A frequently asked question:  Do you do comp searches?

Also known as "Pre-Comps," "Value Checks," and "Pre-Appraisals."

Yes & No, read further please.

It is impossible, and against USPAP standards, to provide an opinion of value without completion of the appraisal process.  Value indicators such as condition, square footage, location, upgrades, repairs needed, view amenities, and any functional or external obsolescence cannot be accurately determined without an inspection. 

What we can do:

We can share available sales & listings near the subject property that may have similar value attributes per tax data. These might be the comparables that we will use in developing an opinion of value or completing an appraisal report.  None of this data shall be considered any kind of value opinion.  The appraised value could be higher, lower, or similar to any sales or listings that we share with you.  We can discuss the probability of various market values in a limited way, but ultimately, we can't give a value opinion without full completion of the appraisal.  Any value figures on order forms, such as "owners' estimates of value," will pretty much be ignored.

If you would find this helpful, just note this on the order form.  We will do it prior to the inspection.  We will email you a description of some of the nearby sales & listings that we will be researching further in the appraisal process.  These may or may not be the comparables that we use in our appraisal.  Note that the sales & listing data provided has not been verified and could change once a full inspection/appraisal has been completed.  

We will make sure that we consider all upgrades and that the property is not under appraised.

What we cannot do:

We cannot "shoot for" a certain value or "try to get max value."   These are illegal assignments.

We will not respond to illegal requests such as "If you can get $xxx,xxx, you can have the appraisal order."

If you are "value shopping" by sending multiple comp check requests to multiple appraisers,  we are not your appraisal company.

We will not accept an assignment in which the fee is dependent on any appraisal outcome.

We are happy to some provide market data to help you evaluate the probability of possible values. We cannot give a specific opinion or promise a certain value or take an assignment based on  obtaining a certain value.

Special note regarding the recent market in Northern California.

In general prices increased rapidly (10-20% per year) from the year 2000 (& prior) to a peak in mid to late 2005.   Home prices are much lower now.  See this data from DataQuick.  Also, current listings of properties in some areas are lower than even recent sales.  Many REO & short sale properties are on the market and demand has fallen, partially due to tightening lending standards and fear in the Sacramento area market. 

If you are trying to structure a loan, keep this in mind:  Most homes that were refinanced or purchased from 2003-2007 have a high probability that the existing loan balance exceeds the current value.  Of course this does not apply to every home in every market. Some local markets have been remarkable stable. This has just been a pattern that we have seen, especially in newer areas and areas that had a lot of subprime lending.

We are not trying to be negative and we will be sure not to under appraise any property.  We just thought it would be helpful to share the recent change in the market.