Appraisers can and will go back further than 6 months if necessary. They can and do with justifiable comments. Do they like to, NO. Do the mortgage companies like them to, NO. But it is within the guidelines that are acceptable on a federal level. There are times that it is the only way that an appraiser can find comps that are truly comparable. If they have to go outside the 3/6 month range then most likely you are going to see some sort of time adjustment. Just because a home has sold in the neighborhood in the past 3 months, does not neccesarily make it comparable. Our business is not only real estate based but we also provide (Certified) residential appraisals through out the Metroplex. We have to know what is acceptable on a Federal level as well as what is acceptable to the numerous underwriters that we deal with on a daily basis. To say that they CANNOT, is simply not true. The three different methods used to determine current market value are used in different situations. The Cost Approach ( I believe you referred to it as Replacement Value) can also be required by mortgage companies along with the Comparison Approach. However, the Comparison Approach is not necesarrily within a one mile radius. It depends on the location of the property. Hope that helps to clarify up any misunderstandings.

Lr,

Our recommendation is to price the home according to your best source of information then decrease the price at regular intervals until you reach a price that begins to produce the activity that is representative of an active market....one that is a true reflection of your current RE market.

Good luck

Appraisers typically use 3 different methods to determine the current market value of a property: 1) comps (typically 3 months or less and within a 1 mile radius), 2) income analysis (used by banks especially for investment properties), and 3) replacement value (used primarily by insurance companies).

I agree mostly with Naima that most appraisers I know won't use comps that are older than 6 months; yet, they will sometimes increase the radius of the search.

Appraisers CANNOT go further back than 6 months. That was the old way when they could bend some rules by putting down an explanation. With all the lending institutions debacle, that is not the case anymore. Remember that they have to use comparables from the time of the contract, not from the time of the listing.

If there aren't sufficient comparables in the immediate neighborhood, they go to the next closest neighborhood with similar homes with age/sizes. If that is not sufficient then they make adjustments for homes that are smaller or bigger.

Naima
214-289-8555
Naima@Sumner-Realty.com

PS to my prior response:

Luxury homes are difficult to comp IF no home based on that sq. ft have SOLD in past 6 months. There is one luxury area of DFW I causes much problems true value you can have in given area home on 2 acres SOLD no other home in are SOLD in 6 months.

Appraisers and real estate agents go direct to MLS for homes SOLD if home has not SOLD via MLS then tax rolls need referred to search for homes not listed in MLS resource. NO OTHER resource is used as "other internet websites" provide value

National Featured Realtor and Consultant, Mortgage Loan Officer, Credit Repair Lecturer
Lynn911

LR,

Are you trying to figure out what to price your home at, or how an appraisal is figured? If you are trying to determine a listing price, remember that the first 30 days your home is on the market are the most critical. Price it to high and it will just sit there with little or no traffic. Your Realtor should be able to provide you with a Comparative Market Analysis of what homes are selling for in your area. Now if you are trying to figure out how an appraisal would be figured, you have a very good question. If there are truly no valid sales comps present in your subdivision, within the past 3 months, the appraiser can go out 6 months, and sometimes even longer with justifiable comments. Most lenders are requiring at least two comps within the past 6 months (preferably within 3 months) and other comps can be outside that 6 month period if nothing has sold more recently. It is always preferable to stay within your subdivision, and comps that come from outside the subdivision should be within a one mile radius (in the suburbs), and should come from similiar types of subdivisions with similar amenities. Hope this helps a little!! Good luck!

Jackie truvaluerealty@gmail.com

Honestly I would have to have an address to give a great opinion. However I would in this case normally advise my sellers to start at the price they would just love to get for the property and see how much traffic it gets and then adjust the price accordingly. I would be happy to help if you have not already enlisted the services of a Realtor. I offer flat 4% listings for full services. 3% to buyers agent and 1% for me to list. Also I make sure your property is visible in the one place it matters, the internet. As an added incentive if you purchase through me I will rebate you 20% of my commission after closing. Please do not hesitate to call @ 214-682-0598

Thanks
RJ Avery

Comp's are based on past 6 months homes sold on market "like properties' given / specific area. Usually homes closest to date of appraisal used over other homes sold further away from current date.

National Featured Realtor and Consultant, Mortgage Loan Officer, Lecturer regarding Credit Repair
Lynn911