Where To Get Comps?
I am about to submit my first short sale package, and have a question about comps:
Do comps have to be recent sales, or could they be active listings that have not sold? I have access to the full MLS for active listings and have found a number of great comps that are unsold, but I do not have a way to get recent sales in the area without getting a realtor involved.
Thoughts? What is the standard process here? Also, is a printout from the MLS or a realty listing site sufficient, or do they need to be something more official (not sure what that would be...)
Thanks to anyone who can give me some help here.
Properties sold within the last 6 months will weigh the most on your negotiation. Also, expired listings will help if they are higher than your offer. If the lender thinks your offer is too low then you can prove that your offer is valid by showing them theproperties that did not sell. Active listings will give you an idea what the current market is but be sure to compare them to the properties sold because some active listings may stay on the market too long if the price is not right.
Listing prices are not comps. They may give you an idea of what the market exspectations are but not the actual market. There is a difference.
Good sources for comps in Georgia are:
The Beasley Report
The Crumpton Report
recent sells {6 mos. even up to a year} not listings......kenmax
Current listings that have been exposed to the market for some time, and expired listings are very important. They will tell you what a property is NOT worth. Including them will benefit the reader of your analysis.
Thanks to all for your help here.
One part of my query is still unanswered, however: what exactly is the documentation that constitutes a comp sale? Do I need the MLS listing printed out? Do I need pictures from MLS? Or just a list of properties and relevant metrics (Sqft, br, ba, etc) and their sales dates and prices? What works here?
basically, look at the residential appraisal form...picture, specs, price, price/spec, dates, etc.
"Do comps have to be recent sales, or could they be active listings that have not sold?"
Comparables (Comps) Similar properties (situated near the property you're interested in) that are currently listed for sale or have recently sold.
Comparable Market Analysis (CMA) / Competitive Market Analysis (CMA) A study, intended to assist an owner in establishing a listing price, of recent, comparable sales, properties that failed to sell, and property presently on the market.
Active listings are absolutely considered comps. All listings can help your negotiations. Properties sold hold more weight but why wouldn't active properties be important information for your short sales? I use them all of the time in my negotiations.
An active listing is not a comp. Any type of listing except one that has closed is not a comp. In the sales comparison approach, appraisers only use data from properties that have sold. A sale is not a sale until closing is completed, and title has changed hands.
As someone above posted, what actives and expireds will tell you is what the value is not. They won't give you guidance about what the value probably is.
Actually, appraisers do use pending sales and listings as comparables.
Exactly, I know because I do BPO's too. I used active, and sold properties. I use figures from all properties on the market and sold within the last 6 months. I have copies of all of my appraisals from the deals that I close and active listings are a part of the report.
"When a sales comparison approach is applicable, an appraiser must analyze such comparable sales data as are available to indicate a value conclusion."
USPAP Standards Rule 1-4
"Comparable sales data" is data on sales, not listings, not expireds. Appraisers may gather data on non-sales data, but the value conclusion in the sales comparison approach must be based on "comparable sales."
A BPO is a broker price opinion. It's not an appraisal.
If your going to quote USPAP, don't take it out of context. Your quoting part A of the following:
"In developing a real property appraisal, an appaiser must collect, verify, and analyze ALL information applicable to the appraisal problem..."
part A does not say that comparable listings and expired listings are not comparable sales data. It would therefore not be a departure of the standards rule to use comparable listings and expired listings in the analysis.
I agree with Nancy.
Is listing data usefull? Sure. Can you use listing data in negotiations? Absolutely.
What does listing data have to do with estimating FMV? Nothing.[ Edited by pspiers on Date 08/18/2004 ]
I am honored that my original post has generated such a lively dialog on this board.
I submitted my first SS offer last night, including both active listings, listings under contract, and past sales from the tax records using a service called www.myrealist.com. I was disappointed to find that most recent sales I could find on www.myrealist.com were 6-7 months old.
I will let you know how it turns out.
"I submitted my first SS offer last night, including both active listings, listings under contract, and past sales from the tax ...'
You might have missed a step, arguably the most important part of a Short sale Proposal....
You can't simply throw raw data to the folks asked to consider your Proposal and think, for a moment, that they'll take the time to read, then form an opinion about that data. They aren't real estate people...and they probably won't even know what DOM means...
You've got to manufacture that data into an Opinion, your opinion, supported by that data... all in support of your Proposal.
Unless, of course, that's what you did. I always include the data... (favorable data) but in an appendix... knowing that they probably won't take the time to read it.