Though I have done hundreds of BPOs (not thousands like some of the cooler peeps here), the one segment always challenging to me is the opinion of value. That question.....How did you arrive at these values? Uh, well, I looked at the sold comp values, sort of sat there for a minute, took a sip of my margarita, crossed my eyes and there it just sort of popped out at me....Obviously, I can't write that. And they give such a large area for it...I mean, it isn't that complicated. So what sort of things do you put in there?

Did you equally weigh all three sold comparables in determining the subject's value, or did you put more emphasis on one or two of the sold comps? If your market is dramatically falling in terms of value, then did you put more weight on listing comparables?

There are other possible scenarios where perhaps special instructions wants a distressed sale value, and you have one perfect comp that matches that. You could emphasize that one in that particular instance. The scenarios obviously vary.

I think the mill/customer just want to know your process on your final number.

Ohhh.. thats a good one ...I will have to try that...cross my eyes while I drink...I should come up with some good numbers! LOL

Before some of the Appraisers on here jump on ya, please remember to choose your words carefully - no matter what some forms may say. As BPO agents, we give Price Opinions. Appraisers give Opions of Value. This is just a friendly reminder.

The form literally says "explain how you arrived at your value....."

Completely understand this. Please re-read my post... No matter what some froms may say, etc, and so on... As Real Estate Agents (and there are Appraiser lurkers, and posters) who will & can back this up, we (BPO Agents) give Price Opinions - Broker *Price* Opinions. Appraisers give Opinions of Value. This is not to creat anger or what have you, this is simply a fact.

It depends. Even though I've done hundreds of BPOs, not all houses get priced out the same and I don't explain them all the same.

Some have modelmatches so that's easy and some you have to go by average area price/sq.ft. plus or minus for condition.

Most of it is by feeling though, we've taken out enough Buyers and gone on plenty of brokers tours and inspections to know what a house will sell for - we know what Buyers and Investors love and don't like, can and can't tolerate. So we know where we're going to put that house on the range - either towards the top or the bottom.

And I can see the value of a margarita (hand-poured, on the rocks, salt on half the rim) in helping set aside the number crunching and getting in touch with your feelings (but not too much -- alcohol is ether + a water molecule and its effect is to cause unconsciousness)

For instance, a ranch house with a master on one side and clear across the other side are the kids' rooms. Right there, that knocks out most all the families with babies and toddlers. So we know to knock down the value because it has limited appeal. KWIM?

Your knowledge of the area plays a big part here.
School districts play a big part in value. There's 3 or 4 around here that are having real, publicized problems, so a newer 2500 sf house is worth less than one in a preferred district that may be only a half a mile away.
Crime statistics are public information and plays a large part in values. No one wants to move to a high crime area.
Tax rates, which are also public knowledge, make a difference to buyers and play a part in the value.
SO the short answer is - You have been hired for the work because you have knowledge of real estate values in the area. Make sure that your Opinion of Value is backed up with information that is factual and current.

Couple months back SS hit with me QC due to my comments about drugs and crime..Whatever!

CC says that you can't put "high crime area" in your report because it's discriminatory and instead wants to see "less desirable." I think "high crime" is a much better term than "less desirable," as less desirable seems like it would be more prone to discriminatory connotation. With crime, it's a statistical fact that is either high or low regardless of any racial or ethnic issues. However, they did say that if you can include a crime statistic report, then you can use the word crime. That's what I've done, as I think indicating that it's a high crime neighborhood gives a much better reason as to why it has a much lower value than nearby neighborhoods.

Yes, it's a crime to use the word crime. High police presence has always worked with me. Thus far anyway.........

In some areas around here, well, that's why there's high crime... because there isn't high police presence.

In the so called High Crime Areas, there generally is one of those street corner memorials nearby. I just include it in the photo upload.

maintained and kept typical of the age and location...I think that explains everything...without offending anyone...