Weighted sales reconciliation methods

[J Grant]

TMD, agree, some adjustments are more important, and some houses are just "better", no matter how many upward adjustments one gives to an inferior house, the house itself was still inferior. We can't adjust for every line item feature or nuance of location and appeal. Plus, for Win total's suggested value to be accurate, the adjustments need to be good, and if they are a bit "off", then the value was 100% on adjustments (math). An AVM does math and so does Zillow and sometimes they are spot on and other times way off, or enough off to matter. An appraiser uses math as a tool but then applied judgement and experience, and other factors into opining the value...beyond the adjustments, where is the market going ? declining, stable, or rising? It makes sense to opine on the lower side in a declining market, and to the higher side of value range in a rising market, for example.

The win total suggested value is a handly little reference tool but just plopping it in, unless that is the exact value you would have opinined, is not good practice imo. I would look at it after you opine your own value.

 

[Mile High Trout]

Yes, the auto weighting happens when you exceed the variance threshold. That's what the eo reviewer will tell you through the warnings category as well.

Warning: You're software is adjusting your weight. Go manual instead.

Sometimes you clip on a spark plug and let it slide down the line over your bait, to trick the hooked fish into swimming towards you. While they are swimming towards you, the spark plug on their heads tricks them into thinking they are fighting current and have their head against a rock. That's how you reel in the very big ones on a light line.

 

[mark hurlock]

Okay, so you found Total's formula of how they make the calculation, which is a simple, straight forward formula:

The property weighting formula is used to calculate the weight given to each comparable listed in the Comps PowerView. In the formula, "Y" is used to indicate a comparable number (i.e. CompY could mean Comp1, or Comp 2, or Comp 3, etc.). Here is the formula:
A = 100 x [(CompY Gross Adjustment %) / (Total Gross Adjustment %)]
B = 100 - A
C = (Total number of comps) - 1
Weight of CompY = B / C

I suppose that this formula makes some sense if the comps are very similar to each other in that all of the adjustments given to the comps are for the same items (just the amount of the adjustments differ). Otherwise it is of very little use as it is too simplistic because it does not account for the relative importance of of different property attributes (IMHO, some adjustments are simply more important than others).

I wish I could pick winning numbers with as much ease as predicting your continued argument over the appropriateness of the weighting calculation.

Sorry you can't grasp the concept.

 

[mark hurlock]

some adjustments are simply more important than others).

So please explain how you quantify “more” importance.

Please be specific. What reasoning do you use to determine your final value if you are not weighting the adjusted values?

 

[residentialguy]

So please explain how you quantify “more” importance.

Please be specific. What reasoning do you use to determine your final value if you are not weighting the adjusted values?

Begging the question. You falsely assume that all things are quantified or need to be.

How much more do you love your wife than your cousins? Please be specific. What reasoning do you use to determine your answer if you are not weighting the adjusted values?


(I know that'll bring out the perves)

 

[timd354]

I wish I could pick winning numbers with as much ease as predicting your continued argument over the appropriateness of the weighting calculation.

Sorry you can't grasp the concept.

I fully well grasp the concept, however I reject your point of view regarding the approrpriateness of using the weighting calculation in all but the extremely limited circumstance I described in one of my prior posts. You obviously don't agree with my opinion...so be it.

 

[AnonApprsr]

That is not the definition of “reconciliation of value” – just a blind opinion with no essential supporting documentation

Non sequitur to this discussion. No one is saying such a thing. And $2,000 variance from 155,000 being less valid?....again, a joke. The day that an appraiser says he's within 1% of market value is the day he'll be proved wrong on every adjustment he makes or didn't make. No one goes to court and says "it's just a feeling I have" for support....well, besides Anon.

I'm the expert. It's my expert opinion based on my expertise which I've expertly exerted and asserted for 10 years now. There's 4 freaking sales in the report, the value usually falls within those 4 adjusted values and 4 sale prices. The report even has percentages of net and gross adjustments. The report even says which properties are located where, and when they sold! I put the most weight on the two sales that sold the most recently, with the least adjustments, on the Subject street. Yeah, it's just a feeling. Read the freaking report and feel that, your honor.

 

[mark hurlock]

I fully well grasp the concept, however I reject your point of view regarding the approrpriateness of using the weighting calculation in all but the extremely limited circumstance I described in one of my prior posts. You obviously don't agree with my opinion...so be it.

If you are going to make accusations, you shouldn't do it a board where everything I have posted is evidenced.


Now, please document where I said anything about “extremely limited circumstances”

 

[mark hurlock]

You obviously don't agree with my opinion...so be it.

And I am still waiting for you to quantify your final value opinion.

Looks like I will be waiting a long time.

 

[Wayne Henry]

Appraiser versus Reviewer round a lot

QC reviewer is a dope...a seriously stupid dope. Just tell them that it was not meant to be a mechanical formula, rather it was shown to indicate which sale was given greater emphasis.

Always ALWAYS leave yourself wiggle room. I rarely even use the word "weight" in reconcialition...now you know why. Weight can be measured, therefore it's a precarious word to use, imo. I would state that sales 1 & 2 were given emphasis because they required less adjustment. Comp 1 is located closer to the subject, etc.

I used emphasis and consideration and this is what I got from the reviewer today:
***In the reconciliation of final market value, please comment on how the comps were weighted.***

This is nuts! So I wrote back :

Please be advised that the exact word "weight" was not required on the order form. I used the words emphasis and consideration because after much debate with my peers it is the best words for the reconciliation process. If weight and percentages are used it draws the reader to determine that a mathematical calculation was used to reconcile the ending value which is not proper appraisal practice. Since this is the only issue please re review and send to client.