Possibilities and probabilities are two totally different things”. In the past, prior to HVCC it was unusual for appraisers to get requested by loan officers, “What is the highest value you can appraise this property for commercial real estate appraiser. The HVCC reduced a large portion of this by putting in an extra layer of security (and consequently adding the chainsaw out of our regular charges). But, there were appraisers who would search for homes and select the top sales to back the purchase.
However , with the CU in place, if only three comparable sales that have the highest prices for sales are chosen in the appraisal, the CU will probably be able to bring it to an attention from the lending institution, which may at the same time call it into the appraiser’s attention. If you’re appraising the property with 10 comparable sales in the area and you choose to use the highest three sales appraisers must have support and be able to justify why the value is at the top part of the spectrum.
Most expensive price that is possible
This isn’t to say that under certain circumstances, it shouldn’t be on the higher end of the spectrum (superior condition, better in terms of quality, bigger area, superior view, higher GLA and so on). However Residential appraisers near me, if the property is at the middle in comparison to similar sales, it is based on several aspects that impact the value (GLA and condition, as well as the quality of construction as well as the bed and bath count and view of the location, basement space and finished basement space and lot size, etc.)
The ultimate value assessment should not be on the extreme low or high portion of the spectrum. Our job is to determine the most logical price that the property could sell for, not necessarily the most expensive price that is possible. This will also to keep fake appraisals out of mortgage and equity markets for home refinance.
Appraisers could explain to your clients
The way this will play out in the long run is yet to be determined. I’m sure appraisers are concerned about CU in terms of how it might impact our profession in both the near and long-term and I am too. The problem is that these concerns have been covered by appraisers from other disciplines.
I’m just going to suggest revisiting what is meant by market value. This “most probable and not highest possible” section in the definition something appraisers could explain to your clients, and even real estate agents if the value you estimate is less than the contract price.