Time adjustments?

[Appraisal Santa Fe]

I just got an order for an appraisal I did on a property about 6 months ago. The only new comparables available are substantially larger and more expensive. I spoke to my client and they said I could use my prior comps but do some time adjustments.. Its been years since I did a time adjustment, can anybody refresh my memory on it.





RC
:new_newbie:

 

[Riick]

Define the area.
If:
Avg sale price 1/1/07 to 7/1/07 $300,000 (avg GLA 2,000 sq.ft.)
Avg sale price 1/1/08 to 7/1/08 $264,000 (avg GLA 2,000 sq.ft.)
Decline per month = ??????

then again

Avg sale price 1/1/07 to 7/1/07 $300,000 (avg GLA 2,000 sq.ft.)
Avg sale price 1/1/08 to 7/1/08 $264,000 (avg GLA 2,150 sq.ft.)
Decline per month = ??????

 

[Lee Lansford]

I just got an order for an appraisal I did on a property about 6 months ago. The only new comparables available are substantially larger and more expensive. I spoke to my client and they said I could use my prior comps but do some time adjustments.. Its been years since I did a time adjustment, can anybody refresh my memory on it.

C
:new_newbie:

Does the market provide any current offerings for sale and/or pending sales? If "yes", there's your start!

 

[Appraisal Santa Fe]

It's a tough area, this property is on the low end of the spectrum, most houses sell in the area are pretty big and high dollar. My research shows the area as stable (had to pull a 6M sale out as it tipped everything), so basically no change in the last year. Just fewer sales in a not very active area to begin with. Guess I'll just have to explain that no time adjustment was necessary. I'm putting two current listings in there to support value.

 

[xmmcsmielr]

Santa Fe,

If you have a sufficient number of sales that closed during the past two years in an Excel spreadsheet format or some format that will go into an Excel spreadsheet, like comma delimited, email the data base to me: RicardoSmall@Q.com, and I will return a trend line graph that will give you an indication of the change over time.

Also, it may be interesting to compare the number of current listings to the average monthly absorption rate over time, to see how long of a supply is available.

By the way the more details in any data base, like days on the market, listed prices, square footage, age, etc would be helpful.

 

[Mike Garrett RAA]

I would seriously consider doing a new appraisal. 6 months is a long time .... in this present market.

 

[KD247]

... The only new comparables available are substantially larger and more expensive. I spoke to my client and they said I could use my prior comps but do some time adjustments.. ...

Potentially sounds like a fishy request. Are you saying that no similar or inferior properties have been marketed in the last six months? Anywhere? If so, what happened with those listings?

With values sharply dropping in most areas, I'd really want the primary comparable sales to include recent data. If the lack of data forces you to use older sales, any time adjustments should be extracted from the recent data, compared against, but not based on, trending. (There's a problem with relying on trending when the data pool doesn't include sales that represent the market for the subject property. As values decline, and some properties prove unsalable at asking prices, there are certain groups of buyers that will pull their properties off the market rather than reduce the asking price. Trending of recent closed sales doesn't account for those groups of buyers, skewing the data.)

 

[Appraisal Santa Fe]

Thanks for the help all.
Ricardo, thanks for that amazing offer, I'm hoping I wont need that much info.

It's an order from a reputable client, nothing fishy. I'm doing it as a new assignment but have to use my same comps I used 6 months ago. I added a new comp that is over 3 miles away and explained it, plus two new listing comps.
I checked and many of the listings I used in the prior appraisal are still listed. Values are holding steady in the area but the DOM has increased quite a bit.


RC

 

[Caterina Platt]

Potentially sounds like a fishy request. Are you saying that no similar or inferior properties have been marketed in the last six months? Anywhere? If so, what happened with those listings?

With values sharply dropping in most areas, I'd really want the primary comparable sales to include recent data.

This appears to be an assumption made by many in the industry. Believe it or not, there are truly portions of our market that are not dropping.

 

[Appraisal Santa Fe]

This is one of those pockets that has not dropped (yet) It has few sales and the ones it has are usually over 1m.