GSEs Create Exception for UAD 3.6 Deadline for Approved Lenders

By on October 2, 2026   /   adjustments, GSEs, state appraiser regulators, UAD 3.6   /   Leave a comment
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Newz: GSEs Create Exception for UAD 3.6 Deadline for Approved Lenders Through May 19, 2027, Weather Impact on Appraisals

October 2, 2026

ARTICLE LIST – Scroll down the page to read

  • LIA AD: Weather Impact
  • GSEs Create Exception for UAD 3.6 Deadline for Approved Lenders Through May 19, 2027, Plus ACI Update, By Frank Andorka, Managing Editor, WorkingRE
  • Palm Beach’s Landmark ‘Ham and Cheese House’ Is Listed for an $105 Million
  • MY AD: Disciplinary Proceedings: What Conduct Leads to Discipline? By Claudia Gaglione
  • The Mathematics of Judgment By Dustin Harris
  • Fewer Appraisers. Better Appraisers. Which One Are You Going to Be? By Dustin Harris
  • MY UAD 3.6 UPDATE – ACI NEWS:Only the desk top version is withdrawn. The cloud base program still works.
  • 18th Annual Appraisal Summit in Las Vegas – Oct. 31-Nov. 3, 2026.

Hear what the GSEs say about Nov. 3. All the software vendors will be there – demos, questions. Network with appraisers.

HAVE FUN! OCTOBER 31 IS HALLOWEEN!!

  • MBA stats: Mortgage applications decreased 6.0 percent from one week earlier

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GSEs New Exception for UAD 3.6 Deadline for Approved Sellers : Runs through May 19, 2027
PLUS ACI UPDATE

By Frank Andorka, Managing Editor, WorkingRE

Approved sellers who are unable to fully implement UAD 3.6 before the formal Nov. 2, 2026, deadline will be allowed to continue submitting legacy UAD 2.6 appraisal reports through May 19, 2027, according to Fannie Mae and Freddie Mac.

The GSEs will also allow resubmissions of UAD 2.6 appraisal reports through June 27, 2027. As of March 1, 2027, UAD 2.6 appraisals will no longer qualify for certain appraisal-related representations and warranties relief.

From March 1 through May 19, 2027, UAD 2.6 reports will receive a Collateral Underwriter® (CU) risk score of 999 when submitted to Fannie Mae, and their functionality will be reduced in both CU and Loan Collateral Advisor®. The GSEs encourage sellers to fully adopt UAD 3.6 as soon as possible, as this is a one-time policy exception that will not be extended.

“Many lenders are submitting UAD 3.6 appraisal reports; however, some lenders may need more time to adopt,” the GSEs said in the release announcing the exception.

Submitting a UAD 2.6 report after Nov. 2 will require explicit approval from the GSEs. To request a policy exception, a representative of the seller who is authorized to enter into a binding contract must complete the online UAD 3.6 Policy Exception Request for each GSE to which it sells loans.

To read the GSE UAD 3.6 Policy Exception documents, Click Here

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ACI Update

In a perhaps unrelated announcement the day before (September 29, 2026) the GSEs announcement, ACI, an appraisal software that has been serving appraisers for decades, signaled that they were scrapping ACI Sky™ Workbench, it’s UAD 3.6-compliant appraisal report.

ACI wrote on its Facebook page:

“After careful consideration, we’ve made the decision to stop the current version of ACI Sky™ Workbench and focus our efforts on developing a significantly improved Workbench 2.0 experience, targeted for release in Spring 2027…. Access to the current ACI Sky Workbench platform will end October 9, 2026.”

Appraisers in the comments on ACI’s post reported they had been in communication with ACI and were told that “there was no interim solution in place for current ACI subscribers for completing UAD 3.6 assignments,” according to one appraiser. That same appraiser quoted an email he received as saying: “At this time, the information provided to us confirms that ACI Desktop will remain available for existing UAD 2.6 and legacy workflows, but it does not provide a confirmed interim ACI workflow for completing UAD 3.6 reports after Workbench is removed.”

To read the full WorkingRE article, Click Here

My comments on Exceptions:

THIS DOES NOT CHANGE THE NOVEMBER 2, 2026 DATE FOR ALL SELLERS/ LENDERS (WITHOUT APPROVED EXCEPTIONS) TO ONLY SUBMIT UAD 3.6 APPRAISALS.

I read an online post from an appraiser about using prediction markets like Kalshi and Polymarket for The UAD 3.6 deadline of November 2. The post had several interesting comments posted.

My opinion has been No Change for November 2 for awhile. The GSEs have seen successful appraisal and lender submissions for awhile. Now they have a way to keep the deadline with one exception.

I am not surprised. I have known for a long time that the “weak link” is the lenders not the appraisers. Appraisers just have to learn how to do the changes in reporting. Lenders have to redo their computer systems for all the changes.

I attended two event sessions where GSE representatives were speaking. I asked them about what was happening with lenders. They did not say much.

I was available to find very little help for lenders online.

What appraisers need to do – a few ideas

Learn about the new Exceptions and what is required. It is complicated.

To read the GSE UAD 3.6 Policy Exception documents, Click Here

When a lender requests an appraisal be sure you both agree on what type of appraisal will be needed: UAD 3.6 or 2.6. Get the request in writing.

To be sure, you could ask if they have an approved Exception. Then you will know they will be submitting a UAD 2.6 appraisal.

A few ideas from Doug Smith

1. Keep training on 3.6. The exception postpones the deadline for some lenders. It doesn’t retire the format.

2. Get the format in writing. On every order after Nov 2, confirm 2.6 or 3.6 in the engagement letter, especially for FHA and VA.

3. Ask lender clients whether they’ve requested the exception from one GSE, both, or neither.

4. Expect a dual-track transition. Some clients will still order 2.6 into 2027. Others will move early to avoid the March 1 penalties.

Status of FHA and VA – unknown currently. Lots of rumors and comments.

In future Friday newsletters I will let you know more, as it becomes available. It is complicated. I received notification of these new exceptions on September 30, 2026. I had limited research time available before my newsletter deadline on October 2, 2026 at 6:30 AM.

Many thanks to WorkingRE for writing this article on November 2026 about the new GSE Exception changes and ACI update!

Read more!! →

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New Fannie Highest and Best Use Playbook

By on September 25, 2026   /   AI, appraisal, appraisal how to, Fannie   /   Leave a comment
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Newz: New Fannie Highest and Best Use Playbook, UAD 3.6 Nov. 2 and Other Deadlines??

September, 25, 2026

ARTICLE LIST:

In Order, Scroll down the page to read

  • LIA AD: Conflicting Assignments and Professional Ethics
  • New Fannie Highest and Best Use Playbook and Q&As
  • For the Price of a San Francisco Condo, You Can Buy a 400-Acre Historic Marshland Retreat
  • UAD 3.6 — Whose November 2 Deadline Is It? There are many dates!! By Doug Smith, SRA
  • MY AD: Make use of your driving time by exercising
  • Rethinking Private Appraisal Delivery: Building Interactive Web Reports with AI By Dustin Harris
  • MBA stats: Mortgage applications decreased 1.5 percent from one week earlier

 

Thanks to our Sponsor!!!

Very reasonable prices and good open rates for our ads!

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New Fannie Highest and Best Use Playbook and Q&As

By Dave Towne

For those of you doing (or will do) the New URAR/UAD 3.6 mortgage lending reports from now into the future, you need to read and understand this new policy change from FannieMae. Because this new UAD report process also applies to FreddieMac, my presumption is they will issue a policy statement of their own with similar wording.

For the time being, here is the FNMA new policy, issued on Sept. 2, 2026: Highest and best use requirements for Uniform Appraisal Dataset (UAD) 3.6

This policy updates the highest and best use requirements for appraisal reports completed using Uniform Appraisal Dataset (UAD) 3.6.

These changes apply only to UAD 3.6 appraisal assignments to support the new Uniform Residential Appraisal Report (URAR) reporting requirements and do not apply to appraisal reports completed using legacy appraisal report forms.

We updated our policy to:

• require the property’s highest and best use, as improved or as proposed, to be a residential use, rather than requiring it to be the property’s present use;

• define present use, residential use, and subordinate use in the context of highest and best use;

• require the property to be a primarily residential one- to four-unit property, with any non-residential use subordinate to the residential use, replacing the previous “residential in nature” guidance; and

• establish the eligibility criteria and reporting requirements for one- to four-unit residential properties when the present use does not satisfy one or more of the highest and best use tests.

The UAD 3.6 Policy Supplement has been updated to reflect these changes.

Effective: This policy change is effective immediately for appraisal reports completed using UAD 3.6.

Remember, to be USPAP compliant, you can’t “just check the box” on the New URAR/UAD 3.6 data base input field (or on the Legacy forms either) to indicate ‘present use,’ and then move on. You must add a written statement in that site section comment input field explaining why you decided that is the accurate use of the property. Craft your statement to comply with the above policy.

Also remember this: if you decide the property’s H&BU is not Residential use, you must check the box “No.” In most cases, when you do that, the need to complete a full appraisal report ends at that point because the lender cannot proceed with a residential mortgage loan. Your statement needs to define what the actual use is if not Residential. Stop working on the report and contact your client to fully explain the current situation. Let them determine how to proceed.

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What is in Fannie’s New The Highest & Best Use 25 page Playbook (Per Fannie)

• This playbook provides key concepts and illustrative scenarios to help industry participants better understand how the results of the highest and best use (HBU) may affect loan eligibility.

• Each scenario presents a complex highest and best use question based on the specific circumstances of a subject property. While every property has its own unique characteristics and circumstances, which may lead to different conclusions, these scenarios are designed to demonstrate how you can apply Fannie Mae policy consistently across a range of situations. They are intended to provide practical guidance and support informed, policy-compliant decision-making.

• A resolution is provided for each scenario, along with the appraiser and lender responsibilities with relevant Fannie Mae Selling Guide Supplement: Uniform Appraisal Data (UAD) 3.6 Policy resources.

• The Highest and Best Use Frequently Asked Questions document addresses common questions related to present use, highest and best use, mixed-use properties, analysis of subordinate uses, comparable sales, the URAR, and loan eligibility. The document is available separately and linked throughout the Playbook for easy reference.

To read the Highest and Best Use Playbook, Click Here

To read the separate FAQ document, with 27 Q&As, Click Here

My comments: Many thanks (again) to Dave Towne for writing a summary of the 25 page document at the top of this article. To subscribe to his regular emails, send an email to dtowne@fidalgo.net . Say that you want to subscribe to his list. I have been subscribing for many years.

Read more!! →

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Surplus vs. Excess Land for Appraisers

By on August 14, 2026   /   appraisal business, appraisal how to, non-lender appraisals, UAD 3.6   /   Leave a comment
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Newz: Surplus vs. Excess Land,
Easement Issues and Liability

August 14, 2026

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: Easements: Issues and Appraiser Liability
  • Surplus Land vs. Excess Land: What Appraisers Need to Know, By Kevin Hecht
  • Built Different: How the Ranch-Style Home Went from 1930s Architectural Rebel to America’s Favorite Floor Plan
  • Let’s Talk About Letters of Engagement, By Jeff Whaley
  • MY AD: UAD 3.6 Software Evaluation Checklist
  • An Abridged History of the Appraiser Profession, By Kendra Budd, Editor Working RE
  • My UAD 3.6 Tips of the Week
  • MBA: Mortgage applications increased 3.6 percent from one week earlier

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Surplus Land vs. Excess Land: What Appraisers Need to Know

By Kevin Hecht

Excerpts: Land valuation is a fundamental aspect of real estate appraisal, influencing property transactions, development decisions, and investment strategies. A key part of the process involves distinguishing between the land that supports the property’s current use and any additional land that may or may not have independent value.

Commonly, a square footage adjustment is made based on lot size differences among comparable properties without one key distinction: whether the difference in land is surplus or excess land. This fails to consider whether the extra land has value independent of the subject property.

Surplus land generally does not contribute value beyond its association with the primary parcel, though it may still add some contributory value in certain market conditions. Excess land, by contrast, has value because it can be divided and sold separately.

Understanding this distinction is essential for developing a credible appraisal.

Surplus Land vs. Excess Land at a Glance

Surplus Land – Cannot be separated and sold independently

Excess Land – Can be divided and sold separately

Surplus Land – No independent highest and best use

Excess Land – May have a different highest and best use

Surplus Land – Typically contributes limited additional value

Excess Land – Has independent value and should be analyzed separately

Surplus Land – Remains part of the primary property

Excess Land – Can potentially support separate development

Key Differences Between Surplus and Excess Land

Surplus and excess land apply to commercial and residential properties. Before determining whether land is surplus or excess, appraisers must consider zoning, highest and best use, surrounding properties and their use, property improvements, and supply and demand for the property and any proposed improvements.

Why the Distinction Matters in Appraisal

Choosing the correct land type has an effect on the final value of the property. Excess land adds value to the subject property and creates future potential. Thus, a higher price per square foot should be assigned to excess land over surplus land.

Ultimately, identifying land type is about more than just checking if a property can be split. It’s about understanding the property’s most productive use under current legal and economic conditions.

To read more, Click Here

My comments: Read this article!! The best comprehensive article I have read on this issue. Understanding Surplus vs. Excess Land is critical in appraising. I have encountered this issue mostly in commercial and agricultural appraisals. It can happen in any type of property.

Unfortunately, residential lender appraisers sometimes encounter this but don’t know much about it. I have appraised it on single family properties. Not understanding what this is of the many ways residential appraisers end up trouble at the state appraisal board because of lack of knowledge and experience.

Read more!! →

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The Appraiser Exodus and How to Fix It

By on May 8, 2026   /   appraisal business, appraisal how to, Appraisal Institute, UAD 3.6   /   Leave a comment
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Newz: Expanded Intended Users?

The Appraiser Exodus and How to Fix It.

May 8, 2026

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: Expanding Intended Users? Not So Fast
  • Under Pressure: What’s Driving the Appraiser Exodus and How to Fix It, By David Massey
  • Historic Tudor Estate With English Gardens and Prairie Views Is Listed for $4.7 Million Near Chicago
  • What is a Pre-listing appraisal? Written for Home Owners But Has Good Tips for Appraisers, By Tom Horn
  • MY AD: What Happened When Government Decided That Appraisers Needed Protection, By Cindy Chance, PhD
  • How to See the Potential in Homes That Don’t Look Perfect. Written for Home Owners But Has Good Tips for appraisers
  • More Than 60% of America Is Covered by Drought and Millions of Homes Are at Risk
  • UAD 3.6 Bootcamp, LIVE in Chicago, IL and on Zoom, Wednesday – Friday, May 13th-15th
  • MBA STATS: Mortgage applications decreased 4.4 percent from one week earlier

 

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Under Pressure: What’s Driving the Appraiser Exodus and How to Fix It,

By David Massey

Ask any veteran appraiser or physician what has changed most over the past twenty years, and the answer is usually the same: paperwork.

Professions once centered on skill, judgment, and service are now dominated by portals, compliance layers, and third-party control. Burnout rises, independence falls, and a quiet exodus follows.

The American Medical Association reports that physicians now spend nearly two hours on documentation for every hour of patient care.

The appraisal profession is now well into that cycle.

According to the Appraisal Institute’s 2023 Fact Sheet, the number of practicing appraisers in the United States has declined by roughly 8,000 in recent years. The Conference of State Bank Supervisors shows a longer-term drop from about 120,000 appraisers in 2008 to fewer than 96,000 by 2017, a 21 percent decline in less than a decade. IBISWorld reports another six percent employment drop between 2018 and 2023. The U.S. Bureau of Labor Statistics projects only modest growth through 2034, far short of what is needed to replace retirees.

The pipeline is shrinking while demand remains steady.

The National Association of Realtors ® 2023 Appraisal Survey found that more than half of appraisers are now asked monthly, or more often, to complete assignments outside their normal geographic or property-type expertise. More telling, 54 percent cited Appraisal Management Companies as the single greatest challenge to their business. That statistic alone explains much of what has gone wrong.

When I started in this profession, appraisal centered on analysis, interpretation, and professional opinion. I studied neighborhoods, walked properties, and applied experience to market behavior. Today, much of the job revolves around compliance portals, redundant uploads, and layers of review by people who have never inspected a property.

AMCs were created after the 2008 crisis to protect appraiser independence. The idea made sense. The execution has failed. Today, borrowers commonly pay $600 to $700 for an appraisal, while the appraiser often receives about half of that after AMC fees. Turn times lengthen. Panel depth shrinks. Geographic competency erodes. And experienced appraisers quietly step away.

What was meant to reduce pressure has become a system of control. Communication between lenders and appraisers is filtered. Pricing is dictated by algorithms. Scope interpretations are issued by third parties removed from the field. Judgment is slowly replaced by checklist compliance.

Healthcare has already traveled this road.

A 2025 Annals of Internal Medicine study showed nearly five percent of U.S. physicians left clinical practice in a single year, driven largely by burnout and administrative burden. The American Medical Association reports that physicians now spend nearly two hours on documentation for every hour of patient care.

Appraisers now operate inside the same imbalance. More time formatting reports than analyzing markets. More time satisfying review protocols than developing defensible opinions. Judgment yields to process.

This is not a workforce inconvenience. It is a structural market risk.

The fix is not complicated, but it does require courage.

First, appraisal fee transparency must be mandatory. If a borrower pays $650 and the appraiser receives $325, both parties deserve to know. Transparency restores accountability and allows market forces to function.

To read more, Click Here

My comments: Worth reading, especially how to fix it. We all know what is happening to residential lender appraisers.

For doctors, corporate medicine has taken over. For example, primary care physicians are allowed only 15 minute visits with patients. Large insurance companies make it very difficult for patients to get the care they need by denying what the patient needs. Doctors don’t like it, plus the excessive paperwork.

I play pickleball with a retired doctor. He had to sell his medical practice as he was underbid on fees by large health insurance companies.

Read more!! →

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Appraising Solar Panels

By on April 3, 2026   /   adjustments, AI, appraisal how to   /   Leave a comment
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Newz: Solar Panels, Concessions, AI and Appraisals

April 3, 2026

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: Navigating Red Flags: a Contentious Divorce Case
  • What Is the Appraisal Value of Solar Panels? FAQs for Residential Appraisers
  • Tiny New York Home With No Bedrooms Hits the Market for a Bargain Price
  • Concessions Are Not the Price: How to Measure What the Market Is Actually Doing
  • MY AD: How to reduce stress to be more productive in business and a happier life for appraisers
  • My First 50 Years by Steve Papin
  • AI Usage in Appraisals: Trust but Verify by Jo Traut
  • MBA STATS: Mortgage applications decreased 10.4 percent from one week earlier

 

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What Is the Appraisal Value of Solar Panels? FAQs for Residential Appraisers

Excerpts:

How Common Are Solar Panels in Residential Appraisals?

Solar panels are increasingly common. Declining system costs, government tax incentives, and utility rebates have made solar PV ownership more accessible than ever. If you haven’t encountered an owned solar system on a subject property yet, there’s a good chance you will soon—particularly as more states push toward renewable energy goals.

The practical takeaway: developing a working knowledge of solar valuation now puts you ahead of the curve.

Topics:

Owned vs Leased Solar Panels—and Why It Matters for Appraisers

How Do You Determine the Appraisal Value of Solar Panels?

  • Sales Comparison Approach. This is the preferred method under Fannie Mae and FHA guidelines.
  • Cost Approach Solar PV systems are typically priced on a cost-per-watt or cost-per-kilowatt basis.
  • Income Approach This method estimates value based on the energy savings the system produces.

What Do You Do When There Are No Comparable Sales with Solar Panels? This is the question appraisers ask most often, and it’s a real challenge in many markets.

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What Are the Key Components of a Solar PV System that Appraisers Should Be Able to Identify?

How Can Appraisers Build Competency in Solar Valuation?

Solar PV systems are one piece of a broader green home appraisal niche that’s growing fast.

To read more, Click Here

My comments: Very comprehensive analysis of the important factors. I have never appraised a home (or apartments and commercial properties) with Solar. I live in a “Mediterranean” climate in the San Francisco Bay area. No big changes in weather over the year. No snow, no high heat etc. But I have heard appraisers discussing the topics above. If I appraised Solar in a home I would use this article.

Read more!! →

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Paired Sales for Appraisers

By on February 27, 2026   /   adjustments, AI, appraisal business   /   Leave a comment
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Newz: Paired Sales Analysis, AI and Appraisers?

February 27, 2026

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: When Confidentiality Agreements Conflict with USPAP
  • Paired Sales Analysis: Tips and Tools for Appraisers
  • Converted Church With Bell Tower and Pulpit Lists for $225K
  • Determining Assignment Conditions in a Vacuum By Jo Ann Aposto
  • MY AD: An Appraiser Gets Audited by the IRS! My Story Don’t Make My Mistakes! By Ann O’Rourke
  • Artificial Intelligence: Friend or Foe of Appraisers?
  • Fed moves to pull mortgages back into banking fold
  • MBA: Mortgage applications increased 0.4 percent from one week earlier

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Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news

 

 

Paired Sales Analysis: Tips and Tools for Appraisers

By Kevin Hecht

Excerpts: Though not without challenges, paired sales analysis is a valuable technique to have in your appraisal toolkit. Mastering this method will help you develop more accurate, credible, and defensible appraisals.

This guide presents a step-by-step approach to performing paired sales analysis, practical tips and tools to improve your accuracy, plus strategies to overcome common challenges like sparse comparable data.

Paired Sales Analysis Example

For example, suppose two very similar homes in the same neighborhood sell within three months of each other. One house has a separate two-car garage, while the other does not. If the garage-equipped home sold for $15,000 more, you can reasonably infer that the garage adds $15,000 in value.

Uses

Primarily used in the sales comparison approach, paired sales analysis is particularly useful for estimating the value of unique property attributes such as:

  • Location advantages (corner lots, cul-de-sac positions, or waterfront access)
  • Scenic views or privacy features
  • Property upgrades (pools, finished basements, luxury kitchens)
  • Additional structures (workshops, guest houses, storage buildings)
  • Land size variations or irregular lot configurations

TOPICS

  • What is paired sales analysis
  • Step-by-Step Methodology of a Paired Sales Analysis…
  • Paired Sales Analysis Tips and Best Practices
  • Additional Tips Shared by Appraisers
  • Overcoming Challenges: What to Do When Data Is Sparse

To read more, Click Here

My comments: Comprehensive and definitely worth reading. I have regularly used paired sales, when I could find good comps. I often go back in time, as market conditions adjustments are easy to do. I got a few new ideas I had not thought of before in this article.

Read more!! →

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How to Appraise Basements

By on February 20, 2026   /   AMCs, appraisal how to, UAD 3.6   /   Leave a comment
Tags: , , ,

Newz: Appraising Basements, AMCs,

Who is doing UAD 3.6 appraisals?

February 20, 2026

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: Limiting Liability to Third Parties
  • Basement Appraisals: Understanding Contributory Value (Updated for UAD 3.6)
  • Fascinating ‘Basement Home’ That Rises Just Inches Above the Ground Hits the Market for Less Than $160K
  • The AMCs: Coming Soon to a Lawsuit Near You
  • MY AD: The Cost Approach for Appraisers is not popular, by Tim Andersen, MAI
  • 26% of Appraisers Feel Ready: What UAD 3.6 Demand
  • Mortgage applications increased 2.8 percent from one week earlier
  • Have you received a UAD 3.6 order yet? Survey.
  • MBA: Mortgage applications increased 2.8 percent from one week earlier

Basement Issues and Values

Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news

 

Basement Appraisals: Understanding Contributory Value (Updated for UAD 3.6)

Excerpts: While homeowners may ask, “Does a finished basement add value to my appraisal?” you know the answer is a bit more complicated. A basement may impact a residential property’s value, and as an appraiser, you’ll need to evaluate its significance.

While determining the contributory value of basements isn’t overly complex, it does pose challenges. To help you out, we’ll outline essential steps and provide tips for evaluating a basement’s contributory value.

Summary

Determining how a basement contributes to a residential property’s value requires an appraiser to identify the basement type, its level of finishing, and any common concerns, like signs of mold or structural issues. Following best practices is key. This includes separating the basement from the above-grade finished area, understanding the intended use of the space, and completing comprehensive market research. By doing so, you can evaluate the basement’s contributory value more accurately

Topics include:

Types of basements (partial list)

Cellars

Partial Basements

Walk-Up Basements

How Is the Basement Finished? Determining Levels

Know the Intended Use and Client Requirements

To read more, Click Here

My comments: The best analysis and advice on basements I have seen. Watch the 7 minute video on Understanding Q/C ratings (UAD 3.6) Where I work the ground does not freeze. In my Island city there is no cemetery as the ground water from San Francico Bay is very high. Basements need pumps to remove salt water. Basement walls are not used to support the home. Sometimes there are above ground basements, basements dug out of the ground, and many other types of basements. In steep hillside areas what is a “basement” can be controversial.

In Alameda, my city, native American burials, primarily from the Ohlone people, are heavily concentrated in former shellmounds (ancient cemeteries) throughout Alameda. Almost were removed many years ago, similar to other Bay area cities close to the Bay.

Read more!! →

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Appraising with Limited Comps

By on January 23, 2026   /   AMCs, appraisal how to, forecast   /   Leave a comment
Tags: , , ,

Newz: Limited Comps, Freddie Mac: Property Data Collection, Avoiding ourt

January 23, 2026

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: Avoiding Court
  • Arriving at a Credible Appraisal When Comparable Sales Are Limited By Kevin Hecht
  • MAPPED: The Most Expensive Home Sales of 2025—From Palantir CEO’s Record-Breaking Ranch to Florida’s Priciest Mansion
  • MY AD: The AMC Conundrum in the Appraisal Business by Dave Towne
  • From Data to Value: How Mass Appraisal Delivers Fair Market Assessments
  • Freddie Mac. Insight Articles: Property Data Collection: An Overview
  • Housing Market Predictions for 2026
  • MBA: Mortgage applications increased 14.1 percent from one week earlier

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Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news

 

Arriving at a Credible Appraisal When Comparable Sales Are Limited
By Kevin Hecht

Excerpts: Limited sales activity is common in rural markets, custom-home neighborhoods, and low-turnover areas. When comps are few, the appraiser’s task is not to find perfect matches, but to show that the selected sales are the best available indicators of value and that all departures from ideal data are well supported.

In this article, we’ll answer questions like: How far back do appraisers look for comps? How far out geographically? What other tips and tricks do appraisers use to arrive at a credible appraisal, even when comps are limited? Additionally, we’ll share some insights from appraisers who answered our survey question, “What do you do when appraisal comps are few?”

When recent, proximate, and similar sales are unavailable, appraisers typically rely on some combination of the “Three D’s” to broaden their search for comparable property sales:

Dated – Search for older sales within the subject neighborhood.Distant – Search for similar sales farther away in competing neighborhoods.

Dissimilar – Search for dissimilar sales within the subject neighborhood by widening the parameters for improvements (GLA, age, features, etc.).

How Far Back Do Appraisers Look for Comps?

Time adjustments draw scrutiny. Most agency assignments expect appraisers to use the most recent closed sales available, typically within the prior 12 months when possible.1 When older sales are used, market conditions adjustments often become central to the analysis.

Time adjustments should be supported with clear data, applied consistently, and reconciled logically. Underwriters pay close attention to whether these adjustments reflect documented market behavior rather than assumptions, particularly in shifting markets.

We surveyed our appraisal community to find out, “What do you do when appraisal comps are few?” The following comments show how individual appraisers often put their own spin on the “Three D’s” when expanding the search for comparable sales:

“Time and distance. My preference is to go back farther in time within the same neighborhood and/or market area and make market condition adjustments. If that still doesn’t provide enough comps, I expand the market area, looking for more recent sales with similar characteristics to the subject property.”

“First consider a broader time frame. Market conditions adjustments are very supportable.”

“Expand search to other competitive neighborhoods. Next, go back in time.”

To read more, Click Here

My comments: I usually go back in time sometimes several years or longer if needed. Of course, I don’t do GSE appraisals with their restrictions…

 

Read more!! →

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Appraising with Inventory Shortages and Surpluses

By on December 5, 2025   /   appraisal, appraisal business, appraisal charts and graphs, real estate market   /   Leave a comment
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Newz: UAD Quality Ratings,

Appraising with Inventory Shortages and Surpluses

December 5, 2025

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: When a Property Owner Wants to Do the Appraiser’s Job
  • Understanding UAD Quality Ratings (Updated for UAD 3.6 and the New URAR)
  • Gothic-Inspired ‘Fairytale Castle’ in Miami’s Exclusive Coconut Grove Michigan Hits the Market for $24 Million
  • Navigating the Challenges of Inventory Shortages and Surpluses in Real Estate: Insights from a Chief Appraiser at a National AMC By Jim Jenkins, Chief Appraiser
  • What Is a Scatter Chart Analysis in Appraisal?
  • 53% of U.S. homes lost value in the past year, the most since 2012 – Zillow
  • MBA:  Mortgage applications decreased 1.4 percent from one week earlier

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Understanding UAD Quality Ratings (Updated for UAD 3.6 and the New URAR)

Excerpts: Quality ratings are one of the most familiar parts of UAD, but the way appraisers report them has changed under UAD 3.6 and the new dynamic Uniform Residential Appraisal Report (URAR). While the Q1–Q6 scale remains in place, the way you apply, support, and reconcile quality is more structured and data-driven than in the legacy forms.

What “Quality” Means in UAD 3.6

In UAD 3.6, quality represents the materials, craftsmanship, and construction standards of a dwelling. The familiar Q1 through Q6 framework still applies, but the workflow is different:

Quality is no longer a single, form-level checkbox.

You now provide quality ratings in multiple places:

  • Exterior Quality Rating (Dwelling Exterior section)
  • Interior Quality Rating (Unit Interior section)
  • Kitchen and Bathroom Detail tables
  • Overall Quality (reconciled in Section 15)
  • The “overall” rating is informed by the component-level data you report in these earlier sections.

Other topics include:

  • What Does UAD Stand For?
  • What Are the Quality of Construction Ratings?
  • Breaking Down the UAD Quality Ratings (Q1–Q6)
  • How Quality Is Applied in the New URAR
  • Tips for Applying Quality Ratings Credibly

Final Thoughts

Quality ratings remain an important part of UAD, but the approach is more precise now. UAD 3.6 pushes appraisers to rely on observable details rather than broad descriptions or market norms. When you follow the definitions, support your ratings with the structured data, and reconcile logically, the quality rating becomes a clear and defensible part of your analysis.

To read more, Click Here

My comments: Comprehensive and well written. Worth reading.

Read more!! →

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Appraisers – Disclose When You Did Not Do the Inspection 

By on November 7, 2025   /   AMCs, appraisal, Appraisal fees, UAD 3.6   /   Leave a comment
Tags: , , , ,

Newz: 24 Hour Appraisal, Disclose When Some One Else Did the Inspection

November 7, 2025

What’s in This Newsletter (In Order, Scroll Down)

  • LIA AD: When a Property Owner Wants to Do the Appraiser’s Job
  • The Hazards of Signing a URAR When Another Person Conducts the Inspection
  • Honolulu Diamond Head Estate for $34,000,000
  • The 24-Hour Appraisal Funded by Appraisers
  • How Policy, Data, and Technology Are Reshaping Lending and Valuation: MBA 2025 Recap
  • MBA: Mortgage applications decreased 1.9 percent from one week earlier

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The Hazards of Signing a URAR When Another Person Conducts the Inspection

By Dan Bradley

Excerpts: When using the Uniform Residential Appraisal Report (URAR) to report the results of an appraisal, the appraiser’s signature on the report is not merely a formality, it is a certification. By affixing his or her signature, the appraiser is certifying to (among other things) having personally made an interior and exterior inspection of the subject property.

Clients, AMCs, and state regulatory agencies are reporting that appraisers are increasingly delegating their inspection responsibilities to others yet are signing the URAR certifying they made a personal inspection.

What are the risks if an appraiser signs a URAR report certifying an interior and exterior inspection that was actually conducted by someone else?

Conclusion

Signing a URAR appraisal report that states the appraiser personally inspected the property, when in fact another party performed the inspection, is a serious liability risk. USPAP permits an appraiser to value a property that they did not make an interior and exterior inspection.

However, USPAP does not allow an appraiser to communicate a misleading report. A report that falsely indicates that an individual made an inspection of a property when in fact they did not is misleading, and could result in disciplinary action, civil liability, or other negative consequences.

To read more, Click Here

My comments: Good reminder, especially with the use by the GSEs of alternative valuation methods. Of course, you know nothing about the qualifications of the person doing the inspection. The article did not specifically address UAD 3.6, but I assume it would have the same certification section and requirements.

Read more!! →

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