real estate market

Covid-19 Residential Appraisers Tips on Staying Safe

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Appraiser Mistakes

By Ann O'Rourke on September 7, 2019 / adjustments, bifurcated appraisals, george dell, hybrid appraisals, Mortgage applications, mortgage loan volume, real estate market, weird homes, weird properties / Leave a comment

Tags: adjustments, bifurcated appraisals, Hybrid appraisals, mortgage loan volume, real estate market, unusual buildings, unusual homes, weird properties

Can Smart Appraisers Make Dumb Mistakes?

By George Dell, ASA, MAI, SRA

Excerpt: I am a smart and educated, award-winning appraiser. It is not possible for me to be irrational. Of course not. You can see that. I can see that. But appraiser mistakes are not good.

A high IQ and education won’t necessarily protect you from highly irrational behavior—and it may sometimes amplify your errors. David Robson, in an Excerpt from The Intelligence Trap

Oh No! Who is this guy!? Doesn’t he know how smart I am? Why, even my peers have said I am smart. I pride myself on my critical thinking. Even my kids say that! What more proof do you need? Let’s get this straight: I am rational, smart, of high IQ and extremely educated, especially in my chosen field!

Recently, scientists have started to measure what things go with irrationality. There is even a name for this field of study, this measure: dysrationalia. The studies roughly parallel the studies of dyslexia and dyscalculia (difficulty in dealing with number things).

Understandable, Well Written and Interesting!! To read more, click here

Covid-19 Residential Appraisers Tips on Staying Safe

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99.99% price drop from $1 billion. Appraisal Challenge

By Ann O'Rourke on August 30, 2019 / appraisal how to, AVMS, Mortgage applications, real estate market / Leave a comment

Tags: appraisal how to, AVM, bifurcated appraisals, mortgage loan volume, real estate market, unusal homes

Once listed for $1 billion. Sold for $100,000. What just happened?

Excerpt: A heated court battle, a last-second offer and a sparsely attended auction behind a fountain in Pomona — this chapter of the famed Mountain of Beverly Hills ends not with a princely sum but a sale price more like that of a sports car. 99.99% price drop from $1 billion. Appraisal Challenge.

Touted as the city’s finest undeveloped piece of land, the 157-acre property redefined the luxury market when it listed for a record $1 billion last year. On Tuesday, it sold for a mere $100,000 at a foreclosure auction, a fraction of the $200-million loan outstanding on the property.

A markdown of 99.99%, of course, comes with some fine print. Any other buyer would have been on the hook to repay that loan — and this buyer has to eat that loss

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My comment: Quite a story!! Only in LA, of course!! FYI, I am in Northern CA… very different here. We think we are superior to LA ;>

Covid-19 Residential Appraisers Tips on Staying Safe

Appraising Weird Stuff is Challenging!

Appraisal Process Challenges

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Property inspection issues for appraisers

By Ann O'Rourke on August 4, 2019 / appraisal business, george dell, Mortgage applications, real estate market, statistics, unusual homes, weird homes, weird properties / Leave a comment

Tags: appraisal business, mortgage loan volume, real estate market, unusal homes, unusual buildings, weird properties

Nothing New Under the Sun: The Varied Face of Appraisal Property Inspections

By Joshua Walitt

This article focuses on property inspections, which – to an outsider – might seem to be a straight-forward topic. However, given current changes in the valuation space, nothing is further from the truth: valuation, specifically the collection of data that supports a valuation method, has never been one-size-fits-all. There are many property inspection issues for appraisers

Excerpt: Sample of the questions about data sources:

The appraiser determines physical characteristics of the subject structure from limited-data county records, recent family photos showing two rooms, and a 15-year old appraisal.

A determination must be made whether appliances and utilities are functional and/or whether the property meets local codes

An appraiser performs an Exterior-from-street appraisal and reports a value opinion of $500,000; the next week, she performs a Exterior-and-Interior appraisal on the same property and reports a value opinion of $630,000.

To get the answers and more questions click here

My comments: Worth reading. Summary of a recent presentation by Walit. Lots of different scenarios presented. Note: I publish a graph of mortgage orgination 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.

Covid-19 Residential Appraisers Tips on Staying Safe

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Appraisal vs Zillow vs AVM which is best

By Ann O'Rourke on July 26, 2019 / adjustments, AVMS, deminimus, FHA, forecast, future, Mortgage applications, real estate market, weird properties, zillow / Leave a comment

Tags: adjustments, deminimus, FHA, weird properties, zillow

Appraiser vs. AVM vs. Zestimate… Ten Properties

Excerpt: On a regular basis, my opinion of value of a property I am appraising, is frighteningly similar to an AVM’s value. While that is the case, as you will see in this article, that is not always the case. You might be wondering what an AVM is? AVM stands for Automated Valuation Model. It is a computer program that uses mathematical modeling to derive a value based upon the data it is provided.

In this article I differentiate the typical AVM from Zillow’s Zestimate because Zillow claims to be more accurate than other AVM’s, due to the technology they use. Zillow’s Zestimate is an AVM.

To read more, click here

My comment: Try this on appraisals you have recently done and see the accuracy in your market. Read the article comments and leave your comment.

Covid-19 Residential Appraisers Tips on Staying Safe

Automated Valuation Models for Appraisals

Zillow (in) accuracy

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Zillow uses home photos for “appraisals”

By Ann O'Rourke on July 8, 2019 / appraisal how to, appraisal waivers, appraiser shortage, real estate market, state appraiser regulators, weird properties, zillow / Leave a comment

Tags: appraisal how to, appraisal waivers, mortgage loan volume, real estate market, weird properties, zillow

Zillow – the past and the future

Zillow’s new photo algorithm

Zillow’s New algorithm uses photos of your home to check quality and curb appeal plus a look back at when Zillow started, and info on their ibuyer service

Excerpt: “We’ve taught the Zestimate to discern quality by training convolutional neural networks with millions of photos of homes on Zillow, and asking them to learn the visual cues that signal a home feature’s quality,” Stan Humphries, Zillow’s chief analytics officer & chief economist, said in a Medium post announcing the new algorithm. “For instance, if a kitchen has granite countertops, the Zestimate now knows — based on the granite countertop’s pixels in the home photo — that the home is likely going to sell for a little more.”

To read more, click here

My comment: I am trying not to think about this…… Maybe North Dakota can try using Zillow on their rural properties….

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Zillow – tales from when it started plus ibuyer

Excerpt: Every night for five months before the launch of Zillow’s website in February 2006, employees gathered their Dell desktops on Ping-Pong tables, connected them to harness their combined processing power, and strung together extension cords to get them all running. To avoid overloading the circuits, they unplugged the office refrigerator and banned Christmas lights. Then, while most of them slept, this jury-rigged supercomputer analyzed a decade of property records and American housing market data in order to spit out price estimates for 43 million homes.

To read more, click here

My comment: Published in Forbes. Well written and researched. I liked Zillow’s history plus a good analysis of their ibuyer service – the new wave of purchasing homes and selling them later.

Covid-19 Residential Appraisers Tips on Staying Safe

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Practical real estate appraisal writing tips for AMC questions

By Ann O'Rourke on June 28, 2019 / AMCs, appraisal how to, appraisal management company, bad appraisers, bifurcated appraisals, Fannie, hybrid appraisals, Mortgage applications, real estate market, weird properties / Leave a comment

Tags: AMC, appraisal how to, appraisal management company, Bad appraiser, Fannie, Hybrid appraisals, mortgage loan volume, real estate market, unusual buildings, weird properties

Write Like A Professional – Very Practical Writing Tips for AMC/underwriter questions

By Tim Andersen

Excerpt: QUESTION: I like to use the term, “in my professional opinion” as part of my reports. After all, I am a professional paid to express opinions. Recently, the reviewer for an AMC requested I remove that term from my report since, in her words, “…it has nothing to do with value”. Is the reviewer overreaching on this? The reviewer has the right to tell me if there is an error in my report, but not to criticize the language I use in my report. What should I do?

ANSWER: As Gertrude Stein was supposed to have said upon seeing Oakland, California for the first time: “There’s no there there!” For good or ill, the same may be said about many real estate appraisal reports and the convoluted language they insist on using…..

Excellent and practical. To read more click here

My comment: this is the best article I have ever seen for practical tips on how to reply to AMC/underwriter questions with lots of examples.

Covid-19 Residential Appraisers Tips on Staying Safe

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Appraiser values are developed and are not guesses

By Ann O'Rourke on June 21, 2019 / adjustments, appraisal business, appraisal regulations, bifurcated appraisals, Fannie, Mortgage applications, mortgage loan volume, real estate market, unusual home / Leave a comment

Tags: adjustments, appraisal business, Fannie, mortgage loan volume, unusal homes

Valuation Is Not A Guessing Game, It’s a Development Process

Excerpts: If you’ve ever had an appraisal of your home completed, perhaps you can relate to the following scenario. Appraiser values are developed and are not guesses.

The appraiser arrives at your home. You know that they have probably done a little research on what potentially comparable sales in the neighborhood are selling for.

The appraiser views each room in your home, taking photos and notes as they go. The appraiser asks you about any improvements you have made to your home in recent years.

At the end of the inspection, you assume that the appraiser has to have some idea about what the value is likely to be. You ask the appraiser, “Well…What do ya think?” What you’re probably really wanting to know is what the appraiser thinks your home is worth. At this point the appraiser is likely to give an evasive reply that doesn’t answer your question. Why?

To read more and see the funny animated fotos and gifs click here

My comment: written for homeowners, but some good ideas for appraisers. You can use for ideas for speaking to real estate agents, for example. Or, can give (or send) the owner a link to this article.

Covid-19 Residential Appraisers Tips on Staying Safe

Zillow CEO sold his home for 60 percent of the Zestimate

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Suburb not well defined for appraisals

By Ann O'Rourke on June 14, 2019 / appraisal regulations, Fannie, FHA, forecast, lender appraisals, mortgage loan volume, real estate market, weird properties / Leave a comment

Tags: appraisal regulations, Fannie, FHA, Hybrid appraisals, mortgage loan volume, real estate market, weird properties

How Should We Define the Suburbs?

Excerpt: The problem (lack of a definition) stems from the fact that U.S. statistical agencies (the Census Bureau and Office of Management and Budget) do not provide a systematic definition for suburbs. They offer classifications for metropolitan areas and micropolitan areas, a classification of urban and rural areas, and a category of principal cities, but nothing of the sort for suburbs. But, suburb not well defined for appraisals.

Very interesting with a good table To read more, click here

My comment: Appraisers have to identify on forms if a property is urban/suburban/rural. Also percent built up. Rural can affect loans sometimes. I have never seen any clear definitions. Now I know why!

Covid-19 Residential Appraisers Tips on Staying Safe

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Price per square foot not very reliable for appraisals

By Ann O'Rourke on June 7, 2019 / Fannie, hybrid appraisals, lender appraisals, mortgage loan volume, real estate market, square footage, Strange homes, unusual home / Leave a comment

Tags: Fannie, Fannie forms, humor, Hybrid appraisals, strange house, unusal homes

Why price per square foot is not the appraisers choice

By Rachel Massey

Excerpt: Often, buyers and sellers are under the impression that it is simple to price a house by its square footage. Nothing is further from the truth, unless of course, all the comparable properties considered are within a couple square feet of each other and have the same quality and condition and are in the same immediate neighborhood with no variation in the value of the site.

Underneath all is the land. This means that a house that sits on a hypothetical 60×120 sqft site should have the same underlying value if the house were 1,000 sqft or 2,000 sqft. If land is selling for $50,000 for this 7,200 sqft lot, then the value of the land does not change in value because it has a larger or a smaller house on it.

For more information and to check out the graphs click here

My comment: Good explanation and graphs. Written for buyers and sellers but a good explanation when you are trying to explain why Price per sq.ft. often is not reliable. Also, a very good blog post marketing to buyers, sellers and real estate agents.

Covid-19 Residential Appraisers Tips on Staying Safe

When 1,000 square feet doesn’t count in an appraisal(Opens in a new browser tab)

What is Included in Appraisal Square Footage?(Opens in a new browser tab)

Tax records and Square Footage in Appraisals(Opens in a new browser tab)

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