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

[Tim Hicks (Texas)]

So "fair market value" is biased and "low e windows" are biased???

 

[Tom D]

i would be terrified to use the word poor for any condition in a non white neighborhood being a cracker appraiser. they would accuse me of a hidden meaning about the neighborhood people. with a loco government the perception of, means found guilty.
i wonder how CU would react to unknown words being used in material description. carpet/normal wear. CU, what the he*l is that.

 

[Andee]

So "fair market value" is biased and "low e windows" are biased???

This is the type of crap we deal with on the daily. I get there is context to this but not to everyone, only people that know what Low E windows are, which is not the whole world, not even everyone in the US. I was also taught not to use "fair market value" when I was training and to use "opinion of market value", which is still subjective because it's my opinion based on some sort of analysis, but that doesn't mean the next guy is going to come up with the same value, or come close to the value I came up with. The next one may not see the need for an adjustment that I made, or they may make an adjustment that I didn't seem necessary.

They throw all these words out and tell us not to use them, but they don't supply us with anything suitable to use in their place. I guess we can start getting creative and see what they come back with in revisions and explain "Our hands are tied because the normal information I would supply has to many words that are taboo", which I'm sure I would get my hand slapped for using the word "Taboo" because some moron would take it in a "religious" context.

 

[Andee]

i would be terrified to use the word poor for any condition in a non white neighborhood being a cracker appraiser. they would accuse me of a hidden meaning about the neighborhood people.

Use the word dilapidated. I was in a neighborhood not to long ago with a house that needed to be razed, that was a lower income neighborhood. I basically kept using things like "major deferred maintenance" or "extreme damage" throughout the report. The detached garage was falling over for Pete sake, the floor felt like you were going to fall through it, it was horrible. I walked out of there seeing a little black mouse that was in a hall closet that came to see what was going on, he was actually kinda cute, but I wouldn't want him at my house, and about 14 chigger or flea bites up and down my legs. But, it was a foreclosure, they left everything, including a motorcycle, and the place was just gross, which was coming from the horrible smell, to see used adult diapers hanging out in the driveway. I think I put one in a picture and called it debris that needed to be cleaned up.

 

[DWiley]

So "fair market value" is biased and "low e windows" are biased???

FMV is not biased, it is simply incorrect. The IRS uses FMV; the GSEs use Market value - and the definition is provided right on the forms, so there is no confusion.

 

[djd09]

FMV is not biased, it is simply incorrect. The IRS uses FMV; the GSEs use Market value - and the definition is provided right on the forms, so there is no confusion.

Definition of Market Value​

Market value is the most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale

how many subjective words are included in that definition...lots

 

[Terrel L. Shields]

"fair market value"

Is a legal term, not a pejorative.

 

[Dale Floyd]

Do they? What, exactly, do you mean when you say something is in "average" condition? Is that "average" as defined in the MS handbook? Average for the area? Average for a home of that age and quality?

It has been my experience that there is not a universal application of that term. I have seen reports where an item very near the end of its life was described as "average" because the condition was "typical for the area." I have seen new homes where everything was rated as "average" because most of the homes around it were also new. My all time favorite was a statement that "the home is in average condition as compared to other homes in similar condition"

The term may certainly be used, but context needs to be provided so the reader understands what it means.
The reason it is cited in the Guide is not because of potential bias; it is listed because of the subjective nature of the term if context is not provided. The simple solution is to provide that context.

In school, there is a grade code that goes like this - A, B, C, D, F. Perhaps I'm overconfident, but I feel pretty sure that a parent reading the report card doesn't need to have a grading lesson to understand which one of those would be represented by the word "Average".

In construction, there are three grades of lumber that goes like this - #1, #2, #3. I doubt it takes a scholarly person to understand the word "Average" references #2 lumber.

Let me go just a little further. In appraisals, we grade the condition of a property as C1, C2, C3, C4, C5, C6. Whether we even use the word "Average" or not, that's exactly what the C3 and C4 ratings scream to anybody reading our reports.

People aren't stupid Danny, nor do they require a glossary for every single word we use in the Queen's English (southern style) within a report. I truly think you understand what "Average" means when you ask how a restaurant compares in an area from somebody with experience. I believe you can figure it out when you see various carpenters who build in an area, with average craftsmanship. Can't say church, can't say inferior, can't say average, can't say master, can't say homogeneous, and the list gets longer and longer and does NOT accomplish one single thing.

 

[DWiley]

In school, there is a grade code that goes like this - A, B, C, D, F. Perhaps I'm overconfident, but I feel pretty sure that a parent reading the report card doesn't need to have a grading lesson to understand which one of those would be represented by the word "Average".

In construction, there are three grades of lumber that goes like this - #1, #2, #3. I doubt it takes a scholarly person to understand the word "Average" references #2 lumber.

Let me go just a little further. In appraisals, we grade the condition of a property as C1, C2, C3, C4, C5, C6. Whether we even use the word "Average" or not, that's exactly what the C3 and C4 ratings scream to anybody reading our reports.

People aren't stupid Danny, nor do they require a glossary for every single word we use in the Queen's English (southern style) within a report. I truly think you understand what "Average" means when you ask how a restaurant compares in an area from somebody with experience. I believe you can figure it out when you see various carpenters who build in an area, with average craftsmanship. Can't say church, can't say inferior, can't say average, can't say master, can't say homogeneous, and the list gets longer and longer and does NOT accomplish one single thing.

The grade cards my kids got all included an explanation of what each grade meant. So that may not be the best example

If it is all as clear as you claim, why do I see so many reports for brand new homes where the condition of individual items is reported to be .... wait for it..... AVERAGE

 

[Fernando]

The grade cards my kids got all included an explanation of what each grade meant. So that may not be the best example

If it is all as clear as you claim, why do I see so many reports for brand new homes where the condition of individual items is reported to be .... wait for it..... AVERAGE

Are you saying new homes in reports are stating C4?