Complete Appraisal Blog

A Reconsideration of Value (ROV) is a procedure in which the appraiser is requested to re-evaluate the value opinion given in an appraisal. Fannie Mae and HUD have recently made this process standard.

Lender Responsibilities:

Verify that the borrower's request includes sufficient supporting evidence before sending the ROV to the appraiser.

The lender must dispatch a standardized message to the appraiser containing:

- Borrower(s) name, property address, effective date of the appraisal, appraiser's name, and the ROV date
- Identification and description of unsupported, inaccurate, or deficient areas in the appraisal report
- Additional data, information, or comparable properties, not exceeding five
- A definition of turn-time expectations for the communication of ROV results
- Instructions for submitting the ROV response within a revised appraisal report, including commentary on conclusions, regardless of the outcome
- Guidance for appraisers on addressing minor appraisal issues or nonmaterial errors not associated with the ROV process
- The lender is also required to report any unresolved significant discrepancies or signs of unacceptable appraisal practices to the relevant appraisal licensing agency or regulatory board and to report suspected clear violations of anti-discrimination laws to the appropriate authorities.

Borrower Responsibilities:

The borrower must supply supporting details that pinpoint and elucidate what they believe to be unsupported, inaccurate, or deficient items, along with additional data, information, and no more than five comparable sales (and the sources of the related data), demonstrating how the new data substantiates the ROV.

For any appraisal, only a single borrower-initiated ROV is permitted. It must be presented by the borrower to the lender prior to loan closing. After a loan has closed, the borrower may no longer request an ROV for that appraisal.
Appraiser responsibilities

After receiving the request from the lender, the appraiser must analyze the relevance of the information provided with the ROV. Regardless of whether the ROV request results in a change in value or not, a revised appraisal must be provided within the defined time frame with a description of the points in dispute and the outcome.

  

Low inventory of all types of housing continues throughout our market. Currently there is two months of inventory on the MLS.  Normal inventory would be four to six months. The median days on the market is 13 days. In April 2021 it was 35 days. The median list price for all MLS sales is up 8.8% over the past twelve months.

Locally Farmington has 1.4 months of inventory. There are 4 active condominium listings and 12 single family listings from $224,900 to $1,499,900.


 

A residential real estate appraisal is a detailed evaluation of a property's value, usually conducted by a certified appraiser. This is typically done to determine the market value of a home for mortgage purposes.

On the other hand, a residential property inspection is a thorough examination of the physical condition of a property, including its structure, systems, and overall safety. It is usually performed by a certified home inspector before a home is sold. 

While an appraisal focuses on the monetary value of a property, an inspection focuses on identifying any potential issues or concerns with the property. Appraisals are required by lenders for mortgage approvals, while inspections are recommended for buyers to make informed decisions about the condition of the home. 

In summary, an appraisal determines the market value of a property, while an inspection evaluates its physical condition. Both are important steps in the home buying process and should be conducted by professionals. We 

We often receive questions as to what is considered a bedroom.  A bedroom has to be a minimum of 70 sq. ft. with the smallest single measurement of 7 feet. A bedroom requires two forms of egress, a window and a door. A closet is not a requirment for a room to be considered a bedroom. If a room does not have a closet but is considered a bedroom, there maybe functional obsolesce present. Rooms in basements maybe legal bedrooms provided there is an egress window as required by the local building code.

Real estate appraisal is a critical part of the homebuying process. It involves evaluating a property and its features in order to determine an estimated market value. One of the key components of a real estate appraisal is the use of comparable sales, also known as comps.

Comparable sales are special markers used to evaluate the current market value of a home. They are used to gauge its worth based on recent sales of similar homes in the area. Comparable sales can include homes that have sold in the past year, with similar features to the one in question. These features may include but are not limited to: square footage, number of bedrooms, home age, construction materials, neighborhood, and nearby amenities.

By comparing the sale prices of these similar homes, an appraiser can get a better idea of what the current home may be worth. Generally speaking, the more comparable sales there are in the area, the more accurate the estimated value will be.

It’s important to note that no two homes are the same and appraisers often adjust the estimated value based on any unique features or upgrades made to the home in question. As such, appraisals are best left to licensed professionals who understand the nuances of this field.

If you’re considering buying or selling a home, thoroughly researching comparable sales in your area is key to getting an accurate appraised value. Doing so will help you make informed decisions when it comes to your property investments.

Functional obsolescence is a term used in real estate appraisal to describe a situation where a property's amenities or design detract from its overall value in the market. In other words, functional obsolescence occurs when the property's features are outdated or no longer considered useful to a potential buyer.

For example, a small bathroom in a house may not be attractive to potential buyers, as they may prefer larger bathrooms that are seen as more modern and desirable. Another example of functional obsolescence may be a house with 1960's wallpaper and paneling, as these styles may not be considered "in-style" anymore.

Functional obsolescence is important to consider when appraising real estate, as it can significantly reduce the value of the property. Appraisers typically calculate the loss in property value due to functional obsolescence through a process called the 'depreciation rate'. This rate accounts for the expected life of all features in the property and how much value those features have lost over time. The sum of all the depreciation rates will give an overall estimate of how much functional obsolescence has affected the value of the property.

It’s important for property owners to keep up with trends in order to maintain the value of their property. Doing small updates, such as replacing old countertops or flooring, can make the property more attractive to potential buyers and can help increase the value of the property.

Keep in mind that functional obsolescence is just one factor that appraisers consider when estimating a property's worth. Other factors include location of the property and size of the lot, as well as condition of the property. Overall, appraisers strive to provide an accurate market value estimate of a property based on all factors, including functional obsolescence.

A real estate appraisal is a professional opinion of a property's market value, and one of the key components to this process is finding comparable sales in the area. Comparable sales, or ‘comps’, are used to compare the features of the appraised property to recent sales of comparable properties nearby in order to determine its value.

The primary task for any appraiser is to find comps that closely mirror the characteristics of the property that is being appraised. This typically includes any similarities in size, condition, design and location.

When finding comps, it is important to find sales that have been completed relatively recently and in the same market area. If the comps are too old or are from a different market, they may not accurately reflect today’s market values and could lead to an incorrect appraisal.

When selecting comps, it is also important to consider certain features of the property that may have an effect on its market value such as views, condition, design elements, etc. It is vital to note any differences between the comps and the appraised property so that these can be taken into consideration when coming up with an estimate.

Finally, it is important to select at least three comps in order to ensure that you have a full and representative understanding of the market.

Choosing comparable sales is an essential part of the appraisal process and is something that any real estate appraiser must take seriously in order to produce ? credible results.

The professional appraisal process consists of estimating the market value of property based on its condition, age, location, design, and amenities. A bedroom is a crucial factor that affects property valuations and may even be a deciding factor in determining whether a piece of property is worth buying.

In order to be recognized as a bedroom, a room must conform to certain criteria. Generally, the room should have a finished floor and ceiling, at least one window and closet, and a minimum room size of 70 square feet.

In some cases, attics, basement rooms, finished garages and converted living spaces, may also be classified as bedrooms. In these cases, the room must be finished with permanent ceiling and floor, have a window for egress, be adequately heated and cooled and measure at least 70 square feet.

In conclusion, when appraising property it is important to take into account whether the current layout meets the requirements for the number of bedrooms. In order to maximize a property's value, it may be necessary to make improvements to any existing bedrooms in order to meet the minimum market preferences.

The following Connecticut towns / cities had revaluation in 2022: Ansonia, Berlin, Bristol, Cromwell, East Haddam, East Windsor, Farmington, Glastonbury, Goshen, Granby, Guilford, Middletown, Morris, New Britian, Plainfield, Preston, Simsbury, Southbury, South Windsor, Sterling, Waterbury and Winchester. If you own a single-family house, condominium or 2–4-unit house in one of these towns, check your mail for a notice from the town / city informing you of your homes new value for taxation purposes. Values have gone up significantly over the past few years.  You may be shocked at the percentage increase proposed by your town or city. If you feel the municipality has overvalued your property, give us a call (860)678-8704 to get information on the tax appeal process. It is important that you act quickly as there are strict dates imposed by the towns / cites in the appeal process. 

Low inventory of all types of housing continues throughout our market. Currently there is 2.2 months of inventory on the MLS.  Normal inventory would be four to six months. The median days on the market is 18 days. In February 2021 it was 45 days. 

Locally Farmington has 1.5 months of inventory. In February 2019 there were 5.5 months of inventory. There are 6 active condominium listings and 24 single family listings from $305,000 to $3,350,000. 

The national news paints a grim picture for real estate but until sellers outnumber buyers creating an oversupply, values should hold steady.