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Old 10-13-2010, 04:42 PM   #16
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Just Venting: Appraisal process works against "doing it right"


Thanks for the thoughtful reply Micheal. "How to Pick your Problems" That's brilliant! (Maybe you can develope a similar thing for dating websites). I would reply that:

Buyer knowledge (or lack of knowledge) regarding the value of property condition does not justify the failure to include property condition in the formula used by the professionals who determine value.

Windows, market changes do not explain the weird mismatch in appraissals done a few days apart, between very similar homes a block away, where one is nice and one is crap, but there is less than $5000 difference. Nice family neighborhood, good community. Again.... its not a comparision of a 2003 appraissal to a 2008 one. They were both in June 2008. Whether the crap house was overvalued or the good house was undervalued, I don't know. But I will believe to the day I die that an honest process that seriously considers condition would have come up with a much larger spread, whether the market is up or down at the time.

Last edited by steveel; 10-13-2010 at 04:44 PM.
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Old 10-14-2010, 11:27 AM   #17
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Just Venting: Appraisal process works against "doing it right"


The current process, though broken, has a way of sorting itself out. Using your two examples, the house that is in poor condition will not fetch the asking price of the one in good condition. When the actual sale price is agreed upon, appraised values on future appraisals in the area will be adjusted accordingly when the appraiser looks into comps. This does not help the current sellers though.
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Old 10-14-2010, 12:05 PM   #18
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Just Venting: Appraisal process works against "doing it right"


Question for buyers or sellers who complained about mortgage appraissal:

"What value adjustments happened when you complained that appraiser ignored really wonderful or really awful factors of (a) required maintenence or (b) discretionary improvements?"


I hypothesize that results will show most adjustments are little more than token amounts (to mollify the masses). Exceptions will be for changes to number of bedrooms, bathrooms, and square feet. Almost everything else..... does not factor into the mass-production formula in any meaningful way.

===========

For any lending institution using any form of government assistance or insurance, I'd like to see rules developed that would require the appraissal process place greater emphasis on condition and improvements.

Last edited by steveel; 10-14-2010 at 12:37 PM.
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Old 12-01-2010, 03:58 PM   #19
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Just Venting: Appraisal process works against "doing it right"


Quote:
Originally Posted by Pistol Pete View Post
They probably figure that most defaulting buyers are going to trash the house anyway..
DING DING DING!
When we bought our house we were worried that because of all the work needed and because the owner had lived there for 30 years with NO maintenance that it would not be appraised high enough when the appraiser actually got inside and saw the property (which was TRASHED!). The appraiser (trusted friend) told us that when he does the appraisal for the banks he is not really interested in the general condition/appliances or maintenance upkeep because the banks assume that if we default on our mortgage we would trash the place. The bank is really only interested in how much the structure of the house is worth and location of the property. Basically what they want to know is if we trash it how much they would be able to sell it for and they offer to loan us that amount and no more.
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