Urban Appraisals

[Jeff Horton]

I live in a large county with three small towns and several really small communities. Sales within 5 miles and 12 months are the norm for us. Outside of town 10 miles i not uncommon and have had MH that comps were 20 miles away. Rarely do we have 6 months and within a mile!

I took an FHA job in the adjoining county in a much larger town. I don't go there often because of the drive time but I do a few there. Just got through with grid. First I have 3 sales very similar within .2 miles. All within 6 months.

I just entered them in the grid and plugged in my square footage adjustment. Then I looked and the only difference was age. It looked like...... no it was a perfect matched pair set. When I made the adjustments they all come out within a grand or each other.

I know this doesn't happen all the time but you guys have so much better data to work with it makes me envious! And it makes me wonder how number hitters get away with it Urban areas.

Get this one out and back to great comp hunt for the next one!

 

[larryhaskell]

You may be right about the data Jeff but when was the last time your had to slow down to a crawl waiting for the traffic on the freeway? By choice, I take assignments in the more rural counties just to get away from the city and actually go into a county office. The immediate Reno/Sparks area is about 350,000, what do the people do in the BIG cities? Thanks to the internet, we can actually access data in three additional counties located 25-50 miles away. I still like going into the county offices once in awhile anyway.

 

[Ghost Rider]

Review a couple reports from the area, and you'll see how it's done. Sometimes, working in rural/suburban areas can be easier IMHO, simply because of the limited sales data. In the urban area, the wealth of sales data can make things more difficult for an ethical appraiser, and a LOT easier for the number hitters. There is one of the EASIEST cities to do appraisals in about 20 minutes from my house. I used to do a TON Of work there when the market made sense, and when I refused to use the "flip" sales as comps for refi's and arms length transations when better sales data was available, the lona reps and realtors started to get upset, and the faucet got shut off. There is a section of the city where there are 750+ homes, all Raised Ranches, Ranches, and Split Levels......All built from 1968-1975 (with some new "in-fill" construction happening recently), the most cookie cutter area you could imagine, and turnover of homes happens constantly......EASIEST place I have ever worked, I would go there, do 3 inspections in a day, and be able to take pictures of my comps standing on the front stoop of my subject, heaven......

Until I started reviewing appraisals OTHER people were doing in the area - pulling comps a mile away, using the "in-fill" new sales to comps to the house built in 1972, going back 11 months to pull the highest sale in the area, I've seen DISASTERS........I do a lot of review work, and see some AMAZING reports, with made up comps, where the house doesn't even exist, the street doesn't even exist in town!!!!!

I should scan in my favorite one I ever saw. Simple appraisal of a raised ranch, the value used in the report was actually spot on, within $1,500 of what was my estimated value on the review. The problem was, 2 of the three comps were made up!!!! BUT, the funniest part, the made up comps exceeded all the Fannie Mae guidelines!!!!! One of them had a GLA that was 40% larger than the subject and "closed" 13 months from the effective date of the appraisal. The other was supposed to be 5 miles away, and had a 18% line item adjustment and the net adjustment was -24%. I still haven't figured out what the guy was thinking. If you're gonna make up the comps, at least make up good ones, right??

 

[Restrain]

I work the DFW area. Located in Denton, we're 30 miles north of both Dallas and FW. However, I go in to North Dallas and North Ft. Worth, but go out to the Oklahoma Border, including 6 counties. The reason is that I can get almost as much done going into the smaller cities as all have MLS and not deal with the freeways. Having worked a rural area (40000 total county population) bevore, I know what you are dealing with. We made the choice and while we still love the country, it's so much easier.

Roger

 

[Mike Simpson]

"I know this doesn't happen all the time but you guys have so much better data to work with it makes me envious! And it makes me wonder how number hitters get away with it Urban areas."

You'd be amazed @ the number hitters in metropolis! I had a report I completed recently in which I provided six comps (I know this business well enough to know the client was gonna complain). All comparables were within 3 blocks--2 were of the same exact model as the subject (one backed to the subject & the other was within a block).

I completed the assignment & the homeowner complained. They wanted their money back when another appraiser (a.k.a. numberhitter) was brought in to get the desired value. I was quite irreverent & recommended we call the state & let them sort it out--they jumped off my back & disappeared quickly!

Sweatshops are more common than not in these areas & turn out tomorrows number hitters in volumes similar to puppy mills--it's disgusting (the amount of damage they can do to the economy) & nearly impossible to compete with them (lenders call them "good appraisers"--"good" to a lender means an appraiser hits the number everytime & overlooks conditions)--be thankful for what you have!

-Mike

 

[Tim The Enchanter]

Rarely do we have 6 months and within a mile!

Rarely do I exceed those parameters, then usually in the "nonconforming / weird" areas.

you guys have so much better data to work with it makes me envious! And it makes me wonder how number hitters get away with it Urban areas.

I don't know how much better the data quality is. <_<
Quantity in most of my areas is not a problem these days.
Selecting the best comps is.

Sales can range over $100k diff for similar size homes in the more "affordable" average type areas, and up from there in the mid to high end areas. The main differences being condition effective age etc in the low end, and views quality upgrades etc in the higher $ stuff. Oh yeah Location.

Which sales do you think the hitters choose from "comps" to their average 50 YO house in the flats (no view)? :twisted:

BTW, working the "rural" areas within my range?
A real PITA. From finding the subject and comps, to gathering the info you need, to explaining all the nonconforming stuff. I'd rather not go there for an appraisal. :lol:

 

[Tim Hicks (Texas)]

I thought the AVM's were doing all the "cookie cutter" urban stuff now.

 

[Tim Hicks (Texas)]

I agree with Roger. I do quite a bit of rural appraisals and find them quite easy with a participating MLS. I know many appraisers that charge extra for homes on acreage and turn down work in the surrounding counties. I can do some rural work faster than driving to Dallas and back. Plus, if you build a niche in some areas, it seems you already have the comp pictures from previous appraisals. I smile when I hear appraiser buddies bragging about turning down work in certain counties or cities because they don''t realize they are just throwing easy money out the window.

Remember, a rolling stone gathers no moss. It is better to have work, even in out lying areas, than to have none and play computer solitaire.

 

[hal380]

Hi Jeff:

Your avatar says is all. If I showed up in my market with a kyack (sp?) people would wonder what it was.

There are +'s and -'s.

Regards


Hal