Subject Property Actual Location

By Dave Towne

Excerpts: Appraisers, this article was prompted by my ‘coming in contact with several appraisal reports where different regional appraisers report the physical location of the subject property “in” a particular City associated with the postal ZIP Code for that City. Actually, the property was not “in” the City at all. It was in the County.

Don’t say that the subject property is ‘within’ a particular City or Town due to the postal ZIP Code that applies to the street address unless that is accurate. The actual location may be miles away from there.

Starting with the ZIP Code: those are merely lines on a map the US Post Office established, used to plan mail routes, and distribute mail more efficiently. ZIP Code boundaries do not always follow City Limit or County (Parish) boundaries, and in some cases, the boundaries are a long way from the City name associated with the ZIP Code. See Map 1. This shows 5 ZIP Codes in a region. The ‘City’ for 98273 and 98274 has two ZIP Codes associated. Note how wide the area coverage boundaries are for those two ZIP Codes. It’s not shown here, but 98284 extends north into the adjoining County!

To read more, click here

My comments: I have seen this locally. For example, the two cities were very different. Having an address in one city was more valuable than in the other city. The cities shared a few zip codes. When using GPS internet searches such as Google maps, the city boundaries don’t show up or are not reliable. I keep printed maps in my car that include city and county boundaries.

Appraisal Business Tips 

Humor for Appraisers

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To read more of this long blog post with many topics, click Read More Below!!

NOTE: Please scroll down to read the other topics in this long blog post on real estate market decline in listing prices, land issues, unusual homes, mortgage origination stats, etc.



Ohio House With Jail Cells $275,000

Excerpts: Built in 1972, the prime party house is now on the market for $275,000—and the listing photos have been shared all over the internet.

The home 6467 sq. ft., 4 bedroom and 4 bath home features jail cells just off the kitchen and main living space, and these repurposed cages come with a backstory.

“As legend has it, there was a local bank robber back in the early 1900s by the name of John Dillinger. He had broken out of jail and was robbing banks. It’s believed that these are the actual jail cells that John Dillinger was being held in. The [guy who built the home] got them from the jailhouse and put them into this property,” Stackhouse (the owner) says.

To see many photos click here

Scroll down the page.

My comments: Of course, the price seems very low. to me. I’m used to my local median prices at over $1,000,000! At the bottom of the web page are links to more homes with jails.


Why Appraisers Don’t Depreciate Land

By Jamie Owen

Excerpt: What’s the difference between a newly constructed home and a hundred-year-old home? Depreciation! When developing an opinion of the market value of a property, what appraisers are really measuring is how much depreciation a property has suffered from, and more specifically how much depreciation the improvements on the land have depreciated.

When measuring depreciation using the age-life method, which residential appraisers often use, the first step is to develop an opinion of the value of the land. Why? Because we measure the depreciation of the improvements that exist upon the land. Not the land itself. Why?

While it’s true that land values change over time, the land is a finite thing. As Mark Twain once said, “Buy land; they’re not making it anymore.”

To read more, click here

My comments: Jamie, as usual, has a different way of explaining appraisal topics! In my area, land sometimes moves or disappears: landslides, groups of homes slipping down steep hillsides where the land is moving, hillside land erosion from ocean waves, etc. You may have other factors in your area. The land is gone or moving, but not depreciating, I guess. Just losing or moving land.>


New in the July 2022 Issue of Appraisal Today

(Annual E&O/Liability issue)

  • E&O Insurance Update 2022 – Claims, State Boards, Discrimination, etc. By Claudia Gagline, Esq. and Magda Pretorius. Includes important disclaimers for your reports.
  • First Notice of Claim: Some Do’s and Dont’s, by Claudia Gaglione, Esq. Borrower complaints, real estate agents, attorneys, etc.
  • 2022 E&O Insurance – Where to Get Insurance, What to look for in a policy, etc.
  • 2022 E&O Insurance Brokers
  • Risk Management for Real Estate Appraisers and Appraisal Firms, written by Peter Christensen, Esq. – Book Review

To read more about this topic, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.

If this article helped you understand these topics and avoid liability, it is worth the subscription price!


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Very Big Log Cabin in the Catskills $2,499,000

Excerpts: Built in 2009, the home is has 8 bedrooms, 6.5 baths, 7,100 sqft, and an 8.87 acre lot.

“Twin Creeks” was built is nestled beyond the stone pillars and arched stone bridge between the two untouched mountainside streams of Cornell and Wittenberg mountains. Many thousands of acres of the NY State forestland surround the home. Two hours from NY City.

To read more and see many photos click here

My comments: Check out the photos. Wow!!


Ten things to know about price reductions in today’s market

June 28, 2022

By Ryan Lundquist


1) Nearly 40% of active listings have had a price drop

2) Many sellers are distracted by hot headlines from the past

4) No price range is immune from the slower trend

8) How much of a percentage price drop is happening though?

9) Poised to see more price reductions

10) Buyers have more opportunities

To read more and see more graphs, click here

My comments: This post shows how Ryan explains listing price reductions with text, tables, and graphs. Are they going down in your area? Use some of Ryan’s methods in your market.

Does this mean really big declines in sales prices? No one really knows. Percent declines may depend on factors such as the starter home market vs the higher priced market. In my area, over the past 45 years, I have seen price declines vary from 15% to 80% in nearby cities, with the greatest decline in lower priced homes.


More Than 40% of Home Sellers Are Dropping Their Prices in Salt Lake City, Boise, Sacramento and Other Pandemic Hot Spots

June 21, 2022

Excerpt: Nearly half (47.8%) of homes for sale in Provo, UT — located about 45 miles away from Salt Lake City—had a price drop in May, the highest share of the 108 metropolitan divisions in this analysis. Tacoma, WA, had about the same share of price cuts, at 47.7%. Next come Denver (46.9%), Salt Lake City (45.8%) and Sacramento (44.3%). Boise, ID (44.2%), Ogden, UT (42.6%), Portland, OR (42%), Indianapolis, IN (41.9%) and Philadelphia (41.2%) round out the top 10.

Provo, Boise, Salt Lake City, Sacramento and Ogden were also the top five metros with the biggest increase in the share of listings with price drops from a year earlier. Roughly 12% of listings in Provo and Boise had a price drop in May 2021, and it was around 20% in Salt Lake City, Sacramento and Ogden.

All in all, about half of the metros in this analysis saw more than 25% of home sellers drop their asking price in May. More than 10% of home sellers dropped their price in all 108 metros, driving the national share of price drops to a record high.

To read more, click here

My comments: See how your market is doing. The table at the bottom of the web page compares the number of price drops in May 2021 and 2022 in different areas. Also included is the median sales price in May 2022 and the percent drop from 2020 to 2022. Sort by location (on the left) to find if your market is listed.


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

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 or send an email to . Or call 800-839-0227, MTW 7AM to noon, Pacific time.

My comments: Rates are going up. Some appraisers are very busy and others have little work. Varies widely around the country.


The graph below is from the July 2022 issue of Appraisal Today.

This graph has been in every issue since the mid-1990s. 

What was your business like in 2018?

Mortgage applications increased 0.7 percent from one week earlier

Mortgage applications increased 0.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 24, 2022. This week’s results include an adjustment for the observance of the Juneteenth holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 0.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 20 percent compared with the previous week. The Refinance Index increased 2 percent from the previous week and was 80 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 0.1 percent from one week earlier. The unadjusted Purchase Index decreased 21 percent compared with the previous week and was 24 percent lower than the same week one year ago.

“Mortgage rates continue to experience large swings. After increasing 65 basis points during the past three weeks, the 30-year fixed rate declined 14 basis points last week to 5.84 percent. Rates are still significantly higher than they were a year ago, when the 30-year fixed rate was at 3.2 percent,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The decline in mortgage rates led to a slight increase in refinancing, driven by an uptick in conventional loans. However, refinances are still 80 percent lower than a year ago and over 60 percent below the historical average.”

Added Kan, “Overall purchase activity has weakened in recent months due to the quick jump in mortgage rates, high home prices, and growing economic uncertainty. Purchase applications were essentially flat last week but were supported by a 6 percent increase in government loan applications. The average purchase loan amount declined to $413,500, which highlights an ongoing downward trend seen since it hit a record $460,000 in March 2022.”

The refinance share of mortgage activity increased to 30.3 percent of total applications from 29.7 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 10.1 percent of total applications.

The FHA share of total applications remained unchanged at 12.0 percent from the week prior. The VA share of total applications increased to 11.2 percent from 10.7 percent the week prior. The USDA share of total applications increased to 0.6 percent from 0.5 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased to 5.84 percent from 5.98 percent, with points decreasing to 0.64 from 0.77 (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 $647,200) decreased to 5.42 percent from 5.49 percent, with points decreasing to 0.28 from 0.45 (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 remained at 5.62 percent, with points decreasing to 1.15 from 1.18 (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 increased to 5.06 percent from 5.05 percent, with points decreasing to 0.72 from 0.86 (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 decreased to 4.64 percent from 4.78 percent, with points decreasing to 0.72 from 0.84 (including the origination fee) for 80 percent LTV loans. The effective rate decreased 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
1826 Clement Ave. Suite 203 Alameda, CA 94501
Phone 510-865-8041

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