All Forum Posts by: John C. Carlson

@Nick Michaels , Your last sentence in your last paragraph hit the nail on the head. I imagine the Agent that did the BPO knew nothing about Solar, but I can tell you that VERY few of my appraiser colleagues knows anything about valuing a solar system. First, I am assuming that you have an "owned" system; Lenders do not allowed to give any credit if the system is leased. The Appraisal Institute has tow 2-day classes on valuing Sustainable Amenities and Solar. I have taken and passed both courses and am listed on their Website as having taken/passed these courses.

The AI courses are only the beginning of getting the knowledge to value properties like yours. The other problem is finding the data that is used to provide an adjustment for having Energy Efficient features and solar. I would take a look at your MLS Board to see if they have fields that allow Agents to input data like this. If they don't, no appraiser in your area is going to be able to get the necessary data. Start asking your local board to allow the fields necessary to do this analysis.

John C. Carlson. <> CA Certified General Real Estate Appaiser <> Victorville, ?CA

Josh, I'm a commercial/residential appraiser in So CA. In March, I'll mark 40-years as an appraiser. Unfortunately, in this era, you, THE BORROWER has to know as much, if not more that any appraiser about your market area to protect yourself.

First, get a copy of this report - the law says you are entitled to one. Then, get in your car and drive the Comps the appraiser used to decide for yourself how "comparable" they are. Take photos of the Comps, I assume that these Comps are also large acreage properties.That way, you have documentary evidence about the Comparables. 

Since, again these may be large acreage properties, try to get on each property to have a 1st hand look at what amenities they have, or not have. Were the Comps all close to 100-acres? If not, what kind of a land adjustment did the appraiser use? Did he/she assemble land sale comparables to make a market-derived adjustment, or did the appraiser just throw a dart at a land adjustment on the Land Adjustment Dart Board?

Next, If you're not a Member of the local MLS Board, hopefully you have an Agent friend who is. Have this person print out the listings for all of the Comps the appraiser used to compare the listing data with what the appraiser noted in his/ her report. Are their any discrepancies in the data? What did the appraiser miss?

Also have the Agent (or you) print out all comps the appraiser SHOULD HAVE USED. Don't cherry-pick, print out the Comps that are most similar to your home. If any Comps have a low sales price, determine why - bad condition, smaller lot/house, etc.? Note that to the appraiser

With respect to the neighbors house, you definitely need the sale listing for this property. Be sure to get the photos in the listing also. Hopefully this Agent put many photos in this listing, especially the interior. This way, you can show how inferior the condition of this Comp is. Will the Listing Agent verify that this Comp was indeed a fire sale? If so, tell the appraiser to do his/her own verification about the fact this is a "fire-sale" The appraiser should have verified the Comp in the first place, but in any case, if the condition of the property and the fact it was a fire sale is correct, the appraiser SHOULD NOT have placed most weight on this property. 

Good luck with getting an appraised value you can deal with. 

John C. Carlson

Victorville, CA

I am a Commercial Real Estate appraiser & am currently appraising a 48,000 SF industrial complex (four 12,000 SF metal buildings) in Adelanto, CA in the High Desert of the Victor Valley.

My building and two others are In Escrow at HUGE price increases over what these buildings were selling for Pre-MJ Ordinance by the city. Buildings are In Escrow for $4,000,000

I have also obtained lots of data for the City of Desert Hot Springs which has a more developed market at this point.

I would like to interview any investor involved in the real estate end of the Medical MJ industry - listing, selling, buying, and/or leasing buildings which will be used for cultivation.

John C. Carlson - Victorville, CA

Have to see my listing to get my contract info. Have tried to put it in in previous posts & was told that wasn't allowed. 

I'm late getting into this Thread. I am a Commercial Real Estate appraiser & am currently appraising a 48,000 SF industrial complex (four 12,000 SF metal buildings) in Adelanto, CA in the High Desert of the Victor Valley.

My building and two others are In Escrow at HUGE price increases over what these buildings were selling for Pre-MJ Ordinance by the city. Buildings are In Escrow for $4,000,000

I have also obtained lots of data for the City of Desert Hot Springs which has a more developed market at this point.

I would like to interview any investor involved in the real estate end of the Medical MJ industry - listing, selling, buying, and/or leasing buildings which will be used for cultivation.

John C. Carlson

Have to see my listing to get my contract info. Have tried to put it in in previous posts & was told that wasn't allowed. 

William,

You've been given some good advice from previous replys. I'm an appraiser very nearby you, in Diamond Bar, CA. From an appraisal reviewers standpoint, you need to get a copy of these reports and review them yourself. Enlist your Real Estate Agent to look up the comparables in the local MLS & make sure the appraiser is not using REOs that have been torn apart.

Then look for Comps that are in similar condition to the properties that you are attempting to buy. If you are dealing with an Appraisal Management Company (AMC) remember that the appraiser(s) who appraised these properties were most likely the ones who hit the "accept assignment" button the fastest, not the best or most competant appraisers.

Unfortunately, the HVCC has relegated the residential appraiser to the status of a form filler. When working for an AMC there is no incentive to do competant valuations, just get the appraisal back on time.

Good luck

John C. Carlson
CA Certified General Real Estate Appraiser
Diamond Bar, CA

I apologize for violating protocol - it will not happen again.

Still getting used to posting on this Forum

John C. Carlson

To all Investors & Rehabbers,

I've hogged space here as this is the third article I've posted in the last 1/2 hour. However, from what I've read, nobody understands the paradigm shift that has taken place in my profession and is going to directly affect your pocket book. Part of the reason I indicated to Joshua when I joined was to be able to address appraisal issues & help out BiggerPockets investors when they had problems. I am ramping up my investments now & will need help from you in the future.

As a case in point, this is a post on an Appraisers Forum that was JUST posted:

An AMC just sent me an order on as home. Must see today at 5 PM, they already set the appointment, and completion by 5 PM tomorrow a requirement.

Post by Barry Cleverton of Roseville, CA about a new AMC assignment:
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"An AMC just sent me an order on a home. Must see today at 5 PM, they already set the appointment, and completion by 5 PM tomorrow a requirement.

They need 3 comps, 2 in last 90 days, 1 within 6 months. No more than 15% gross adjustments. 2 listings for sale.

"Original and adjusted sales prices must bracket sbejcts value conclusion". No repair requirements allowed.

Fee $ 275. Sales and listing must be within 1 mile of subject,.

I am in Roseville CA. Property is in Lake Tahoe area (100+ miles away) and 4200 +- sq ft per lender.

WHAT DO THEY THINK? 3 HOUR DRIVE BACK AND FORTH.

Another from same AMC last week was to drive 180 + miles away to Redding. Geographical competency"

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My fellow BiggerPockets members - This is an actual post from 15 minutes ago from an AMC to Barry. Again, he is in Roseville, CA - they want him to to to Lake Tahoe - he says 180 miles one way.

Are all of you paying attention?????? This is a major issue. You really think all of you are going to get accurate appraisals dealing with AMC's??

Be concerned - BE VERY CONCERNED!

OK, I've posted enough. If anyone has any questions please e-mail me.

John C. Carlson
CA Certified General Appraiser
[WEB SITE REMOVED]

Tom,

RE: your wanting to report the appraiser who did not appraise your property properly. I don't know what State you are located in, but it has to have some type of Appraiser Licensing Board.

In CA, its the Office of Real Estate Appraisers (www.orea.ca.gov) Good luck filing a complaint. If your state is anything like CA, they are hugely backlogged. The OREA has a section where you can "Find An Appraiser" Locate this section & bring up the Appraisers Record. You can review whether he/she has been sanctioned. Also, you can see what the expertise is of the appraiser.

From now on, when meeting an appraiser:

1. Determine where the appraiser is coming from. If your in Kansas & the appraiser is coming from Africa, be VERY concerned!

2. Determine if the appraiser has any expertise in the neighborhood where your property is located. More important, find out if the appraiser has adequate access to data.

3. Of paramount importance is to come prepared to provide the appraiser with comparable data. Remember, they might be comming fro miles away & they only have 24 hours to complete their report. There only going to use the easiest comps.

Don't try to fool the appraiser - this will backfire on you. Give them the lowest and the highest priced comps & discuss why the low comps are low and the high comps are high.

John C. Carlson
CA Certified General Real Estate Appraiser
[WEB SITE REMOVED]

Tom,

Just as a FYI, I am currently the only "appraiser" member of BiggerPockets - you can bring up my info in the Members section.

Welcome to the wonderful world of the HVCC, foisted on my profession by Mr. Andrew Coumo, Atty General of N.Y. As my Member info will show, I'm a commercial appraiser in CA with 31-years experience. This new "way" has relegated residential appraisers to "form-filling" status. Get used to this, its not going to get better.

As you noted, you dealt with an appraiser hired by an Appraisal Management Company. (AMC) Basically, the AMC's are concerned about two things:

1. Which appraiser can do the appraisal the fastest AND
2. Which appraiser can do the appraisal the cheapest.

Experience and competancy don't even enter into the equasion for most AMC's. You should do the following: first, look at your appraisal report and see where the appraiser came from. If its a URAR 1004 form, there is a section at the end of the form where the appraiser indicates his/her physical address.

I am one of the Moderators on two Appraiser's Forums. Many of our members have been posting that AMC appraisers are being sent 60 to 100 miles to do an appraisal in an area in which they have no "Geographic Competancy". See where "your" appraiser came from & ask yourself if he/she could possibly have any Geographic Competancy in your neighborhood.

Next, Look at your RESPA Statement and see what your Lender charged you. Call the Appraiser and ask him/her what they were paid. Most AMC's pay appraisers from $125 to $225, but charge you, the Borrower $450 to $600. The difference between what the appraiser was paid and what your were charged is being pocketed by the AMC.

What you posted RE: the appraiser/AMC responding about what you paid 1-yr. ago vs. value today after upgrading, is, as you pointed out, PURE BS. However, I hate to be right, but I forecasted that rehabbers & flippers would have significant problems with this new system just for the reason you noted.

Here is a thought: did the appraiser actually respond to you, or is this just what the AMC came up with to feed to you? Either way, you have been scrrewed; but hey, this is a better system, right? (Sarchasm intended)

Finally, go drive the "Comps" the appraiser used. Ask yourself if the homes the appraiser used as comps are really "comparable".

There is no incentive for the residential appraiser hired by an AMC to do competant work. In fact there is a significant disincentive as most AMC's require delivery of a report within 24 hours of a property being inspected. If the appraiser does not meet the deadline, they don't get any more assignments.

Somehow, Mr. Coumo thought that AMC's would have less incentive than the "big-bad" mortgage brokers to control the appraisal process. In fact, they have more incentive. In addition, there is currently no regulation of these entities. You have no recourse to challange your value in most cases - extept to go to another lender and pay another appraisal fee.

All of you re-habbers & flippers take note of Tom's troubles - all of you will be facing the same issues. From what the members of our Forums are posting, the appraisers who accept AMC work are in general, newbies who need to work for McDonalds wages and put up with the BS requirements of the AMC. Your only alternative is to obtain a loan from a lender who does not fund thru FNMA or FHLMC. You will of course, pay higher fees!

Finally, you should send letters and e-mails to all of your representatives AND to Mr. Coumo letting them know how this new "improved system" has screwed you.

John C. Carlson
CA Certified General Real Estate Appraiser
[WEB SITE REMOVED]