Episode 080 - Is Your Comparable, Comparable?
Episode 080 - Is Your Comparable, Comparable?
Agents and appraisers disagree about many things but almost none more vehemently than what comparables to use. Don’t fret though, other appraisers, lenders, and homeowners constantly argue with appraisers too. The tough part, there are no rules or definition on what is a comparable property.
In this episode, Brian talks about things to consider when searching for comparables and how to better help yourself in writing a CMA, discussing properties with an appraiser, and just maintaining your sanity on this topic.
SHOW NOTES
- 01:30 – Appraisers do not hate agents.
- 03:05 – Already up to 80 episodes.
- 03:20 – One of the top reasons for agents and appraisers to argue is over comparables.
- 03:55 – Many professionals don’t agree what is a comparable is.
- 05:00 – There are some descriptions of a comparable: Fannie Mae and Freddie Mac, USPAP, and other text.
- 07:20 – Difficult to “define” a comparable so it becomes subjective.
- 08:10 – Things to consider when searching for comparables: bracketing.
- 10:00 – Lender will chime in on comparables. Appraiser has to appease the underwriter.
- 11:05 – Comparables should be similar physically, economically, locationally, and legally.
- 11:40 – Many people “know” what a comparable is, like it is a fact. Not possible.
- 13:10 – Agents have some awareness of comparables because they might know what a typical buyer would do.
- 15:10 – A comparable is not necessarily one that just supports the contract price, but not similar in amenities.
- 16:35 – Fannie and Freddie look at adjustments to the comparables. The more adjustments, the property might be less of a comparable. Proximity and sale date are also factors.
- 18:55 – A comparables is not a fact, so don’t get mad because the appraiser doesn’t use your comparables.
- 20:00 – Everyone says they have the “best” comparables but did they back it up? Explain why your comparables are the “best.”
- 20:50 – Explain why a property might NOT be a good comparable.
SHOW LINKS
- Comparable described by Fannie Mae – https://selling-guide.fanniemae.com/Selling-Guide/Origination-thru-Closing/Subpart-B4-Underwriting-Property/Chapter-B4-1-Appraisal-Requirements/Section-B4-1-3-Appraisal-Report-Assessment/1032992441/B4-1-3-08-Comparable-Sales-10-02-2018.htm#:~:text=Comparable%20sales%20should%20have%20similar,compared%20to%20the%20subject%20property.&text=Fannie%20Mae%20does%20allow%20for,appropriate%20for%20the%20appraiser's%20analysis.
- Appraisal Scoring Model – https://singlefamily.fanniemae.com/media/20576/display#:~:text=CU%20provides%20a%20numerical%20risk,that%20may%20require%20further%20attention.
BETWEEN THE LINES LINKS
Web
https://www.facebook.com/groups/realestatebetweenthelines/
https://www.facebook.com/Brian-C-Lee-111822417027919/?
YouTube
https://www.youtube.com/channel/UCcv4dHU39-b5_QVVCIhbcBA?