The Moore Report April 2012

The Moore Report

On April 10, 2012 a revised Fannie Mae and Freddie Mac Uniform Appraisal Dataset Specification, Appendix D: Field-Specific Standardization Requirements was released.

The following is a link to the revised document Appendix D: Field-Specific Standardization, Document Version 1.3, Version Date: April 10, 2012.

 

The revised Appendix D contains clarifications relating to the selection of Condition and Quality ratings, as well as clarifications with respect to each condition rating.

The following are excerpts from the new document. Please refer to the revised document to understand the context of the revisions.

 

Page 19: Describe the condition of the property (including needed repairs, deterioration, renovations, remodeling, etc.)
(Revisions are underlined)

Interior/Exterior Complete Inspection Reports:
The appraiser must provide the following information:

Overall Condition rating – The appraiser must select one of the following ratings that best describes the overall condition of the subject property or unit. For condominium properties, the rating must reflect the overall condition for the individual unit being appraised. Only one selection is permitted. The condition rating must describe the physical condition of the subject property as-of the effective date of the appraisal on an absolute basis, not on a relative basis or how the property relates to other properties in the neighborhood. The rating for the subject property must match the overall condition rating that is reported in the Sales Comparison Analysis section.

 

Page 27: Quality of Construction
(Revisions are underlined)

The appraiser must select one quality rating from the list below for the subject property and each comparable property. The appraiser must indicate the quality rating that best describes the overall quality of the property. Only one selection is permitted. The quality rating for the subject property must describe the overall quality of the property as-of the effective date of the appraisal and the overall quality of each comparable property as-of the date of sale for the comparable properties on an absolute basis, not on a relative basis or how the properties relate to other properties in the neighborhood.

  • Q1
  • Q2
  • Q3
  • Q4
  • Q5
  • Q6

 

Page 29: Condition
(Revisions are underlined)

The appraiser must select the overall condition rating for the subject property and each comparable property from the below list. The overall condition rating for the subject property must match the overall condition rating that was reported in the Improvements section so that it is consistent throughout the appraisal report. Only one selection is permitted. The condition rating for the subject property must describe the physical condition of the property as-of the effective date of the appraisal and the physical condition of each comparable property as-of the date of sale for the comparable properties on an absolute basis, not on a relative basis or how the properties relate to other properties in the neighborhood.

 

  • C1
  • C2
  • C3
  • C4
  • C5
  • C6


Page 35: Condition Ratings and Definitions
(Revisions are underlined)

C1: The improvements have been recently constructed and have not been previously occupied. The entire structure and all components are new and the dwelling features no physical depreciation.

Note: Newly constructed improvements that feature recycled or previously used materials and/or components can be considered new dwellings provided that the dwelling is placed on a 100 percent new foundation and the recycled materials and the recycled components have been rehabilitated/remanufactured into like-new condition. Improvements that have not been previously occupied are not considered “new” if they have any significant physical depreciation (that is, newly constructed dwellings that have been vacant for an extended period of time without adequate maintenance or upkeep).

C2: The improvements feature no deferred maintenance, little or no physical depreciation, and require no repairs. Virtually all building components are new or have been recently repaired, refinished, or rehabilitated. All outdated components and finishes have been updated and/or replaced with components that meet current standards. Dwellings in this category are either almost new or have been recently completely renovated and are similar in condition to new construction.


Note: The improvements represent a relatively new property that is well maintained with no deferred maintenance and little or no physical depreciation, or an older property that has been recently completely renovated.

C3: The improvements are well maintained and feature limited physical depreciation due to normal wear and tear. Some components, but not every major building component, may be updated or recently rehabilitated. The structure has been well maintained.

Note: The improvement is in its first-cycle of replacing short-lived building components (appliances, floor coverings, HVAC, etc.) and is being well maintained. Its

estimated effective age is less than its actual age. It also may reflect a property in which the majority of short-lived building components have been replaced but not to the level of a complete renovation.

 

C4: The improvements feature some minor deferred maintenance and physical deterioration due to normal wear and tear. The dwelling has been adequately maintained and requires only minimal repairs to building components/mechanical systems and cosmetic repairs. All major building components have been adequately maintained and are functionally adequate.

Note: The estimated effective age may be close to or equal to its actual age. It reflects a property in which some of the short-lived building components have been replaced, and some short-lived building components are at or near the end of their physical life expectancy; however, they still function adequately. Most minor repairs have been addressed on an ongoing basis resulting in an adequately maintained property.

C5: The improvements feature obvious deferred maintenance and are in need of some significant repairs. Some building components need repairs, rehabilitation, or updating. The functional utility and overall livability are somewhat diminished due to condition, but the dwelling remains useable and functional as a residence.

Note: Some significant repairs are needed to the improvements due to the lack of adequate maintenance. It reflects a property in which many of its short-lived building components are at the end of or have exceeded their physical life expectancy but remain functional.

C6: The improvements have substantial damage or deferred maintenance with deficiencies or defects that are severe enough to affect the safety, soundness, or structural integrity of the improvements. The improvements are in need of substantial repairs and rehabilitation, including many or most major components.

Note: Substantial repairs are needed to the improvements due to the lack of adequate maintenance or property damage. It reflects a property with conditions severe enough to affect the safety, soundness, or structural integrity of the improvements.

 

 

Please call with any questions or comments.

 

Brad Moore

The Moore Group, Inc. / Moore Appraisal Education, LLC
(402) 770-8605
bkmoore@neb.rr.com

dlmoore@neb.rr.com

www.mooreeducation.com

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