Underwriters and their hang up with Predominant Value

[Caterina Platt]

You have ALL missed the point. You have done a thorough job explaining the market conditions and why the subject falls outside the predominant range.

All they really want to see is a short statement by the appraiser that acknowledges the final value is outside the predominant range but marketability is not affected. (Unless, of course, it IS affected. If so, then you must demonstrate in the report what has to be done to cure that problem)

Hi Mike,

Actually, no. I didn't miss the point. The addendum is long gone, and there wasn't any discussion as to 'why do they need that???' You and I both know it's probably a check box mentality issue that won't change with any amount of discussion at the level with which I was dealing.
However, MY point was this. When the weatherman states that we are in for clear skies, and a sunny, hot, day, why is it then necessary for someone to pipe in and demand the percentage for the chance of precipitation? It's because they've not been trained to comprehend the data as it's presented. They've been trained to digest only a particular format.

4 sales, 1 pending, all nearby, all within minimal adjustments and minimal marketing times. Tight range of unadjusted and adjusted sales prices, 9 active, 17 closed which would be considered comparable. Similar visual appeal (I think one was even a model match)......my point was, shouldn't it be fairly obvious there is marketability?

Not only are we being required to restate the obvious, but the myth continues that this 'predominant value' issue is of high importance. I appraise in mixed markets, minimal data markets and some darn near perfect markets. I simply do not see circumstances where I can relate to and understand what this client may be concerned with, other than a lack of understanding the data and report in front of them.

If being on the upper or lower range of value is an issue with marketability, in any case I've seen, you will have quite few a suggested guideline excesses you've had to discuss throughout the report. Time, distance, line adjustment, net/gross, etc. The greatest indicator to me that there could be a problem, is just simply few sales that are similar, and perhaps those that are somewhat similar having extending marketing times.

I'm here to discuss this issue with my peers in a 'is it just me, or do you see the redundancy and lack of understanding on the part of our clients?' I seek the information from some of my peers as well, as my market may not provide the circumstances that another's may. Perhaps there is some particular situation where all the planets line up, guidelines are met with ease, ample recent sales exist, minimal marketing times are noted, yet still, being 30% under or over the stated predominant range is an issue with marketability. If any of you have seen that exist, then please do share. Many of us may learn something new. :new_smile-l:

 

[Mr Rex]

Its a check box checker aka UW problem. No thinking outside the boxes for the check box checker/UW.

 

[Mike Boyd]

[QUOTE If any of you have seen that exist, then please do share. Many of us may learn something new. :new_smile-l:[/QUOTE]

I don't see it as an issue because, if it falls outside the predominant range, I add that one single statement.........."marketability is not affected." The client does not seem to mind the absence of a 9 page addedum that essentially repeats what is already in the report.

An underwriter looks for key phases such as what I have indicated. If they are in the report, they can go on to bigger and better things like......."4 more comps, please......"
if you have not also provided the key phrase........."comps used are the best available for this specific market area." They might ask........."why have comps been selected that are more than 1 mile away. Key phrase.............." there are no sales that were relevant found closer to the subject than those used."

Summary report. Summary report. Summary report.

 

[Eli Weiss]

PE, I need a good response on this request I got back today....

No view photos provided, so appraiser is asked to explain why there should be such a large adjustments for the subject's terrace when it is on the 2nd floor and subject to traffic noise and pollution."

This most be from some Redneck underwriter, my subject is condominium located in the prestigious Upper East Side section of New York City, where people just love listening to the traffic noise and inhaling the pollution, now I gotta start from A to explain all about NYC, the Upper East Side, and why a bit of outdoor space is so valuable, was she expecting some $5,000 adjustment for the outdoor space? Oh and BTW the subject is a rear unit and the front units with the traffic noise and pollution sell for even more, so where do I start? I feel like copying the following Wiki articles and send it back.....

http://en.wikipedia.org/wiki/Nyc
http://en.wikipedia.org/wiki/Redneck_(stereotype)

 

[laynelucia]

LoL, Beautifull!