How is Appraisal Gonna Change?By George Dell
Excerpt: What new “appraisal methods and techniques” have we seen? As I speak to reviewers who see valuations from around the country, there seems to be a degradation of quality. Less analysis rather than more. Less explanation rather than clearer logic. More “trust me” and less “see my reasoning.”
What does the world really need? Trust my opinion-or see the result? Trust my comps-or see market parameters.
Competitors for valuation, risk, and investment needs want “better, faster, cheaper.” For now, lets just look at “better.” What is “better?”
“Better” is actually fairly simple. There are only three parts: 1) is the right question being asked; 2) is the result true (accurate); and 3) how sure (precise) is the result? So, let’s look briefly at each of these needs, and how each can be helped with today’s technology.
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The problem of giving too much weight to previous sales (or not enough)By Ryan Lundquist
Excerpts: It must be worth more than it sold for in the past, right? In many cases, YES. But sometimes NO. Let’s talk through some things to consider when pulling comps and noticing a previous sale. I find many of these points coming up lately in conversation, so I hope this is helpful.
8 issues are discussed.
Here are a few
2) Unique property:
3) Unicorn buyer overpaid
8) Not penalizing because it sold too low
Closing advice: I recommend paying close attention to previous sales to get clues to understand how a property fits into the market. But don’t get so stuck that you don’t see the most important thing – current comps.
Good topic I have not seen discussed in detail before. Worth reading. Lots of comments!!
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The Property Valuation Reckoning is ImminentHow Technology is Highlighting Underwriting’s Shortcoming
Excerpt: some high-level aspects that can be used to get conversations started.
1. Increasing the availability of detailed, property-specific information, including both operational (ongoing) activities and transactions (sale, refinance, etc.).
2. The collection and analysis of macroeconomic, microeconomic, and capital markets influences that affect the real estate industry.
3. Using concepts such as systems thinking, systems engineering, and advanced technology such as artificial intelligence, machine learning, and deep learning to design semi-automated models that capture and make sense of both property-specific and larger capital markets factors.
Very interesting ideas and analysis. Long, but worth reading. FYI PropTech is a newish acronym. See the next link.
What is PropTech?
My comment: The article gives commercial examples, but is relevant for residential. I have been watching commercial applications, such as AVMs, attempted since the 1990s. The biggest problem is the lack of data. Costar is the major source of data in many areas and has not allowed its data to be commercially used by AVM developers, as far as I know. For leased commercial properties you must have income and expenses, which is not always available. For some types of non-leased properties, such as owner occupied warehouses, AVMs could work well. |
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7 Women in the Building Business, Including an AppraiserExcerpt: In 1986, when Dina Miller, her brother, Jonathan, and other family members founded the real estate appraisal firm Miller Samuel, “there were very few female appraisers,” said Ms. Miller, 56, whose specialty is specialty work – determining the value of a common hallway that a co-op shareholder wants to buy, for example, and handling stratospherically expensive property, including the top-floor apartment at 432 Park Avenue.
Scroll down the page to Dina Miller
My Sister, My Business Partner Gets Her New York Times Due By Jonathan Miller
Excerpt: The New York Times weekend real estate section has a cover story The Boss? You’re Looking at Her: 7 Women in the Building Business and my sister Dina was one of them. I’m very proud of her. She, myself and my wife are the principals of our firm Miller Samuel we co-founded with our parents in 1986. Dina is not a public person like I seem to be but has often said her brother (me) “never met a microphone he didn’t like” which I wear as a badge of honor. Congrats to my sister for her well-deserved recognition.
My comment: Not often an appraiser is featured in an article in a major national publication!! Hardly ever is it a female appraiser. —————————————————————– |
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Bolwoningen Ball Houses Excerpt: Bolwoningen consists of 50 sphere houses. The balls are made of cement, reinforced with fiberglass. They are mounted on the base in the form of a cylinder. Each sphere’s diameter is 18 feet and each has 11 round windows. The layout of these structures is quite unusual. In the center of the sphere there is a bathroom and a tiny bedroom, and a living room and kitchen, are located on the second floor-level. The house can be completely disassembled and transported to any other place (the weight of this building is only about 2755 lbs). In addition, this building can be placed not only on the ground, but also on water, on a stationary platform.
Locals didn’t quite appreciate the vision of the architect, but there are plenty of tourists, who would love to visit or even experience living in these futuristic houses.
My comment: Fascinating!! It was built in 1984 and is surrounded by standard homes. Check out the 2 links above and/or google bolwoningen ball houses
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What Would Happen if There Were No Appraisers?By Tom Horn
Excerpt:
7 Consequences of Eliminating Appraisers From Mortgage Transactions
1) Questionable accuracy due to faulty county records
2) No reconsideration of values
3) No critical thinking that takes into consideration nuances of the market
Click here for more commentary and to see the other 4 reasons.
My comment: Very good analysis!! Needs to be sent to all the people who say appraisals are not needed…
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What’s 8 Feet Wide and Has an Elevator? Manhattan’s Tiniest Fancy Townhouse – asking $5 million.Excerpts: On a cobblestoned lower Manhattan street near the approach to the Brooklyn Bridge, a four-story house is about to go on the market for $5 million. The widest room measures 10 feet.
Small houses have a long history in New York. A Dutch-style gabled house at 75 ½ Bedford St. in Greenwich Village built in 1873 is 9 ½ feet wide. It is “popularly known as the smallest house in the city,” according to the city’s landmarks preservation commission. Its tenants have included poet Edna St. Vincent Millay, and anthropologist Margaret Mead.
My comment: I wonder what an 8 ft wide floor plan, with an elevator, looks like???
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7 Quick Tips for Using Appraisal TemplatesExcerpt: Use these tips for proofreading appraisal reports:
5. Proofread Will a few typos or misspellings ruin your appraisal career? Probably not. However, they do seriously undermine your professionalism and suggest that you lack attention to detail. Take the time to ensure you are putting forth polished reports.
Focus on your most recent edits. When you edit something, it’s easy to introduce new errors, such as missing or repeated words. Proof new content and comments two to three times after you edit them, but also home in on those areas again during your final proof.
For more very good tips that we can all use click here:
My comment: I use a few templates for form reports and my assistant has to very carefully check each appraisal I writeup to be sure everything is okay! I gotta make sure I change the effective date of the appraisal and signed dates around the first of the year, of course…
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$245M Bel Air CA mansion is nation’s most expensive listingOriginally listed for $350M, it’s still a potential record-breaker after a price cut
Excerpts: The limestone clad mansion in Bel Air owned by the late TV executive Jerry Perenchio just got a price cut.
But at $245 million, the commanding French neoclassical residence, which measures 25,000 square feet, is still the most expensive listing on the open market in the U.S.
The property, which came up for sale last year for a staggering $350 million, has long been the cream of the crop among high-end estates…
A 105,000-square-foot mega-mansion built on spec, also in Bel Air, has a ridiculous $500 million price tag, but it’s not listed on the open market.
My comment: And I just read that the Southern California market is in a slump… who knows about this price range ;>
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Living Beneath the Ground in an Australian DesertFor about a century, residents of Coober Pedy have escaped the searing heat by building their homes underground.
Excerpt: “Bars and restaurants are underground, churches, all these children growing up living underground,” Ms. Merino said in a telephone interview about the residents’ social and private lives. “There’s nothing different about them; they’re not cave men. They’re normal people choosing to live in a different way.”
My comment: I have been reading about this place for awhile, but the author, who “stumbled upon” it has an excellent Fascinating article with great photos!!
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A Map of every building in AmericaExcerpts: Classic maps answer questions like: How do I get from Point A to Point B? These data images, instead, evoke questions – sometimes, simply: What’s that?
We found fascinating patterns in the arrangements of buildings. Traditional road maps highlight streets and highways; here they show up as a linear absence.
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In the August 8 2018 issue of this email newsletter, I published the link
Visualizing the Hidden ‘Logic’ of CitiesExcerpt: Some cities’ roads follow regimented grids. Others twist and turn. See it all on one chart.
Excerpt: In Chicago or Beijing, any given street is likely to take you north, south, east, or west. But good luck following the compass in Rome or Boston, where streets grew up organically and seemingly twist and turn at random.
Fascinating!! Check it out at:
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8 Dome Homes Ideal for Well-Rounded BuyersExcerpt: Geodesic dome homes always strike a chord with buyers looking for a different type of house.
They’re also in favor these days thanks to their cosmic, forward-looking designs. Futurist and architect Buckminster Fuller conceived the geodesic dome in the belief that the shape of these rounded dwellings was the most efficient use of resources possible, and that the homes were ideal for mind, body, and spirit.
Here are a few:
– 37849 W Johnson Lake Ln, Marcell, MN Price: $129,000
– 35685 Lake Summit Dr, Temecula, CA Price: $775,000 – Two connected domes
– 5825 E Saguaro Rd, Cave Creek, AZPrice: $469,000 – Price includes a large maze
Check out the fotos and info at:
My comment: They all kinda look the same to me ;> I have never appraised one, but don’t miss it. Very few here. Just use other odd ball properties as comps I guess. There is one in a nearby city that I drive by regularly as a reminder of what I don’t want to appraise ;> =============================================
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Is the market tanking or softening?Video by Ryan Lundquist
About the Sacramento CA market, but applies to all markets
21 minute video. Worth watching.
More articles by Ryan at http://sacramentoappraisalblog.com
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Malibu Pyramid House in 3-D and Drone ViewJust For Fun!!27553 Pacific Coast Hwy, Malibu, CA
Price: $5,695,000
Why it’s here: Here’s your prime directive: Live in the futuristic home as seen on season 3 of “Star Trek: The Next Generation.” Designed by Ellis David Gelman, the well-maintained and playful space features “four eclectic bedrooms,” an ocean-view terrace, and lavender and rose gardens spread over 2 acres.
See it in 3-D, Drone view, and lotsa photos here!!
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Is a la mode’s Smart Exchange Really a Smart Idea?Excerpt: Alamode recently launched Smart Exchange to its users. The idea is appraisers can see what others have stated as property characteristics and transfer that information directly into your report. The system is based on mutual sharing, so if you participate, you will share all your comparable data with everyone else that is using Smart Exchange and you can see their data.
Lots more info plus appraiser comments at:
My comment: I have never used a la mode software, but do follow the Yahoo Group WinTOTAL. Lots of discussion there also. Of course, I am suspicious because Corelogic owns a la mode.
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