Appraisal Today
Newz .Data verification .AMCs-percent of work .Drones
- August 4, 2016
 
Q_A


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Collection and Verification of Residential Data in the Sales Comparison Approach
 
Appraisal Practices Board, Issued June 30, 2016, First Exposure Draft
 
Deadline for comments is August 12, 2016
 
The document includes examples for lender and non-lender work plus references to lender requirements. Extensive discussions on scope of work for different types of assignments, such as relocation, individuals, effect of zoning, estates, etc. as well as verification sources, etc. etc.  
 
Excerpt:
 
Example 2 - Client: Conventional Lender Effective Date: January 20, 2015
 
After the four siblings receive a market value range of $139,000 to $155,000 from the appraiser, they compare this range to a $140,000 cash offer they received from a buyer who was willing to close in one week. The siblings accepted the offer because they were motivated to sell. This new buyer purchases the residence on January 15, 2015, for $140,000 cash and then decides to finance the residence with a conventional loan. In this instance, the client is the lender.
 
For this assignment, the lender has specific requirements regarding what data points to verify and with whom the appraiser should verity those data points. The lender also has guidelines such as the minimal number of comparable sales the appraisal will report, and a time frame within which those comparables sold. The appraiser accepted the lender's specific requirements and produced credible assignment results within these parameters. The final opinion of market value was $150,000, with an estimated exposure time of six months.
 
Every client and assignment condition will have different requirements for how much sales data is collected and how that data is verified. This can include using different sources, using different levels of verification, and concentrating on the verification of different data points. The overall goal for verification is to verify data to a level that is necessary for credible assignment results, not to necessarily verify all data and certainly not to verify all data to the same level. Different levels of verification are acceptable based on assignment conditions, availability of data, and the relevance of each data point.
 
 
My comment: Finally the APB has something useful and practical for residential appraisers!! Be sure to read and comment on this 52-page draft. Worthwhile reading. Very comprehensive on this important topic. Discusses lender issues, including CU. I have not read the entire document but plan on reading it very soon.
 
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How Dirt Houses Became Beloved By The Tiny House Movement
Meet the wondrous cob.
 
Excerpts: It's likely that earthen homes were among the oldest structures ever built by humanity. There are a few different techniques and many names for a building made mostly of, well, dirt, but the one that's caught on in this recent revival of the material comes from England: Cob.
 
See the photo of: Ancient cob high-rise buildings in Shibam, Yemen.
 
Very interesting and detailed with photos:
 
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America's Most Expensive Homes For Sale Right Now
Just for Fun - take a break and check it out!!
 
Excerpt: Currently, 26 homes are on the market for $75 million or more... three of the properties will hit the two-year mark in the fall. Nine have been on the market for between one and two years, or will be by September. In contrast, the typical American home is currently selling in just 41 days, according to online brokerage Redfin.
 
Scroll through the 27 gallery photos and click on the links for more info.
 

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Will Collateral Underwriter destroy residential lender appraising?New in the August 2016 paid Appraisal Today newsletter

Excerpt: 
What percent of mortgage loans are sold to GSEs and done through FHA and VA?
   They dominate the conforming lending origination market at 67%. However, their share was much lower previous to 2008. 
   UAD - Fannie, Freddie and FHA accept UAD directly. VA uses UAD through LoanSafe by Corelogic.
   CU - developed by Fannie. Freddie is developing their own. VA and FHA are collecting UAD data and may be developing their own in the future.
   Loans not sold to Fannie will not use CU. Loans over the GSE ($417,000) and FHA/VA limits  are"unsecured first liens" at 30% of the market, I assume. They not use CU. Second liens are a relatively small part of the market at $ .06 trillion.

My article also discusses many other topics, such as AVM accuracy, data problems, Deminimus, options for appraisers, risk-based appraisal ordering, etc. 
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If you are a paid subscriber and did not get the August 2016 issue, emailed August 1, 2016, please send an email to [email protected]   requesting it and we will send it to you!! Or, hit the reply button. Be sure to put in a comment requesting it ;>
Drones - the Appraiser's Next Great Tool
 
Excerpt: It's been a long time since a new technology, other than software and gadgets that can measure and take notes in the field, has been available to us and I find it very exciting.
 
Our office has utilized aerial photographs in an appraisal on more than several occasions. Here are some examples: pictures of a new roof system installed on an older improvement; large acreage tracts that the client wanted in order to know more about forestation and topography; proximity to surrounding properties or features such as rivers, lakes, commercial buildings, and power lines - just to name a few. This bird's eye view can provide the client with a much better idea of the neighborhood surrounding a property and physical characteristics of the property itself. To coin a phrase, "a picture is worth a thousand words."
 
 
My comment: I want one!! For those homes on steep hillsides, a better aerial view, homes behind locked gates, holes in roof, finding escaped cats and dogs, etc., etc. Or, Just For Fun!! Google "appraisers and drones" and see other online writing and discussions, both positive and negative, of course ;> Add your comments to the story...
 
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Poll: What percentage of your work do you receive from AMCs?
www.appraisalport.com Take the current poll:
Overall, how would you rate your experience working with AMC's over the past year?
 

 
My comment: Looks like there are some appraisers who don't work for AMCs. I had expected higher percentages that worked mostly for AMCs. Now that business is strong, some appraisers don't work for AMCs, or take less work from them. When business is slow, they do more work for AMCs. 
 
WHAT DO YOU THINK? POST YOUR COMMENTS AT www.appraisaltodayblog.com and read the comments from other appraisers!!
 
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We have lost track of the purpose of the appraisal process
 
Excerpts: This is an open letter to anyone who may have an interest in the residential real estate market. This includes buyers & sellers, homeowners, mortgage companies & brokers, real estate brokers & agent, loan officers, FHA/HUD, Fannie, Freddie and others.
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The appraiser is required to provide an independent evaluation of the subject property without bias or influence from any outside entities including the intended mortgagee and all of the others cited above. It is a violation of both state & federal regulation for anyone to influence or attempt to influence the appraiser in the completion, development or conclusions of the appraisal report. You may disagree with the appraisers' conclusions and even the content of the appraisal report however it is the appraisers' opinion of the estimated value and no one can attempt to influence or change the conclusions in the report...
 
Read the full commentary and the comments (some are very interesting) at:

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HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to https://www.mba.org 
 
Note: I publish a graph of this data every month in my printed newsletter, Appraisal Today. For more information or get a FREE sample issue go to www.appraisaltoday.com/products   or send an email to [email protected] . Or call 800-839-0227, MTW 8AM to noon, Pacific time.

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Ann O'Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
2033 Clement Ave. Suite 105
Alameda, CA 94501 Phone 510-865-8041
Fax 510-523-1138
Email   [email protected]