Unadjusted values don't bracket the subject's value

[J Grant]

If I have "more similar" properties then what utility does presenting less similar properties in the report add to my analysis?

There's a distinction to be made between actually analyzing the market from the outside-inwards vs the final comp selection we present in our reports. The macro analysis is supposed to occur prior to the final selection.

These other arbitrary machinations contribute to the fallacy that the appraisal hinges solely on the 3 or 5 sales presented as comparables in the report, and that all we have to do to get a different value conclusion is to swap out a couple of those comps in favor of other sales with different pricing.

The report conveys the manner and extent of the development; it doesn't drive the development.

Overall I agree; however, the OP's first post said he made ALL downward adjustments - which meant ALL his comps were superior - Were more similar comps available? He didn't bother showing up to respond to that question.

Sometimes we bracket to get the adjustment o/market response to one key important feature - a lake view, a pool, or a negative, backing up to a dump.c.

At the very end, I will often do a price search - because 1) It sometimes brings up a missed sale ) and 2 ) it can put the subject value in the context of what else is or was available for that $ range?.

 

[shrubberyvaluation]

If the appraiser, such as in OP example, uses all superior comps and adjusts down, then they did not use the most similar - bracketing means lazy or agenda-driven appraisers have to search for the most similar sales- if is not be in the certs but many lender clients ask for it or will send a report back that is all up or downward adjustments -

The reason for bracketing is it is a very good and reliable way to find the value, what the market is paying for same/most similar, and then inferior and superior.

The most similar available may all be a little superior.

 

[J Grant]

The most similar available may all be a little superior.

Howe little? If it warrants an adjustment, is it little ?

All of this takes sound judgment of course -

 

[Overimprovement]

I've appraised one bedroom homes in markets where there aren't any others. How far out (50 miles?), or how far back (5 years) should we go to meet some arbitrary guidelines? Sometimes, especially in rural or lightly populated areas, our subject simply is the best or worst of its peers. I won't change the definition of peer in exchange for not calling something the best or worst in the area/style/etc. Especially if other areas clearly support the adjustment made for whatever feature(s) is/are in question that is causing the same direction adjustments.

Bracketing is in the same vein as no across the board adjustments. If forcing another comp to have subject 'bracketed' results in gross adjustments that are 3-5 times as high as the comparables used in the report, then IMHO, it is no longer comparable, and has no business in my grid.

I've always appraised this way, and never had any issues. A few questions/requests along the way, but minor, and easily explained to underwriters' satisfaction.

 

[Carnivore]

I've come in at zero (and in the comments it was less than zero). C4 homes in area selling for $30K, subject was deep C6, needing $50K (everything really) just to get to C4, so razing was the only possibility, but that cost $8K and the lot was only valued at $3K, not to mention $3500 owed in property taxes.

Bracket that...

Looks like above the Municipality will take possession and Habitat for Humanity will get a the Property for free. Thus creating a new homeowner/tax payer.

 

[Mike Ault]

Particularly egregious are the "reviewers" who demand that you "expand search parameters as far as necessary" to bracket a particular amenity. I typically land pretty hard on them for the betterment of the profession.

 

[Overimprovement]

Looks like above the Municipality will take possession and Habitat for Humanity will get a the Property for free. Thus creating a new homeowner/tax payer.

In the 3 main areas I have worked in the last 10 years, I've not seen that done once. Properties basically sit vacant until burnt to the ground by inexperienced drug users or until it rots to the ground after decades of decay. Typically, HFH has some restrictions on where it will build. Heck on this particular one, even several multi-family properties were vacant and decaying within 1/4 mile. Unless Disney World Ohio comes to the area, this will likely never change.

 

[J Grant]

I've appraised one bedroom homes in markets where there aren't any others. How far out (50 miles?), or how far back (5 years) should we go to meet some arbitrary guidelines? Sometimes, especially in rural or lightly populated areas, our subject simply is the best or worst of its peers. I won't change the definition of peer in exchange for not calling something the best or worst in the area/style/etc. Especially if other areas clearly support the adjustment made for whatever feature(s) is/are in question that is causing the same direction adjustments.

Bracketing is in the same vein as no across the board adjustments. If forcing another comp to have subject 'bracketed' results in gross adjustments that are 3-5 times as high as the comparables used in the report, then IMHO, it is no longer comparable, and has no business in my grid.

I've always appraised this way, and never had any issues. A few questions/requests along the way, but minor, and easily explained to underwriters' satisfaction.

as i said, judgment comes into play...if bracketing leads to crazy high adjustments and a misleading report clearly it should not be done

In my experience those situations are rare - usually, the appraiser is lazy and did not search enough or is trying to push a value and not bracketing helps that agenda - as does making an artificially small adjustment for a very superior location or feature that commands a lot more $ in the market than they adjusted for -

 

[Mike Ault]

as i said, judgment comes into play...if bracketing leads to crazy high adjustments and a misleading report clearly it should not be done

In my experience those situations are rare - usually, the appraiser is lazy and did not search enough or is trying to push a value and not bracketing helps that agenda - as does making an artificially small adjustment for a very superior location or feature that commands a lot more $ in the market than they adjusted for -

Heroic bracketing attempts also makes properties appear more conforming to their immediate market area than they actually are. If you are appraising an outlier, it should be clearly identified as such, and throwing in comparables from other areas simply to bracket something tends to obscure that.

 

[George Hatch]

If the only reason to include a sale is for bracketing purposes then it becomes appropriate to explain it that way.

S#5 is not among the "most similar sales" and is given no consideration in my analysis but is included in this report for the sole purpose of meeting the lender's requirements to bracket the subject's attributes. ​

The kids are calling it "malicious compliance"