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CMA ADJUSTMENTS

Licensed Real Estate Agent

Hanover, PA

July 28, 2011

I had a list of cma adjustments that someone so kindly provided me from this network. My computer decided to delete files and now I am without this wonderful list. If anyone has a list of cma adjustments they use and would be kind enough to share these with me I greatly would appreciate the information. Thank you in advance for everyones feedback.

Licensed Real Estate Agent

El Cajon, CA

July 29, 2011

Hi Peggy,

Below is a list of adjustments I've gathered from various appraisals clients have received. I know there can be a wide variance on some of these items...

Appraiser Common Adjustments:

Square Footage Adjustment: $40 -$50 / sq. ft. (condo $30)
Bedrooms: $3,500
Bathrooms: $3,000
Condo Parking Space: $2,000 per car
Fireplace: $1,500
Patio's and Balcony's: $2,000 per
Superior View: $10,000
Lot Size: $1.00 - $2.00 / sq. ft. (lower side more likely)
$10,000 when difference of 3+ acres
Home Condition: Average Compared to Good = $15,000 - $20,000
Average Compared to Inferior = +$10,000
Average Compared to Superior = -$15,000
Garage Space: $5,000 per added space
Central Air: $2,000 - $5,000
Fireplace: $2,000 - $3,000
Home Age: $1,000 per year
Kitchen: Upgraded: $10,000
Updated: $5,000
Patio: Slab to Covered: $2,000
Condo Parking Space: $2,000 per space
Condo Condition: Average Compared to Good: $5,000
Guest House: $10,000 $15,000
Unpaved Road: $15,000 up


Rick Tibbitts

Licensed Real Estate Broker

Naples, FL

July 30, 2011

Just a word of caution to Rick and others when publishing numbers like this for public viewing be sure to have a disclaimer that these numbers are approximate and based on a particular market/area/price range as I can tell you FL is MUCH different than PA as I have appraisal experience and brokers licenses in both states. Even in the same city different communities or subdivisions will carry different returns on upgrades. I would suggest you take a local appraiser to lunch or start gathering copies of the appraisals done on your sales to compare adjustments in your area. Even then it also varies from appraiser to appraiser. I have had 2 different appraisers come in on the same property with vastly different numbers. After looking at these adjustments I can tell you this is not true in my market. For example....the condition variance of $5,000 from average to good may apply in the $60,000 price point but could be $50,000 in the $500,000 range. A premium lot on the golf course versus off could be over $200,000 depending on the price range and community. Same thing with age of home, bedrooms, garage spaces....etc. There are so many variables when it comes to value in such a litigious time I wanted to help Rick cya....and it was very generous to share such a well put together list for your area.

Licensed Real Estate Broker

Rotonda, FL

July 30, 2011

Rick,

What area (State etc.) are these adjustment prices used? Thanks - this is super!

Becky Borci

941-626-7522

Port Charlotte, FL

Licensed Real Estate Agent

Hanover, PA

July 30, 2011

Hi Rick,

Thank you very much for the information. I am putting it with my listing information so that it doesn't go into cyber space again!

Peggy

Licensed Real Estate Agent

Hanover, PA

July 30, 2011

I think Rick's examples sound pretty close to the median price range of homes in our area. Sure there are exceptions and spectacular properties but this is a great guideline and by putting it together with some other info from various sources it should "even" out.

Licensed Real Estate Agent

El Cajon, CA

July 31, 2011

Hi All,

Thanks Susan for the word of caution about the wisdom of publishing cautiously information that could be taken as "the gospel" when so many variables can render this list meaningless or possibly even harmful if taken in the wrong context.

So - in that vein take the numbers I posted with a large grain of salt! These numbers are pulled directly from appraisals of homes in my area (San Diego, CA) but needless to say not only could two appraisers on one home provide widely different adjustments, add to that the geographical differences, home value differences, etc. and... well I hope we're on the same page. Use with discretion, at your own risk, etc.

All the best,

Rick

Licensed Real Estate Broker

Boca Raton, FL

July 31, 2011

Dear Rick and Susan:

Rick: Thanks very much for your post of common adjustments. Having managed real estate offices in NY and Florida, I was always amazed how many agents just ignored this subject completely because of the lack of education, availability or information in the marketplace. I know a lot of agents will find your post very helpful.

Susan: I agree with you completely in that the guide is a great place to start while keeping in mind the many local adjustments that really should be made. Great point made about getting together with an appraiser or even asking your manager to have an appraiser come to an office meeting to discuss and educate . Thanks to both of you!

Licensed Real Estate Agent

Sarasota, FL

July 31, 2011

Thanks, Rick, for sharing.

Peggy's question asks about adjustments for CMAs, not BPOs. In my experience, a CMA is more forgiving than a BPO.

In highly-distressed Florida (especially Sarasota area), we list agents must be pretty certain of value in order to "help" banks' valuation people report accurately.

From many appraisals - especially multiple appraisals on the same properties - I very much agree with Susan Heller who says,

I would suggest you take a local appraiser to lunch or start gathering copies of the appraisals done on your sales to compare adjustments in your area. Even then it also varies from appraiser to appraiser. I have had 2 different appraisers come in on the same property with vastly different numbers.

For every listing, I create my own bpo or when I face a property with few or no solid comps, I strongly encourage property owner to pay for appraisal.

With short sales, it's too easy to watch in horror as listed properties under contract slide into foreclosure after a bank "valuation" person (usually a poorly trained real estate agent) files his/her bpo for $50,000 above what YOU the list agent believe the property is worth.

Now you (list agent) are faced with 3 choices: 1. dispute the bank's opinion of value; 2. try to get a buyer to increase an offer beyond the property's value; or 3. allow the property to go to foreclosure.

Property values truly are "opinions" of value even when completed by highly trained property appraisers. As listing agents, we MUST talk with the appraiser & offer FACTS not readily apparent to a bpo agent or appraiser.

I wish valuing properties were more of a science instead of an art. If a science, then we'd all benefit from Rick's list.

Mike

Sarasota Foreclosures - Sarasota Real Estate

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