Appraisal News and Business Tips

9-14-17 Newz:// No Appraisal Waivers, How Many Comps Are Enough?, Ugliest House

Google Street Views – First Big Update with Lots More Big Data!!

Excerpt: The car-top rig includes two cameras that capture still HD images looking out to either side of the vehicle. They’re there to feed clearer, closer shots of buildings and street signs into Google’s image recognition algorithms.
Those algorithms can pore over millions of signs and storefronts without getting tired. By hoovering up vast amounts of information visible on the world’s streets-signs, business names, perhaps even opening hours posted in the window of your corner deli-Google hopes to improve its already formidable digital mapping database
My comment: Fascinating article. Check it out. I use Street Views a lot, but sometimes the images are fuzzy and are hard to figure out. Looking forward to improvements, but on the minus side, more data available that field appraisers provides now.

36 Appraisal Organizations Send Letter to Party Leaders of House Committee on Financial Services and Senate Committee on Banking, Housing and Urban Affairs on “No Appraisal” Waivers

Excerpt: 36 industry groups are attempting to prevent the Fannie Mae and Freddie Mac (GSE’s) from issuing appraisal waivers by sending a letter to the chairs and ranking members of the Senate Banking, Housing and Urban Affairs Committee, and the House Financial Services Committee addressing its concerns. AI recommends the halt of the waivers until the GSEs can demonstrate that the proposed program does not harm the consumer, is properly monitored, and integrates proper safeguards to prevent fraud.
We are writing this letter to raise concern over the new appraisal waiver programs recently implemented by Freddie Mac and Fannie Mae (the ” Government Sponsored Enterprises.”)  We believe these programs will create unnecessary and unacceptable risks for taxpayers and homeowners, and they come at a time when markets are at all-time highs – when risk mitigation should be tantamount. We ask you to call on the Federal Housing Finance Agency (FHFA) to prevent the Enterprises from implementing the appraisal waiver programs until they can demonstrate the appraisal waiver program:

My comment: Worth reading. Read the names of all the organizations that sent the letter. I can’t remember when so many appraisal organizations agreed on anything!!

9 Unintended consequences from no appraisal mortgages

By Tom Horn
Excerpt:
Here are a few:
– Independence is lost
– Inaccuracies in the size of the house will grow
– Checks and balances for AVM’s will be lost
My comment: Worth reading. Good analysis of the issues I have seen. Plus lots of comments.

http://birminghamappraisalblog.com/in-the-news/unintended-consequences-from-no-appraisal-mortgages/

How a pimp built the ugliest house in America

Just For Fun!!
Excerpt: The home, whose recent listing was first spotted by Curbed, is the bizarre brainchild of “almost-famous pimp-turned-construction mini-magnate” Jerry A. Hostetler, who died in 2006 at age 66. Police dubbed him the area’s “Mr. Big” after he pleaded guilty to pandering and running prostitutes. (The nickname worked on a few levels: He was 6-foot-2 and weighed as much as 500 pounds.)
Mr. Big started amassing his fittingly giant fiefdom in the 1960s, starting with a three-bedroom ranch and then buying up neighbors’ houses.
See the photos and read the very interesting commentary.
My comment: The most popular marketing topics are increasing income, fear of no income, and sex ;> I finally got to write something about sex!!
 

Beware of an Appraiser IRS Audit! 

My True Story…

In the next issue of the paid Appraisal Today

 
Last month I had an IRS random audit, where they looked at everything in my income tax return for 2015. It was very, very stressful. I spent a lot of time getting ready for it.
Here are some of the issues:
– Home office, separate from my regular business office.
– Mileage log.
– Receipts for all expenses, particularly credit card purchases.
– Don’t represent yourself. Use a CPA or enrolled agent to do your tax return and meet with the IRS.
and lots more…
Now I know what I should have done, how I should change my bookkeeping methods, etc.
The greatest risk is for appraisal companies with employees or independent contractors. Most of the appraisers I know were audited because of this. I write about this big risk.
To read the article, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
 
If this article saved you from IRS problems 
(or worrying about them), 
it is worth the subscription price!! 

$8.25 per month, $24.75 per quarter, $89 per year (Best Buy)  
or $99 per year or $169 for two years 
Subscribers get, FREE: past 18+ months of past newsletters
To purchase the paid Appraisal Today newsletter go to
www.appraisaltoday.com/products   or call 800-839-0227.
——————————————————
If you are a paid subscriber and did not get the September 2017 issue, emailed September 1, 2017, please send an email to info@appraisaltoday.com  and we will send it to you!! Or, hit the reply button. Be sure to put in a comment requesting it.

How Many Comps Are Enough?

Quiz: How many comps are “just right?”

Excerpt: So: How many comparable-competitive-similar-comparables are best? Is it three because that fits on a standard sheet of paper? Should it be six, because that fits well sideways on a spreadsheet? Or should it be the whole city or neighborhood?

More questions: Are two comps better than one?  Are four comps better than two?  What about 8 instead of 4, or 32 or 63?  How about 12,448 comps? Is there an optimum amount of data?

My comment: I love George Dell’s great headlines. Very creative. Plus, interesting blog postings on Hot Topics. George wrote an article for the September paid Appraisal Today article: “Is the Traditional Appraisal Process Becoming Obsolete?”

How much home can you buy in each state for $200,000, Zillow’s median price home?

 Excerpt:
The results highlight the enormous differences between housing values in the U.S. It is all about location, location, location. In the Hoosier State, your $200k mortgage can purchase 2,330-sq. ft., but in Washington D.C. only 497 sq. ft. That’s the difference between a large home and a cramped studio apartment.
Check out the very interesting table at:
My comment: Thanks to Jonathan Miller for including this in his current blog post: http://www.millersamuel.com/note/september-8-2017 
.
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 9.9 percent from one week earlier

WASHINGTON, D.C. (September 13, 2017) – WASHINGTON, D.C. (September 13, 2017) – Mortgage applications increased 9.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 8, 2017. This week’s results included an adjustment for the Labor Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 9.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 13 percent compared with the previous week. The Refinance Index increased 9 percent from the previous week. The seasonally adjusted Purchase Index increased 11 percent from one week earlier. The unadjusted Purchase Index decreased 13 percent compared with the previous week and was 7 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to 51.0 percent of total applications from 50.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.7 percent of total applications.

The FHA share of total applications increased to 9.9 percent from 9.6 percent the week prior. The VA share of total applications increased to 10.3 percent from 9.7 percent the week prior. The USDA share of total applications remained unchanged from the week prior at 0.7 percent.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to 4.03 percent from 4.06 percent, with points increasing to 0.40 from 0.38 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) increased to 4.00 percent from 3.96 percent, with points increasing to 0.24 from 0.20 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.94 percent from 3.98 percent, with points decreasing to 0.34 from 0.35 (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 3.30 percent from 3.34 percent, with points increasing to 0.39 from 0.38 (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 3.17 percent from 3.14 percent, with points increasing to 0.36 from 0.31 (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.

Leave a Reply