This is a pretty niffty detailed chart for finding time adjustments, we are done.

[Fernando]

Does 1-3 demand we document those conditions in our reports? I mean a lot of us studied the market conditions from the MLS, from reports (we have something called the Skyline Report here), from other sources. Personally, in NE OK, I run the entire MLS dataset excluding homes under $30k and over $1M and have a spreadsheet by date and price and do a trendline. But I don't include it in the report. In NW AR I am more likely to use it city by city but same metrics. It's not like we didn't know what the market was doing, it was that we did not document it per se in the report.

So, question 2. I am not a believer in micro-market analysis. Meaning I don't believe that Subdivision A is increasing/decreasing while Subdivision B is moving in the opposite direction when they are in the same market. I might see differences in lakeside mansions and manf. home prices out in the hinterlands, but both 99% of the time seem to be going the same direction for the same reasons (interest rates and the economy.) So, at what level is the analysis most valid? City wide? County wide? MSA wide? MLS wide? There seems to be a fixation upon census tracts. Our census tracts haven't changed since the 1980s yet the demographic are wildly different. What good is a census tract?

So, if the appraiser doesn't know by which measure the FF FHA wants to measure us, how do we know?

Fannie gave us broad discretion in how we prove our market conditions and report it.
Unlike ANSI, which is too detailed, arbitrary, and unnecessary.

 

[alebrewer]

It’s not an evasion at all. Tools for appraisers to use for market analysis have been around a very long time. There is nothing in the announcement that requires any changes to the tools that have been available for a long time.

But your response wasn't/isn't related to the question posed - which makes it an evasion. You're creating a straw man where there is no need. The question was: Do you think the new offerings by those who wish to help appraisers comply will look much like the 'suggested' example proffered by the GSE's...

 

[alebrewer]

So, question 2. I am not a believer in micro-market analysis. Meaning I don't believe that Subdivision A is increasing/decreasing while Subdivision B is moving in the opposite direction when they are in the same market. I might see differences in lakeside mansions and manf. home prices out in the hinterlands, but both 99% of the time seem to be going the same direction for the same reasons (interest rates and the economy.) So, at what level is the analysis most valid? City wide? County wide? MSA wide? MLS wide? There seems to be a fixation upon census tracts. Our census tracts haven't changed since the 1980s yet the demographic are wildly different. What good is a census tract?

Here's an example of divergent markets within the same zip code. First graph is homes between 1000' and 1400' and YB 2020+. Fairly stable with a very modest indication of improvement. Second graph is for $500k+ homes - Very clear upward trajectory. Both were from the same time period.

 

[Joe Flacco]

Different segments definitely do not move in the same direction at the same rate.

 

[meatsandbounds]

Pretty soon, there will be a hundred people left appraising, and 10,000 people looking over and nitpicking their reports.

I do look forward to having less competition.

Since all revision requests I’ve received so far have been small clerical things or the underwriter not reading fully, I’ll take the nitpicks, cause I’m still one of the best in my service area doing quality, well researched reports

 

[alebrewer]

I do look forward to having less competition.

Since all revision requests I’ve received so far have been small clerical things or the underwriter not reading fully, I’ll take the nitpicks, cause I’m still one of the best in my service area doing quality, well researched reports

Sure hope you don't have short arms...

 

[norapp]

Crazy. The market does not work like that, and how in the world did they chart it anyway? MV is the VALUE, not a stand-alone price affected hourly or by the minute, like the stock trading.

The additional content in the article explains why they are drilling down on time adjustments and that (according to them ) too a small percent of appraisals have them. ( why would you adjust in a stable market-) - it goes on to explain how not making enough time adjustments leads to underappraisal in minority market areas.

What the heck is appraising, and why are they also not concerned with appraising, which seems far more prevalent? Under apprising compared to what? What benchmark is for there for that?
I am no Trump fan, but his voters ( or appraisers in general) might want to bring it to the attention of the new admin wrt this in reining in the worst of DEI policy - the entities seem like they are trying to bend appraisals into higher values in minority areas - MV is MV -if they want a different kind of value then come out and declare it. The reference is about how they are going to look for adjusting or similar verbiage for age or location!! The market recognizes different ages when it affects value, and location is a critical component of value.

Properties are not automobiles that can be valued by set charts and numbers like a blueprint for automobiles, but they are trying to make it that way. RE is long life, not like a car, and it has many influences-some of which can not be standardized.. REis anchored to location, a fixed location and its influence is a key component of RE.

I just received a revision request. They wanted to know why no market adjustment was made for a sale that went into contract 9 months ago and sold 7 months ago. The market is stable which is reflected on page 1 and in the MC report. What is wrong with these people. Everyone wants sales within 3 months and an explanation as to why there are none??? or why they were not used. This business is starting to look like crack on steroids. I have been doing this since 1996. I don't know how much more I can take. Also have a lender that wants pictures of attic and crawls on every appraisal. And I have to fight for every dime I get as a fee which has not gone up but down.

 

[Terrel L. Shields]

Different segments definitely do not move in the same direction at the same rate.

But generally speaking, they do usually move in the same direction. Just not the same rate. Price inflation is deeply affected by interest rates and the economy regardless what the price level is.

 

[Terrel L. Shields]

Everyone wants sales within 3 months

With the paucity of sales, rural appraiser are scouring the countryside for ANY sale and the change in prices is generally substantially less than 1 percent per month.

 

[alebrewer]

But generally speaking, they do usually move in the same direction. Just not the same rate. Price inflation is deeply affected by interest rates and the economy regardless what the price level is.

Philosophically speaking, shouldn't demand for inferior goods rise as purchasing power decreases (think butter and margarine for example)? So that, homes that would typically be in demand when purchasing power is higher would experience a decline in demand when purchasing power decreases? If that is the case, in times of relatively low purchasing power, the price of lower priced homes should rise while the price of higher priced homes should fall. I know that is an oversimplification, but valid nonetheless...