ratings were designed primarily for the GSEs to evaluate property eligibility. As such, they alone are not a good basis for extracting or supporting condition adjustments. That is perhaps why some appraisers have developed and apply their own absolute rating system for that purpose.

I saw a particular good (IMO) system where an appraiser answered a series of questions about the individual elements of the property and those answers were then transformed into a numeric rating. It was a very objective way to consider condition and derive condition adjustments, and it produced data could be used and re-used in lots of different assignments without the need to recalibrate to the condition of the subject property. That appraiser did a similar thing for quality.

 

[Tom D]

are we talking about situational ethics depending on the situation.
Dwiley, Mejappz, must right a philosophical report. i can barley understand your posts. doesn't mean you are wrong, can't argue with what i don't understand. but a remod can be a variable, a renovation is not a varible condition. new is not a varable condition also. am i seeing the light. average is a variable word being used wrongly in a new house, but it is wrong. CU will pick that up and there may be a CU comment there about it being wrong.

 

[DWiley]

Post #112:
The problem with "average" as used in appraisal reports is that appraisers do not use it in the same way. Some use an absolute rating and some rate based on what is "typical for the area." That is why we see brand new homes with the carpet, walls, etc, rated as "Average" because the appraiser claims it is "average" for the area.

IMO-the kiss method has always run true, Superior - Average - Inferior - talks as much about the comps, if not more than the current rating system. It would not be all that hard to understand those meanings as simplified. The grade school method generates more Q&A because of the way it was set up. I will never forget one reviewer's question about a "toilet" on a phone conversation; her- I can't believe I'm calling you about a "toilet", what can you tell me about it?? My first response was....it flushes away that which is not needed. What was the purpose of the call?? I think a 2-year-old understands what a toilet does - How does one recalibrate a toilet rating??
The modernization of Appraising needs to be simplified apparently.

If the subject is in C6 condition, then lenders and GSEs need to know that. If the comps all say "Avg" condition because they and the subject are both in C6 condition, that just isn't useful for risk analysis - which is the primary purpose of the appraisal report for those who use those reports in lending.

 

[Fernando]

the new 1004 is an expanadable form to add information at the spot you are on, less addendum comments.
new form, or not, if you can't figure out the condition, fannie can figure it out now. they will put you on bad list. bye bye to all the stupids..

our group may survive the death spiral already here. less appraisers, less competition, better fees. just getting a new form will be a price increase.

When I do my reports, I always try not to use addendums. Too distracting and some not bother to read.
I see the new 1004 understands an easy readable report are the better reports.

 

[djd09]

rating system...no problem...1-10...1 is the worst...10 is the best...5 is average...

 

[Fernando]

are we talking about situational ethics depending on the situation.
Dwiley, Mejappz, must right a philosophical report. i can barley understand your posts. doesn't mean you are wrong, can't argue with what i don't understand. but a remod can be a variable, a renovation is not a varible condition. new is not a varable condition also. am i seeing the light. average is a variable word being used wrongly in a new house, but it is wrong. CU will pick that up and there may be a CU comment there about it being wrong.

Hard to follow you. I thought it was a longest sentence . And some criticize reports for being all Capitals.

 

[RCA]

It is actually far easier to produce objective and meaningful analysis from absolute ratings than it is from relative ratings.

That just shows how little your organization knows.

But figure it out yourself, I don't want to waste too much time talking to a dumb wall.

 

[RCA]

If one is using a varying scale, then one is not really using an absolute scale. You make a fair point about having useable data.

Good grief, the SCA depends on comparables, which implies market area and neighborhood. All adjustments are made with regard to comparsions in that domain. "Absolute' is irrelevant. Appraisers do good to know the market area. They shold be able to rank the subject in the market area good enough. The condition of the kitchen is better than about 80% of the other homes in the market area. They know that, they can vouch for that. But absolute. WTF is that?

And after all this time as an appraiser you haven't figured that out. No, Dan, I would have to vote that you have done very little real analysis of real estate!!!

As you noted in a previous post, the GSE ratings were designed primarily for the GSEs to evaluate property eligibility.

Your organization needs to adapt to relative market area conditions. - Because an auditor can indeed objectively verify the truth (+/-) of your claims if you restrict the universe of condition and quality scores to a market area.

The blind retard ****er going through the girl's shower room, shouting, "Close your eyes, girls, I'm coming through."

To me your statements show a total lack of appraiser competence. You're too wrapped up in your organization with high-paid dummies.

As such, they alone are not a good basis for extracting or supporting condition adjustments.

Well you admit it. Why are appraisers expected to deal with these so-called absolute standards then?

That is perhaps why some appraisers have developed and apply their own absolute rating system for that purpose.

How about their own relative standard? That is what regression wants, it is what regression needs. Its universe is the market area. It does not see beyond.

I saw a particular good (IMO) system where an appraiser answered a series of questions about the individual elements of the property and those answers were then transformed into a numeric rating.

That system is, however, entirely subjective. Yeah, run around in circles.

It was a very objective way to consider condition and derive condition adjustments, and it produced data could be used and re-used in lots of different assignments without the need to recalibrate to the condition of the subject property. T

We know it isn't. The appraiser has to create the score subjectively. Of course, from the appraiser's perspective, if we can assume the appraiser is objective, if not 100% bright, this would be an improvement.

But "objective" means that a third party, e.g., the computer and regression, can at least constrain the process to protect bias from entering the result or final value conclusion. I am not going to completely connect the dots for you.

That appraiser did a similar thing for quality.

Of course.

 

[Tom D]

Hard to follow you. I thought it was a longest sentence . And some criticize reports for being all Capitals.

maybe i'll just do a line a post instead.
i've gotten lazy with the capital letters. fast typer, but faster ignoring those caps. with me it's productivity. maybe not useful, but saying it faster.
i know you were a regression major in college.
hard to understand philosophical appraisal thoughts being a math major, it's a different side of the brain. but have no fear king, just let the masses mumble on.

 

[Dale Floyd]

There are forces around us who have become more political than practical, so everybody had best beware. They no longer preach accuracy in the appraiser's opinion anymore, because the value may be correct. It's all about the verbiage. We were once taught "support" in our exhibits. Now, they want "evidence". Remember, your opinions must not be in variance to their opinions. Use the wrong word, and there will be a new section added by non-appraisal groups to beat the appraiser into submission.

There are also some who cannot accept the general understanding of "average". I guess we shouldn't feel too bad about that, because there are also some who cannot accept the general understanding of "woman" either, which befuddles me. I guess we are still needing to define what "is" means in our narrative reporting as well.

There are many things happening to the appraiser's profession these days, and the majority of it is nonsense that only puts targets on us and does NOT help us. We all need to be very careful I suppose.