Appraisal News and Business Tips

4-18-19 Newz: Strange Bathrooms; Secret Suburbs; Accurate MLS Data?

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The Importance Of Accurate MLS Information

Accurate MLS Information Is Necessary For Reliable Appraisals

By Tom Horn

Excerpt: Topics include
– Accurate MLS Information Helps With Adjustments
– Square Footage Should Be Accurate
– You Can’t Measure It If It’s Not Described
Read the full article plus the comments.

My comment: Written for real estate agents. Maybe you can use some of it in your appraisal blog focusing on real estate agents. Of course, with Big Data, MLS inaccuracies are propagated and used for AVMs, including CU’s AVM.
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My Complaint with Complaints

By Steve Kahane

Excerpt: I recently helped a friend respond to a state board complaint. I was both aggravated and bewildered by the process. It bothered me that a good, honest appraiser who had produced a good, credible appraisal had to take time, effort and money to defend himself against a complaint because an agent was angry about the value. When all was said and done, it made me wonder whether the complaint process is an effective way to maintain appraisal standards or simply a means for disgruntled unintended users to get revenge.

The complaint system against appraisers has serious flaws that hurt good, honest appraisers. Conversely, it tends to ignore the deficient appraisers for whom it was intended. While the administrative disciplinary process is similar to the U.S. Justice System, it is separate and distinct, in ways that hurt appraisers. Worst of all, there is no evidence it serves the intended goal of USPAP-to promote and maintain the public trust.

http://www.workingre.com/my-complaint-with-complaints

My comment: Complaint systems vary widely among state regulators.

Lots has been written about it. Google state appraisal board complaints.

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The Appraisal Report – A Discussion with John Brenan of The Appraisal Foundation

Scheduled for April 25 at 10AM CST
Excerpt: How often do you have the opportunity to speak with representative from The Appraisal Foundation? Now is your chance!

Join us this April as Bryan Reynolds sits down with John Brenan, Vice President of Appraisal Issues at The Appraisal Foundation, to discuss a variety of issues, including:

– Questions pertaining to USPAP
– ASB’s recently adopted 2020-21 changes to USPAP
– AQB’s changes to appraiser qualification criteria
– PAREA: what is it and what does it mean to you?

Click here to watch video

My comment: Lots easier than attending a conference!!
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50 Cent’s Mansion Finally Sold at a 84% Discount

Excerpt: After 12 years and a more than $15 million price cut, the Farmington, CT, megamansion of rapper and entrepreneur 50 Cent has finally sold.

The 51,657-square-foot residence is under contract for $2.9 million, according to the Wall Street Journal. That’s an 84% discount from its original list price of $18.5 when it hit the market in 2007. It had languished there, undergoing price cut after price cut.

My comment: Good that I was not asked to do an appraisal on appraisal. Don’t even want to think about market conditions adjustment. My response “booked up for the next 2 years” ;>
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In the Paid Appraisal Today

Recent Appraisal Marketing Articles

  • Communicating with Non-Lender Clients – very different than lenders!!
  • Bail Bond Appraisals – all cash, very high fees, very little competition. Coming next month
  • Assessment appeals – Post card marketing, Types of reports, Re-assessment opportunities. Coming next month
  • How to get referrals from real estate agents
  • Expert witness for residential appraisers – Yes, No or Maybe
  • Overview. Non-lender appraisals are an excellent option! Full Fees, No AMCs, No CU, No UAD. Lots of marketing tips.
  • Home Measurement Services – a great way to make money using your appraisal measuring expertise!
  • Quick Start – how to get non-lender work ASAP. Lots of practical tips.
  • Estate and trust- the most popular non-lender appraisals. No court testimony, No AMCs, reviewers, etc. etc.
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Strange bathrooms

Excerpt: One of the weirdest bathroom encounters Lauren Cangiano, a licensed associate broker for Halstead Manhattan in New York, ever had was with a trendy, high-end Toto programmable toilet.

“Every time we walked past the bathroom during a showing, the toilet came to life and scared the daylights out of us,” Cangiano says. “The lid would open and close, and lights started flashing. I’m guessing it was set in such a way that someone could find the toilet in the dark. The zinger was when my client dropped something in the bathroom and water started squirting up out of the toilet. I think she activated the bidet setting!”https://www.realtor.com/advice/sell/bathoom-freaking-out-buyers

My comments: check out the links to strange kitchens, etc. in the middle of the article. We have all seen things a lot weirder, especially if it is a refi!!
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The Secret History of the Suburbs

Excerpt: The American suburb dates back much further than European colonization. Near St. Louis, archaeologists recently found the remains of a 900-year-old suburb of Cahokia, once the largest Native American city north of Mexico. (The site of the ancient suburb is in the modern town of East St. Louis, Illinois, “halfway between a crumbling meat packing plant and a now-closed strip club,” as NPR reported.)

Boston, New York, and Philadelphia all had suburbs before the Revolutionary War. As was (and still is) the case in Europe, they were mostly for lower socioeconomic groups. The elite stuck to the city center. But the mid-19th century saw the founding of the first suburbs we would easily recognize as such-pastoral upper- and middle-class enclaves including Frederick Law Olmsted’s Riverside, Illinois, and Llewellyn Park in New Jersey…

My comment: Fascinating!! Ok to scroll through intro about recent suburbs in the U.S.
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Republican tax bill likely curtailed 2018 home sales, Fed economists say

Housing market should have been able to “shrug off” last year’s rate gains

Excerpt: Republican tax reform that capped mortgage and property deductions has curtailed the housing market, according to a report from economists at the Federal Reserve Bank of New York.

While a 7.6% decline in the sales of new single-family homes from 2017’s fourth quarter through the end of 2018’s third quarter could be attributed to a 70 basis point rise in mortgage rates, the drop was larger than periods of similar rate gains in 2013 and 2016, according to Richard Peach and Casey McQuillan, co-authors of the report posted on the New York Fed’s Liberty Street Economics blog. That suggests additional forces are at work, they said.

My comment: Fewer purchase appraisals. Effect varies widely, depending on sales prices and local tax rates.
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NAR’s Yun says rates will “bifurcate” spring housing market

Cheap rates will drive the low end, while luxury segment “softens”

Excerpt: Sellers of houses near or below the U.S. median price of about $250,000 are going to see strong demand in the so-called spring selling season, said Lawrence Yun, chief economist for the National Association of Realtors.

The high end of the market – homes priced above $750,000 – will have a tougher time, he said. The spring market is the March through June period when more than half of U.S. home sales take place.

“For anything below the median home price there will be strong demand because of the good jobs market and the low mortgage rates,” Yun said in an interview. “On the upper end things will be softer, so it will be a bifurcated housing market in 2019 and probably into 2020.”

My comment: I guess appraisers are not the only ones using “bifurcate”…
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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 7AM to noon, Pacific time.
 

Mortgage applications decreased 3.5 percent from one week earlier

WASHINGTON, D.C. (April 17, 2019) – Mortgage applications decreased 3.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 12, 2019.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3 percent compared with the previous week. The Refinance Index decreased 8 percent from the previous week. The seasonally adjusted Purchase Index increased 1 percent from one week earlier. The unadjusted Purchase Index increased 2 percent compared with the previous week and was 7 percent higher than the same week one year ago.

“Mortgage applications decreased over the week, driven by a decline in refinances. With mortgage rates up for the second week in a row, it’s no surprise that refinancings slid 8 percent and average loan sizes dropped back closer to normal levels,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Purchase activity remained strong and increased slightly, reaching its highest level since April 2010. The spring buying season continues to be robust, with activity more than 7 percent higher than a year ago and up year-over-year for the ninth straight week.”

The refinance share of mortgage activity decreased to 41.5 percent of total applications from 44.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.6 percent of total applications.

The FHA share of total applications decreased to 9.4 percent from 9.6 percent the week prior. The VA share of total applications increased to 11.6 percent from 11.1 percent the week prior. The USDA share of total applications remained unchanged from 0.6 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased to 4.44 percent from 4.40 percent, with points decreasing to 0.42 from 0.47 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) increased to 4.33 percent from 4.28 percent, with points decreasing to 0.23 from 0.28 (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 increased to 4.43 percent from 4.42 percent, with points increasing to 0.56 from 0.48 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.84 percent from 3.83 percent, with points increasing to 0.45 from 0.42 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs increased to 3.88 percent from 3.78 percent, with points decreasing to 0.19 from 0.26 (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.

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   ann@appraisaltoday.com

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