Appraisal News and Business Tips

6-15-17 Newz// Appraisers Replaced by Data Analysis, Very Unusual Hotels

8 of the Most Unusual Hotels in the Netherlands

Proof the Dutch can convert nearly anything into a place to stay the night.

Excerpt: n industrial crane or wooden wine barrel would be unremarkable objects anywhere else. But in Holland, these unexpected structures have been transformed into one-of a-kind hotels, made habitable and even luxurious with some loving restoration and redesign. Prefer to spend the night in a tilted cube house or the rumored birthplace of a secret shadow government? The Dutch have got you covered there, too. Here are eight hotels in the Netherlands that offer visitors a unique place to stay.

My comment: Very Interesting. Good for a quick break from writing up appraisals. I love appraising but hate writing up the those darn reports ;>
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The Highest Home Price Increases Around the World

Excerpt: When it comes to the world’s fastest-rising prices for luxury residential real estate, don’t look to the United States.

Instead, China dominates, leading with Guangzhou, the capital of the southern province of Guangdong. Luxury home prices in Guangzhou shot up 36.2% from March 2016 to March 2017, according to Knight Frank’s first-quarter Prime Global Cities Index. The single-digit price increases in the U.S. look modest by comparison, although frazzled American buyers might not see it that way.
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Find lot size – use www.findlotsize.com

From Dave Towne
It’s designed to allow a user to measure distances, and get a site area calculation of a property – as long as the perimeter boundaries are obvious.
I’ve been working on an assignment where the subject and comps have a waterfront dock. But two of the comps are in a county where the Assessor does not show the dock length on their web site.  The RE Agent mentioned the dock in the listing, but often their dimensions are not totally accurate or not shown.  I will be making a “dock length” adjustment in the report, because the dock is one of the key components of the subject property.  So the lengths are important.

Using the above web site, I was able to zero in on the aerial photo of each comp, and get a fairly precise measurement of the dock length. But to be safe, I show the length as ~40′ or ~30′.  The tilde is the symbol for ‘approximately.’

My comment: Thanks again Dave for this Most Excellent Link!!

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Will appraisers be replaced by Data Analysis (robots)?

Lots of speculation on how many jobs will be replaced by Robots (software, apps, etc.) Below are 3 articles related to the topic.

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Will robots (Data analysis) replace appraisers and other mortgage professionals?

Excerpt: … a future of efficiency and accuracy will only be aided by improving and increasing the power of our smartphones and other personal and professional devices.
But could all of this advancement come with a much darker side?
According to a website, called Will Robots Take My Job?, developed by Mubashar Iqbal and designed by Dimitar Raykov, robots will indeed take over. By some estimations, millions of jobs are at risk across the nation.
And this appears especially true for many mortgage and real estate jobs. But, not everyone is buying the results.
My comment: For appraisers, the big factor is use of data for analysis and valuation. See what George Dell says below. Add your comments at the end of this article and see others’ comments.
Read the comments and post your own.
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How Does Technology Change Change Your Future?

Is it just change, a little change or a big change? What is the likely answer?

By George Dell, Appraiser Stats Guru
Excerpt: There are two change possibilities:  1) You will be mostly replaced by a machine; 2) You will be running the machine in combination with your subject-matter knowledge.
As humans, and as appraisers, we still have some natural advantages.  But in order to run the “machine” we have to understand it.  The ‘machine’ has two parts:  the data, and the algorithms.  Let’s look at these two parts.
The first part is the immediate, complete, and improving data available.  Gone are the days when three or four “best” comps were about all that could be done.  Big data means most all the sales are available, right now.  When we discard information, we lose both accuracy and precision (“trueness” and “sureness”).   For us to compete, we need to start to use all available data – just like USPAP tells us.  We can get all the data as well as the machine.  So the data part of the future is not the big issue.  Is the problem in understanding a bunch of data?
The second part is computer power…
Link to this commentary, plus check out his other postings and sign up to get notices of new posts!!
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Bad real estate advice & blue bathrooms

Excerpt:
a)  False hope: Consumers hear they can increase their value by $5,400, so they think they can just buy a gallon of paint for $30 and make some huge profit. As Jonathan Miller said, “The consumer absorbs the results as gospel without challenge.”
b)   Location: Which market would this idea of blue paint apply? Is it true in Portland, Sacramento, Birmingham, and Baton Rouge? Is it equally true at $200,000 as well as $900,000? Was it true when the market was collapsing in 2007 or is it only true right now? How long will it continue to be true?
Interesting and worth reading, plus the comments, at
List of other colors plus value estimates

http://rismedia.com/2017/06/03/paint-colors-sell/

My comment: One of the many, many examples of data analysis and completely stupid results!!
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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 www.mbaa.org 
Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample issue go to https://www.appraisaltoday.com/products.htm or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.

Mortgage applications increased 2.8 percent from one week earlier

WASHINGTON, D.C. (January 30, 2015) – WASHINGTON, D.C. (June 14, 2017) – Mortgage applications increased 2.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 9, 2017. Last week’s results included an adjustment for the Memorial Day holiday.
The Market Composite Index, a measure of mortgage loan application volume, increased 2.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 27 percent compared with the previous week. The Refinance Index increased 9 percent from the previous week to the highest level since November 2016. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index increased 19 percent compared with the previous week and was 8 percent higher than the same week one year ago.
The refinance share of mortgage activity increased to 45.4 percent of total applications from 42.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 7.4 percent of total applications. The average loan size for refinance applications reached the highest level since September 2016 at $274,700.
The FHA share of total applications increased to 11.2 percent from 10.6 percent the week prior. The VA share of total applications remained unchanged at 11.1 percent from the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to 4.13 percent from 4.14 percent, with points increasing to 0.35 from 0.34 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) decreased to 4.06 percent from 4.08 percent, with points increasing to 0.24 from 0.21 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 4.00 percent from 4.01 percent, with points decreasing to 0.29 from 0.39 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.37 percent from 3.39 percent, with points decreasing to 0.34 from 0.43 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs increased to 3.26 percent from 3.19 percent, with points decreasing to 0.20 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.

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