so says Sara Stephens (say that 5x) president of the Appraisal Institute, the industry's largest association. And that’s the way it oughta be.
But in my experience over the last year or so, more than a few of the deals I’ve been involved with have failed to “reflect the market”. And I hear the same thing from many other agents.
And not helping matters, the methods used by appraisers to arrive at their valuations are inherently backward looking. They’re looking at sales that closed in the last 3 to 6 months. When the market itself – buyers & sellers - is much more attuned to what is happening now, today and tomorrow. Not what happened 3 to 7 or 8 months ago. Yes, 7 or 8 months, because if they’re looking at sales from 5 or 6 months ago they’re looking at buy/sell decisions that were made as long as 6, 7 and 8 months ago. Ancient history.
Meanwhile the market for everything from stocks, to commodities and gold to the price of an item on eBay are all trading based on current market conditions. Supply & demand.
While homes continue to be valued based on stale data.
And though they’ve yet to crack the code, even Zillow is constantly tweaking their valuations. And while I don’t know what data is included in their valuation formula, I’m guessing it’s more sophisticated than just looking back at old sales figures.
Read all about it >
From The Seattle Times > Appraisers have yet to get with the appreciation program
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