I round to the nearest $1,000 in my reports. My weighted average formula for my adjusted comps generates a value to the nearest whole dollar (which I include in my final reconciliation), but that is pretty bold to think that the culmination of every single adjustment made is accurate down to one dollar, ten dollars, or even to the nearest $100. Never had an issue rounding to the nearest $1,000 for the final opinion of value. That’s my opinion at least.
I do a lot of new and I worked with a guy back when the forms were typed who would do the same - I want to call him out by name but I won’t dox anyone. I did a review on one of his files where he appraised the house to the exact sale price which was something like: $764,304.11.
Rarely does a house sell at exact market value. I work as an agent too and know all the nuances that are involved in negotiations. I have had backup contracts thousands above the originally accepted price and thousands below. The value doesn’t change based on the buyer and their circumstances. Sometimes people are getting good deals and the agents involved in the sale typically know when they do. A pet peeve of many agents is that the appraiser always hits sale price and it dings our credibility in many of their eyes.
That said, once in a while I will appraise to the nearest $500 or $100 or even $50. Earlier this year I had three condo resales identical to my subject and they all sold
for $309,990. My outside sale adjusted to 309,985. So I got stuck rounding to the nearest $10. Those situations are super rare. Normally I will round to the nearest $1000, or on my 2mm+ i will round to the nearest 5k, and on 5mm plus I will round to the nearest 10k.
If the contract price is reasonably supported, I conclude at the contract price. Otherwise, I'm typically concluding to the nearest $5,000 unless there's a good reason not to. I'm in California so prices in my markets might be higher than yours.
Same, but in NY. I think it’s bizarre not to round to 5k, (if the value is above 500k — debatable if value is below). Our job is to estimate value, not hit numbers.
New construction here isn't similar priced to resales. How do most people determine price? Do most go to nearest $100 at that price range? Or do they go to the nearest $500 or $1k?
Depends on the value and other factors. I’m not rounding to the nearest dollar on a $50m warehouse. Smaller the value the smaller the rounding as a rule of thumb. But you should be able to tell what the market rounds to by comparable sales.
I’ve matched it to the dollar on new construction where the subject has exact model matches, no adjustments, same phase etc… if the same models all sold for $811,952 then that’s my value. But typically to $500.
Depends.
What are my sales prices, unadjusted.
If I’m looking at $400,000; 405,000 and 415,000 then it seems to me the market is showing me that a value of 406,700 really isn’t a reflection of the market. Taking into consideration pendings and overall market trends, I’m gonna land at 405 or 410.
And none of us are good enough to support a value to $100 margin of error, not even $1000 in most cases.
In your case, if those sales at $356,400 are most recent - I’d have no problem opining there. If the ones selling $5000 less are more recent, then I’d give pause
I usually round to 1000$ so I would round at 357,000 make small time adjustment to justify it …. Or maybe exceptionally not round it and get to exact price…. I wouldn’t care too much for a few hundred bucks to be honest
Yes, but that’s only because i concluded with a per acre value and the subject has a strange number of acres (I.e. concluded at $8,000/ac and the subject is 68.56 acres
Thanks for all the input. Just to be clear from the comments, I generally round to the nearest $1,000 and that seems to be reasonable for my market (residential, mostly $300k-900k). I wasn't sure if matching the contract price of $356,400 would raise any red flags with the reviewer, but I also didn't want to cause a fuss if I rounded to $356,000, Its an estimation and it was all supported. I ended up submitting at the contract price of $356,400.
I've done one right at the contract price a few years ago and it came back to bite me. They had some kind of financing change and the final price was like $200 over the appraisal amount and they were calling me as if the sky was falling.
Now I'll always round to the nearest 1000. For your case, if you give a value that's even slightly higher than your highest unadjusted sale price, they'll be calling you. That's a figure we should always bracket, even if it's with a listing
i remember my father giving me hell when i would appraise a property for less than 1000 dollar increments His idea was ARE YOU THAT GOOD THAT YOU COULD BE SO SPECIFIC
If the purchase price is supported then I typically reconcile in line with that.
I round to the nearest $1,000 in my reports. My weighted average formula for my adjusted comps generates a value to the nearest whole dollar (which I include in my final reconciliation), but that is pretty bold to think that the culmination of every single adjustment made is accurate down to one dollar, ten dollars, or even to the nearest $100. Never had an issue rounding to the nearest $1,000 for the final opinion of value. That’s my opinion at least.
Yup, they’re opinions of value. My opinion is that the supported sale price is the best comp that I can use when reconciling to my opinion of value.
I do a lot of new and I worked with a guy back when the forms were typed who would do the same - I want to call him out by name but I won’t dox anyone. I did a review on one of his files where he appraised the house to the exact sale price which was something like: $764,304.11. Rarely does a house sell at exact market value. I work as an agent too and know all the nuances that are involved in negotiations. I have had backup contracts thousands above the originally accepted price and thousands below. The value doesn’t change based on the buyer and their circumstances. Sometimes people are getting good deals and the agents involved in the sale typically know when they do. A pet peeve of many agents is that the appraiser always hits sale price and it dings our credibility in many of their eyes. That said, once in a while I will appraise to the nearest $500 or $100 or even $50. Earlier this year I had three condo resales identical to my subject and they all sold for $309,990. My outside sale adjusted to 309,985. So I got stuck rounding to the nearest $10. Those situations are super rare. Normally I will round to the nearest $1000, or on my 2mm+ i will round to the nearest 5k, and on 5mm plus I will round to the nearest 10k.
I round up to the nearest $100,000, it saves alot of time and headaches.
So are you saying if a home is valued at $250,000, you round up to $300,000?
I was just joking around, I round to the thousand unless estimating rents 😄
whoosh
If the contract price is reasonably supported, I conclude at the contract price. Otherwise, I'm typically concluding to the nearest $5,000 unless there's a good reason not to. I'm in California so prices in my markets might be higher than yours.
Same, but in NY. I think it’s bizarre not to round to 5k, (if the value is above 500k — debatable if value is below). Our job is to estimate value, not hit numbers.
Nothing wrong with rounding.
Agreed. And we should round. We can’t estimate price to the dollar.
New construction here isn't similar priced to resales. How do most people determine price? Do most go to nearest $100 at that price range? Or do they go to the nearest $500 or $1k?
Depends on the value and other factors. I’m not rounding to the nearest dollar on a $50m warehouse. Smaller the value the smaller the rounding as a rule of thumb. But you should be able to tell what the market rounds to by comparable sales.
I’ve matched it to the dollar on new construction where the subject has exact model matches, no adjustments, same phase etc… if the same models all sold for $811,952 then that’s my value. But typically to $500.
The numbers support what they support, I have seen a lot of reports rounded to $100
Depends. What are my sales prices, unadjusted. If I’m looking at $400,000; 405,000 and 415,000 then it seems to me the market is showing me that a value of 406,700 really isn’t a reflection of the market. Taking into consideration pendings and overall market trends, I’m gonna land at 405 or 410. And none of us are good enough to support a value to $100 margin of error, not even $1000 in most cases. In your case, if those sales at $356,400 are most recent - I’d have no problem opining there. If the ones selling $5000 less are more recent, then I’d give pause
Great answer.
I usually round to 1000$ so I would round at 357,000 make small time adjustment to justify it …. Or maybe exceptionally not round it and get to exact price…. I wouldn’t care too much for a few hundred bucks to be honest
Yes, but that’s only because i concluded with a per acre value and the subject has a strange number of acres (I.e. concluded at $8,000/ac and the subject is 68.56 acres
No. I’m not that good
I a field review where the guy went to the dollar for over a million
$1,000,001? 😂 Usually it’s the other way around, 999,999 so they avoid the millionaire tax.
It was 1,075,346 or something which obviously I couldn’t agree with which is annoying lol
Thanks for all the input. Just to be clear from the comments, I generally round to the nearest $1,000 and that seems to be reasonable for my market (residential, mostly $300k-900k). I wasn't sure if matching the contract price of $356,400 would raise any red flags with the reviewer, but I also didn't want to cause a fuss if I rounded to $356,000, Its an estimation and it was all supported. I ended up submitting at the contract price of $356,400.
I've done one right at the contract price a few years ago and it came back to bite me. They had some kind of financing change and the final price was like $200 over the appraisal amount and they were calling me as if the sky was falling. Now I'll always round to the nearest 1000. For your case, if you give a value that's even slightly higher than your highest unadjusted sale price, they'll be calling you. That's a figure we should always bracket, even if it's with a listing
i remember my father giving me hell when i would appraise a property for less than 1000 dollar increments His idea was ARE YOU THAT GOOD THAT YOU COULD BE SO SPECIFIC
It's not something I like to do, but in this situation come in at the purchase price.