What Do Appraisers Look For in a Sales Contract?

Why must an appraiser be given a copy of the sales contract? First and foremost, Standards Rule 1-5 in the Uniform Standards of Professional Appraisal Practice (USPAP) states that we are to: “analyze all agreements of sale.” That’s the real reason why—because USPAP says so.

Secondly, the appraiser is likely familiar with the local real estate contract forms, customary terms, and conditions of real estate transactions in the area, and might be able to identify irregularities and comment on them.

Thirdly, and more importantly, there may be provisions in the contract that identify concessions, non-real property items included in the sale, or other unusual conditions that would give the appraiser the opportunity to comment on or explain in the appraisal report as to why there is a difference between the indicated market value of the subject property and the contract price.

To read many practical tips, click here

My comments: Worth reading. Answers a lot of appraiser questions. Of course, I have always preferred not knowing the sales price as it seems like a conflict for an objective, unbiased appraisal.

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 Fannie Update: UAD and New “Forms”, concessions, non-lender appraisals,  unusual homes, mortgage origination stats, etc.


Fannie Update: Uniform Appraisal Dataset (UAD) and Forms Redesign

Excerpt from 3-29-23 email

The Uniform Appraisal Dataset (UAD) and Forms Redesign has taken a big step with the release of the implementation resources. Fannie Mae and Freddie Mac (the GSEs) have worked on the UAD redesign since 2018, leveraging extensive stakeholder input to update the appraisal dataset, align it with the current industry-standard MISMO® Reference Model, and replace the GSE appraisal forms with a single data-driven, flexible, and dynamic appraisal report for any residential property type.

The GSEs have posted the following industry resources to begin the multiyear rollout phase:

  •  Playbook – for all industry partners to begin planning for implementation.
  • Technical specifications – for all stakeholders, but especially for organizations that will develop the new appraisal report (e.g., appraisal software vendors), consume report data (e.g., appraisal management companies, lenders, loan origination systems), or use the new Uniform Residential Appraisal Report (URAR) (e.g., lenders and appraisers) to begin understanding the future state and start their development process.
  • URAR examples for various property types.

Playbook excerpts

This playbook is designed to help industry partners prepare for and adopt the multi-year, joint governmentsponsored enterprise (GSE) initiative to update the Uniform Appraisal Dataset (UAD) and retire the existing appraisal forms.

It provides information about how industry partners can benefit from this initiative, timelines and roadmaps to keep you on track for building to or implementing the new UAD and redesigned Uniform Residential Appraisal Report (URAR), and additional resources to learn more along the way.

As we get closer to the implementation date, we’ll provide links to training opportunities, so check back often to make sure you’re on track.



What this document is, is a programming blueprint showing all the report fields on what will become the new dynamic form.

This is the comment with the document: “The purpose of this document is to show all possible Report Labels that may display on the URAR, regardless of conditionality. This is not intended to represent a realistic report as an appraisal will never contain all of the available fields in one report. The red superimposed number is the Report Field ID.” The future form will be ‘dynamic’ in its implementation. The fields that will appear on the ‘form’ will be dependent on the TYPE of property being appraised…..that’s what is meant by their term “conditionality.”

To read the document (Partner Playbook), plus links to more extensive information, click here.

To download Uniform Residential Appraisal Report Sample (PDF) click here

My comments: Finally Fannie sends us sample reports! Timeline 2023-2024. Most of the document is technical as it covers information for all stakeholders. Look for appraiser and forms software vendor sections.

There are pluses and minuses of the new format. I will send some of them in next Friday’s newsletter as more of us have time to review the document. for example, the certification adds more language certifying that the appraisal does not discriminate and is completed consistent with fair housing laws. It is also explicit in pointing out that while borrowers may rely on the report for their mortgage finance purposes, they are not intended users.


How 19th-Century German Farmers Turned Caves Into Homes

Excerpts: Helmut Scholle pushes open the narrow wooden door flanked by small windows and ducks his head as he steps into the cave. Behind the simple rocky exterior is a home, complete with distinct rooms, a chimney, and cozy furniture. Two things become obvious.

Despite the frigid winter air, it’s relatively pleasant inside. And the marks on the rugged walls—signs of repeated chipping and chiseling—indicate that this home required a monumental human effort to make. The cave, Scholle reveals, was carved into the rock by migrant farmworkers in desperate need of housing.

To read more click here 

My comments: Don’t miss the interior photos. I have seen articles from all over the world about groups living in caves in the distant past. Sometimes I see articles about recently built cave homes for individual owners or part of a home in a cave. Long ago many humans lived in caves. They were safe and somewhat climate controlled.


Goofy Buildings: Revisiting the Heyday of California’s ‘Crazy’ Novelty Architecture – Giant hats, portly pigs, and drive-thru donuts.

Just For Fun!!

Photo above: No word on whether frogs’ legs were on the menu

Excerpts: In the 1930s, a British traveler in Southern California wondered if the local architects had gone a little nuts. It was either that or he had stumbled into a fantasy universe. There was something trippy about the roadside shops he saw along the way…

The unusual businesses he saw weren’t on some Hollywood backlot, but were California’s classic coterie of mimetic architecture-that is, buildings shaped like, well, anything but buildings. According to Cristina Carbone, a professor of art and architectural history at Bellarmine University in Louisville, Kentucky, the practice dates back to at least the Renaissance.

Fascinating!! To see lots of photos and interesting comments Click here


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I have been doing many types of them since 1986 and can speak from experience. included are many practical marketing tips, how they differ from lender appraisals, what types are best for you and more.


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5 Weird Rules Homeowners Associations Can Actually Enforce

Homeowners typically have a love-hate relationship with their homeowners association. They love the HOA for keeping the neighborhood, pools, and parks looking impeccable, but don’t always like how it goes about enforcing the rules. That means homeowners sometimes deal with tough guidelines or face stiff fees for infractions.

“Some HOA rules can seem overbearing, but are required by state law—such as no glass or pets in the pool area,” says Kelly G. Richardson, a real estate agent, attorney, and co-founder of Richardson, Ober, DeNichilo.

Anyone who’s lived in an HOA knows the guidelines and covenants can be rigid but some are just downright strange. Here are some of the most outrageous rules that an HOA can—and has—enforced.

2. Trash cans must be put away immediately after service

Most HOAs have rules against leaving trash cans on the curb on non-pickup days, but one Florida HOA took it a step further by removing the trash cans of 80 residents and dropping them off at a recycling plant. Their misdeed? Repeatedly leaving their trash cans out.

After numerous complaints from rules-abiding residents, the HOA warned in an email that any lingering cans would be removed.

To read more, click here

My comments: Worth reading. FYI, trash cans are often a big controversy. Why does this matter to appraisers? This can effect the marketability of a home. I have seen way too many problems with HOAs, particularly regarding dues and assessments. I will never live anywhere with an HOA. I read the full HOA documents and try to get copies of recent newsletters. I check to see if any are posted on bulletin boards when doing the appraisal.

The May issue of Appraisal Today will have a review of an excellent book: The Valuation of Condominiums, Cooperatives, and PUDs. The best book I have ever read on this topic. Available from the Appraisal Institute. I don’t think it includes Weird HOA Rules


Once Upon a Time… A Housing Fairy Tale

Excerpts: Once upon a time, there was a rich nation which valued many things. There were many owners and “wannabe” owners. The owners wanted to be richer and the wannabes wanted to be like the owners. They all liked value. Some people even became “valuers of things.” They claimed to know value.

Value was price. It was obvious. Nothing to talk about here. Move along.

The owners needed money they didn’t have. So, they got help from loaners.

The loaners put up most of the money and became interested. The loaner-owners also wanted to be rich. They could get rich by “selling money!” (Actually, they were only renting the money, but no one wanted to hear that.)

Suddenly, when no one was looking, value was not price. Everyone got mad. Someone must be at fault! Someone had to pay the price! It must be the uppraisers. They caused the prices to be “too high” – until they became “too low.” The uppraisers got in trouble! And now, no one seems to know what “correct” value is. It’s either too high or too low.

To read the rest of the Fairy Tale, click here
My comments: Very interesting story!! One of the best I have read ;>


Nearly Half Of Home Sellers Are Making Concessions To Woo Buyers

March 15, 2023


  • Sellers are offering to cover the cost of repairs, mortgage-rate buydowns and closing costs as rising interest rates dampen homebuyer demand.
  • Pandemic boomtowns and pricey coastal markets, including Phoenix and Seattle, have seen the biggest increases in concessions.
  • A record 13% of home sales include a price cut and a final sale price below the list price in addition to a concession.

Home sellers gave concessions to buyers in 45.5% of home sales recorded by Redfin agents during the three months ending February 28, up from 31.1% one year earlier. That’s the highest share of any three-month period in Redfin’s records, which date back to June 2020.

To read more, click here

My comments: What’s happening in your market? Don’t miss considering the effect of concessions on your appraisal values!


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, click here.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 go to www.appraisaltoday.com/order Or call 510-865-8041, MTW, 7 AM to noon, Pacific time.

My comments: Rates are going up and down. Most lender appraisers are very slow.


Mortgage applications increased 2.9 percent from one week earlier

Mortgage applications increased 2.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 24, 2023.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 3 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week and was 61 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index increased 2 percent compared with the previous week and was 35 percent lower than the same week one year ago.

“Application activity increased as mortgage rates declined for the third straight week. The 30-year fixed rate declined to 6.45 percent, the lowest level in over a month,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “While the 30-year fixed rate remained 1.65 percentage points higher than a year ago, homebuyers responded, leading to a fourth straight increase in purchase applications. Home-price growth has slowed markedly in many parts of the country, which has helped to improve buyers’ purchasing power. Purchase applications remain over 30 percent behind last year’s pace, but recent increases, along with data from other sources showing an uptick in home sales, is a welcome development.”

Added Kan, “Refinance activity also picked up last week, but remains 61 percent below last year’s pace. Most homeowners still have rates significantly lower than current levels, leaving only a small pool of borrowers with an incentive to refinance.”

The refinance share of mortgage activity increased to 29.1 percent of total applications from 28.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.7 percent of total applications.

The FHA share of total applications remained unchanged at 12.3 percent the week prior. The VA share of total applications decreased to 11.6 percent from 11.7 percent the week prior. The USDA share of total applications remained unchanged at 0.5 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.45 percent from 6.48 percent, with points decreasing to 0.62 from0.66 (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 $726,200) decreased to 6.27 percent from 6.30 percent, with points decreasing to 0.54 from 0.55 (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 increased to 6.33 percent from 6.32 percent, with points decreasing to 0.93 from 1.07 (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 5.84 percent from 6.02 percent, with points decreasing to 0.57 from 0.60 (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 5.62 percent from 5.58 percent, with points increasing to 0.91 from 0.75 (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
1826 Clement Ave. Suite 203 Alameda, CA 94501

Phone 510-865-8041

Email  ann@appraisaltoday.com


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