I just recently rec'd a review of one of my reports, and the reviewer revalued the subject utilizing one comparable sale and two open listings. He/she actually adjusted the listings as if they were closed transactions. FNMA Sect. 406.02 states "The appraiser must report a minimum of three comparable sales as part of the sales comparison approach to value. The appraiser may submit more than three comparable sales to support his or her opinion of market value, as long as at least three are actual settled or closed sales." Am I wrong to consider this review as flawed? What are your opinions?

That's an interesting approach to reviewing that I would never take. Was the reviewer attempting to show a declining market? If so I think most reviewers would agree that we would use 3 sold comparables and then make a "Date of Time/Sale" adjustment" supported by statistics.

I would vote that this is a seriously flawed review and would love the rebuttal ooportunity!

Listings show substitute properties. Why would I pay $100,000 for your house, when the same house next door is listed at $90,000?????????

So...one that would not use an adjusted open listing as one of their three comps, and one that would. Anyone else?

Is that what Dan stated????????????????

I agree with Dan's statement. But if I include listings, they are in addition to closed sales.

Listings do not show substitute prices. They are un-negotiated ASKING prices. Listings will usually be higher than the sales price.

That's correct Mag, so that negotiation means that a likely sale price will be less than the listing price, making the listing price the upper limit to value. Yikes.

Listing are the "high-end" of prices. What sellers "HOPE" to get.

There are homes at lower prices that are available and people will pay more for the home they want while the lower listed home "roasts" on the market.

This sounds like a CRAZY review!

Rebutt, Rebutt, then Rebutt some more.

Could you end-up on a blacklist for this review?

A four page rebuttal has been penned and sent to the mortgage broker, with direct USPAP and Fannie Mae statutes being referrenced. Regarding a blacklist, who knows? It would be a first for me.

I agree that the listings show the competition and what the high end is typically, and I always look at them, but I would never use them as the first second or third supplememntal/replacement sales comparable when doing a review!

When current listings are less than the appraised value, the appraised value is too high, all else being equal. AT least that's the way I look at it.

I've noticed a lot of extra stuff attached to appraisals these days. Transmittal letters, flood maps, subject location maps, summary of salient features, plat map, resume. All those were on the last review I did. When did all this become necessary. Use to be all you needed was a TOC, URAR, Sub photos, comp photos, sub & comp map, sketch, & a License. Maybe and xtra comp or two.

Signed,

Cranky

Another interesting thing about this review was that the reviewer re-valued the subject utilizing the previously described comps; however, he/she did it in a four sentence paragraph, and did not put the sale/listings in a grid. Sloppy at best, IMHO.

Its all about competition Carrie. Honestly, if I happen to see another report and they use something that I don't, I try to employ that in my report. Its just competition. Kind of like, whatever happened to plain old compact discs. Now you have compact discs with DVDs and extra features. Its just competition.