Time adjustments are now required by Fannie Mae and Freddie Mac. Time adjustments were previously required “when necessary.” Now a “market conditions” adjustment is required on every appraisal. This means that even if personal judgment says the subject market is “stable,” an analysis must be performed to arrive at the zero adjustment conclusion. An FHFA (Federal Housing Finance […]
It is clear: market analysis and time adjustments are more important than ever, and the appraisal and review requirements are critical to responsible valuation, compliance, and risk management. Time adjustments and market analysis was the topic presented in our TYN2K Webinar January 15, 2025. Fannie Mae’s Lyle Radke was our presenter, followed by a two-hour […]
Time “adjustment” is not really about time (or so they say). It’s about changed market conditions since the time of the comparable sale. This wording works fine for legacy appraisal practices. The modern, data-centric, data science approach is clear that the market conditions are measured at points in time (or a continuum of time). Thus, […]
Is time an adjustment? What is “acceptable” appraisal practice? The new GSE (FannieMae, FreddieMac) guidelines still require adjustments for market conditions. This is part 8 of our series on GSE Guidelines. Read the series here. Market conditions are different at different points in time. Duh! Time adjustments have always been required. Seldom enforced. Seldom done. […]
My New Year’s resolution may work, or it may not. How do I create a high probability I will be successful? There is a science to this. There are issues of personal psychology. And there are some spiritual principles that work. Finally, physical action directly causes results. And how about willpower? How do I resolve […]
Ethics is a discipline about what is morally good or right. In this time of much religious celebration, we note that most religions are based on specific spiritual principles. These are behaviors that most recognize as being healthy for the individual and for society. Ethics easily touches other areas of study, including anthropology, biology, economics, […]
Fun insanity — time adjustment requirements made simple. A concise market conditions guide and summary. Editor’s Note: This is part 7 of a new series on Time. Get caught up here. Let’s outline the new GSE requirements: Time “adjustments” will be a required field, even if exactly zero! (Zero is a number.) Time-series analysis is […]
Time-series adjustments and market conditions are required by Fannie Mae and Freddie Mac. Part Six on GSE Guidelines. Read the series here. A recent FHFA research paper revealed that as few as 10% of appraisals had been even attempting a time adjustment, although in some markets, where the value was not “high enough,” the time […]
First, note that the time adjustment is core to market analysis. It is not about “comparing comps.” It quantifies two things. The change in: 1) the value of the dollar and, 2) market segment price levels. This is part 5 on our series on GSE Guidelines. Read them all here. Reference: FHFA Working Paper 24-07: […]
How do we connect Thanks Giving with Critical Thinking? First, we can recognize gratitude (giving thanks) as a neuro-spiritual tool – with benefits. And we can recognize critical thinking as a tool towards good judgments and action. So how do we connect these seemingly detached (thanks and thinking) ideas? Critical thinking is a necessary part […]
Recent GSE (Fannie Mae and Freddie Mac) guidelines for appraisers and lenders make some assumptions. In particular we can use, for example, the requirements for market analysis and time adjustments. This is part 4 on our series on GSE Guidelines. Read the series here. USPAP (Uniform Standards of Professional Practice) Rule 1-4 states that an […]
A time adjustment is needed because all our sales data is historical. A sale price 6 months ago cannot be properly reflected in today’s dollars. Two parts. Two components. Two reasons: The value of the dollar has changed. The competing market price level has changed. Editor’s Note: This blog is part 3 on the GSE […]
Recently, Keith Wolf (representing Freddie Mac), coined a new term for claims about adjustments, calling it the “adjustment fallacy.” Adjustments to comparables first arrived on the scene as a way of explaining differences between the subject property and a compared comp. (A way to ‘support’ an opinion comparison.) In theory, an adjustment is supposed to […]
Should the AI (Appraisal Institute) teach AI (Artificial Intelligence)? This is Part 2 on the Series of the Appraisal Institute and Artificial Intelligence. Read Part 1 here. AI tools, such as ChatGPT, depend on prior knowledge being published somewhere out there in the cloud. Somewhere. The AI (the education provider) continues to emphasize the supremacy […]
The new UAD and URAR come on together. In this second part of our series on UAD and URAR as we prepare to look at possible unintended consequences. (Catch up and read part 1 here.) In later continuing parts, we will look at how the URAR/UAD format “dynamic” may affect users: appraisers, lenders, AMCs, and […]
