FHA Appraisal Inspection and Honesty in a R.E. Transaction

Honesty in a Real Estate Transaction            

I recently did a FHA Appraisal in Long Beach. I found a few things wrong. When I looked under the house, I saw jacks support the floor. This would defiantly affect the livability and Structural Soundness of the house.

The most interesting part was that the seller was hoping I would not see this. Also the MLS listing made no mention of the home needing repairs. 

This makes question the honesty of the seller and the agent. What about disclosure? Had this sold and the agent never mentions this, then the new owner found out, the agent could be sued. The most important part was if the Agent and Seller had hired me to a do a PRE-FHA Appraisal Inspection, I would have told them everything that needed to be addressed before the appraiser comes out. This would have saved a transaction. The seller would be happy and the agent would be happy.

If you would like to know more about a Pre-FHA Appraisal Inspection, please call me at 562-673-1138

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October 10, 2012   No Comments

What have 1 Bedroom Homes done in Long Beach since 2000?

I recently did an appraisal of a 1 bedroom in Long Beach. During the course of my research, I wanted to see what 1 bedrooms have been doing since 1/1/2000.  I created this chart for all of  Long Beach. The higher values on the chart are from the Eastside and the Peninsula. What is most interesting to see,  is that during the peak around 2006, there are no sales under $200,000.  Think about that, these are typically first time buyer homes that are between 550 s.f. to 875 s.f. on small lots. To me, when I did a few appraisals of these back then, I would often think that this is just wrong, someone is willing to pay over $200k for a 1 bedroom, really?  But the comps actually supported those values.

Here is a link toa pdf of the chart.

1 Bedroom since 2000

If you have any Appraisal needs in Long Beach or the surrounding area, please call 562-673-1138.

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July 18, 2011   No Comments

Appraisal Pictures

 

They say a picture is worth a 1000 words. This is true for appraisals also. I had a conversation with a client the other day. She was telling me about an appraisal she received and how bad the pictures were in the report.

My first thought to myself was, “the appraiser inspected the property, he saw everything, does it matter how good the pictures are?” After a second, I said “yes”. An appraisal is a report, and someone, in some other location who has never been to that house and does not know the neighborhood, is going to rely on your report. They are going to look at the pictures in your report, so why not take the best pictures you can? I am not talking about learning to be a professional Architectural Photographer, just know how to take a good picture that accurately represents the home, room or condition.

 Here are a few tips:

  1.  Know the direction of light. Try not to shoot into the light.
  2. Use a wide angle or fisheye lens. How hard is it to get those interior photos, a wide angle lens can capture an entire room.
  3. Depth, try and get as much of the yard, house and pool as possible. Step back, but be careful of those “yard bombs”.
  4. Try and center what you are taking a picture of.

 Let me know what you think?

 If you have any appraisal needs or referrals, please call me at 562-673-1138

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March 30, 2011   No Comments

External Factors that can have a positive impact on a neighborhood?

 

I was up in the Mid-City area of Los Angeles today doing an appraisal.  The subject house was located close off a major east west street. I pulled a few comps from different neighborhoods. I knew the range was different but I wanted to see the other areas that had higher values. Once I got to the other neighborhood, it was quiclky obvoius that the homes here are of higher value. The homes had curb appeal, all nicely landscaped and maintained. But what really let me know when I was in a higher priced area was the street. All the streets were recently repaved and or slurry sealed. This had me stop and think about how something out of the homeowners control can possibly influence the perception of buyers and how this might contribute to higher values in the long run.

What do you think?

If you  need have and real estate appraisal needs in the greater Los Angeles and Long Beach Area, contact me at 562-673-1138, www.wallaceres.com

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March 10, 2011   No Comments

Comparable Selection

When you provide appraisers comparables, make sure that is what they are. If the subject house is 3 bedroom 2 bath, 1,600 sf in Lakewood Please don’t hand the appraiser a home that is 4+ bedrooms over 1,900 sf and over a mile away in Long Beach, and over 6 months old.

Current underwriting has changed for loans. Lenders want to see a minimum of 3 sold comps within the last 90 days. As well as 2 Active or Pending sales.

I typically try to stay as close to the subject as possible for starters. If the house is 3/1, I will focus one finding other 3/1’s first, then expand t 2/1’s and 4/2’s. I want to bracket the square footage. If the subject is 1,600 sf, I want comps that are less and more then 1,600 sf. Remember, we are trying to find the best match to the subject if possible.

Also, tell the appraiser was comps you used in determining the list price. The more information you can provide to the appraiser the better.

Sometimes, the best thing you can do when you think it might not appraise for the price your sellers wants to list is for, call me. I can help, by providing an objective opinion from a third party. I can do this for a small fee.

If you have any Apprasial Needs in Long Beach/Lakewood or surrounding areas, call me at 562-673-1138 or go to my website www.wallaceRES.com

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January 31, 2011   No Comments

Total # of Appraisers in Long Beach

I was curious as to the total number of appraiser there are in the city of Long Beach

 I went to the OREA website looked them up. Then, I decided to see how many are independent fee appraisers and how many are not. Any appraiser listed as working for a bank or a government agency I assume are not independent fee appraisers.

So, we have a Total of 149 Appraisers in Long Beach, of which, 140 are Independent Fee Appraisers. Look at the number of Trainees, only 14. Do you think we are going to have a problem in the future as some Appraisers retire or leave the industry? That is a different topic all together.

 Next I was curious to see how many closed sales of Condos and SFR’s there were in Long Beach for the past 4 months. I also wanted to see how this would average out to work for those Appraisers. I did not include Certified General Appraisers since they focus mainly on Commercial work. I also did not include Trainees since they can not really do work on there own. That left only Certified Residential and Licensed Residential Appraisers, a total of 84.

 I then took the total number of closed sales and divided that by the number of Fee Appraisers, as you can see that was between 2.7-3.0 Appraisals per Appraiser in Long beach, not including January. I guessed at a conservative post HVCC/AMC fee for an appraisal of $300. Basically each Appraiser would be making $775 -$866 per month.

 

Wow!

This does not include the fact that appraisers from other areas come to Long Beach.

 Basically, there is not enough work for the Appraiser that remain to make a decent living on, couple that with the low fees being paid and the fact that we lost most of our clients when the HVCC went into effect, it is no wonder the ranks are thinning.

To me this looks like a good argument to band together and demand a higher fee.

 What do you think?

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January 21, 2011   No Comments

A Look at the most Recent Data for Long Beach

 

This is a look at the current Real Estate Market for Long Beach. If you would like some custom information or to get a copy of one of are reports, send me an Email or Call Wallace Real Estate Services – Appraisals at  562-673-1138

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January 20, 2011   No Comments

“Comp Checks & Value Checks” the legal way.

Comp Checks, Value Check, etc….

 There was a moment in the “Boom Time” that appraiser would often get calls from Mortgage Brokers for “Comp Checks” or Value Checks”.  Most of the time, this was a LO simply shopping for an appraiser that could “hit the number”.  The problem was that a Comp/Value check was an appraisal and we could be liable for it.

 Well a few years back I read an article about a guy that actually created a USPAP Compliant Value Check. What a great thing I thought. I got a hold of the guy, and he sent me all the information on how to do them legally.

 The other day I stopped in and talked to a Branch Manager at a Mortgage Office to offer my Pre-FHA Appraisal Inspection Service, and he asked me about Value Checks.

 Yes, WRES offers value checks.

 Why might you need one? In this current Real Estate Market, it is hard to know the value of something. A Value Check can provide a quick value to see if a refinance can work. Maybe you want to make an offer on a property, are concerned about the value.

 A USPAP Compliant Value check is a simply way to check a range of value. In no way will it replace what a Full Appraisal can provide.

 If you need a Value/Comp Check, please call Wallace Real Estate Services– Appraisals at 562-673-1138 or email us.

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January 19, 2011   No Comments

Pre-FHA Appraisal Inspections

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December 2, 2010   No Comments