Unit of Comparison Calculation

[Pittsburgh Pete]

Here is what I will give you. It is more accurate. However, it is slower and would seldom yield different results from the spread.

You could do dozens waiting for your return calls!

Happy New Year to ya!

 

[Stephen J. Vertin MAI]

I already have

 

[Vernon Martin]

Use the coefficient of variation to select the best unit of comparison

I'm voting with Pete on this. The calculations shouldn't take more than one minute per comp.

Several months ago I got into a debate with a mortgage broker about the proper unit of comparison for valuing beach land. His client had an L-shaped parcel in which most of the lots were more than 1 km from the ocean. He insisted that I use price per hectare, but the subject parcel had very little beach frontage relative to the parcel's depth. I showed him that the coefficient of variation for price per hectare was 1.68, whereas the CofV for price per lineal meter of beach was just .48.

You would think that something like that would shut him up, but no. He claimed that my use of CofV was unprecedented and outside established appraisal practices. I'm glad to hear that the AI is teaching it and some of you are using it, too.