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The 6 Month Rule

August 26, 2016 by 2 Comments

The Coyle Group - 6 Month Rule - Philadelphia Real Estate AppraiserWhile at an appraisal inspection in the Fishtown section of Philadelphia I met a Realtor who asked a question that I get a lot.  As he handed me the comparables sales he used to price the property, he asked…

“Why can we only use sales that settled in the past six months?”

Ah, the old 6 Month Rule. Well, the truth is there is no rule set in stone that says appraisers can only use comparables that have sold in the last six months.  While it would be ideal, that isn’t always possible.

It’s the appraiser’s job to identify the BEST comparables available.  If that means going back 7 months, that’s OK.  If it means going back 12 months, that’s OK.  If it means going back 18 months, that’s OK, too.  However, it is the appraiser’s responsibility to explain why they used sales older than six months.

For instance, if I have a perfect comparable located next door to the subject that sold 11 months ago…you bet I’m going to use it.  I’d probably be remiss if I didn’t.  As appraisers we can and should make time adjustments to reflect any movement in the market since the time of the older sale.  Note: In our office, we start by setting our search parameters at 12 months for each assignment.

So, next time you’re meeting an appraiser and want to provide sales data, feel free to provide sales older than six months.  I’d recommend no older than 12 months unless the sale is really relevant to the subject.  I’d also recommend providing only truly comparable sales to the appraiser.  You’d be amazed at the “comparables” we are given sometimes but, that’s a topic for another blog post.

The Coyle Group’s team of Philadelphia Real Estate Appraisers are a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy, Tax Appeal and Pre-Listing. If you need a guest speaker at your next sales meeting, please give us a call. We would welcome to opportunity to speak to your group and field any appraisal related questions you may have. For more information please visit our website at www.TheCoyleGroupLLC.com You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

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ATTENTION AGENTS!!!

June 7, 2016 by 6 Comments

Attention Agents - The Coyle Group

Attention all Real Estate Agents!  Do you want to stand out from the crowd and really stay in the minds of your clients and prospects?

Well, you’re in luck…its tax appeal season!  For the next few of months homeowners across the Philadelphia region will have a chance to appeal their tax assessments.  This is a great opportunity for real estate agents to reconnect with current clients, old clients and prospects!  It’s also an opportunity to bring real value and show them that you’re not just any-old real estate agent but, a trusted partner who is looking out for their best interest.

Over the next few weeks, try reaching out to your old clients and prospects suggesting that they might want to consider appealing their taxes.  Show them that you’re looking out for them and want to help them save money.  Imagine how happy your client would be if you were able to help them save hundreds or thousands of dollars off their tax bills each year!

If you have any questions on how the assessment and appeal process works (in Philly, Montgomery, Bucks, Delaware, Chester or Berks Counties) or how to figure out if your clients/prospects would be good candidates for an appeal, please feel free to contact our office.

The Coyle Group’s team of Philadelphia appraisers are a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy, Tax Appeal and Pre-Listing. If you need a guest speaker at your next sales meeting, please give us a call. We would welcome to opportunity to speak to your group and field any appraisal related questions you may have. For more information please visit our website at www.TheCoyleGroupLLC.com You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

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Attention Attorneys: That Appraisal May Not Be Valid

April 29, 2015 by 9 Comments

If you’re an attorney or legal professional and engage the services of residential real estate appraisers for divorce, estates, bankruptcy or tax appeal, you need to read this.  It could be the simple difference between your case succeeding or failing.

Most attorneys’ primary concern when they order an appraisal is the final value and how it will affect their case. They are usually not too worried with how the report is presented, so long as it is defensible. Many attorneys are used to receiving residential appraisals on the URAR 1004 Form which is the most commonly used Form for residential appraisals.

Why give it a second thought, right?  Wrong.  This could prove to be a huge mistake.

FACT: The common URAR 1004 Form is not intended to be used for valuation matters other than mortgage finance. (It even says so right in the report.)

The Coyle Group - URAR Blurb

 

 

 

Yet, all too often, this is the “go to” Form for appraisers who may not be experienced performing appraisal for legal purposes. Their mistake could cost you your case.

Imagine being in court for a hearing and presenting your appraisal prepared on the URAR 1004. While the court may not know the nuances of the Intended Use of a URAR 1004, a savvy opposing counsel, township solicitor or expert appraisal witness could very easily point this out. Technically, the report is invalid as a result of the Form’s Intended Use being violated by the appraiser. The court could deem the report inadmissible and jeopardize your client’s case.

There is a simple solution. There are a number of general purpose appraisal forms available to residential real estate appraisers that are also in compliance with USPAP*. They are typically called GPAR Forms (General Purpose Appraisal Report) and they address most residential usages (single family, multi-family and condo.)  The Appraisal Institute has even developed its own USPAP compliant GP Forms as have most appraisal software providers.

The Coyle Group - GPAR

So, next time when ordering an appraisal; be sure to specifically ask your appraiser which Form they intend use. If they say the URAR 1004, you need to insist that they use a GPAR Form or you run the risk of presenting an invalid appraisal.

Hopefully, you found this informative and helpful. If we can ever be of assistance with your appraisal needs for estates, divorce, bankruptcy and tax appeal; or if you have any appraisal related questions, please do not hesitate to contact us at 215.836.5500 or appraisals@coyleappraisals.com .

* USPAP: Uniform Standards of Professional Appraisal Practice

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Don’t Trust Your Divorce Appraisal To Just Any Appraiser

December 15, 2014 by 2 Comments

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Why and When You Need a Real Estate Appraiser

November 24, 2014 by 2 Comments

The Coyle Group - Money HousesA real estate appraisal is one of the most critical parts of the real estate process. The appraisal benefits everyone involved in a real estate transaction including a buyer, seller, investor, trustee, heirs, and more. Although it may not be required in every situation it should always be considered as one of the first steps you take when the sale or division of real estate is involved.

An easy definition of a real estate appraisal would be; “the process of estimating the fair market value of your home or property at any given point in time.”

The following are common situations in which real estate appraisals are often needed:

  • You’re applying for a loan against a property as part of a refinance or equity line of credit on your existing home
  • You’re applying for a home loan against a property you’re planning to buy
  • You need to know the retrospective or historical value of a property as of the date of one’s passing for estate purposes
  • You’re going through a divorce involving the division of real estate
  • You’re going through bankruptcy in which a home or property value is needed by the courts as part of the settlement process
  • You’re a homeowner looking to lower your property taxes because the county has over-assessed your property
  • You’re a realtor or FSBO looking to establish current fair market value for list purposes

What to Look for in an Appraiser

The first thing you should check is an appraiser’s qualifications including their certification and/or licensure. Every state requires that real estate appraisers be licensed in their state of residence. You should avoid working with any appraiser who is unable or unwilling to provide you with their license information.

Here are a few other items you should look for when hiring an appraiser:

  • Reputation is a valuable tool in choosing a good appraiser. Although the lender will usually select their own appraisers for most lending situations, in other cases it’s always best to ask for referrals from someone you know and trust. You should also always check online to see if the appraiser you’re looking to hire has any reviews worth noting.
  • Is the appraiser willing to walk you through the appraisal process including going over the final report with you and answering any questions you might have.
  • Professional, experienced, and geographically knowledgeable should be the key hiring factors you look for in an appraiser and NOT cheap and fast. Appraisers must also be impartial and give their honest, unbiased opinion of the value of the property without favoring one “side” or the other. Any conflict of interest should be revealed and dealt with upfront and in some cases the appraiser may have to refer you someone else to avoid any possible conflicts.

An appraiser’s fees are usually based on their level of expertise and experience in the industry as well as the complexity of the assignment. Considering the importance of an appraisal, you should never use the appraisal fee as the main determining factor as far as which appraiser to work with, as that could cost you dearly in the long run.

I hope you found this helpful and if you have any additional questions, thoughts, or comments please leave them down below.

The Coyle Group, LLC is one of the most well-respected and sought after appraisal firms in the greater Philadelphia area specializing in residential and commercial appraisals for divorce, bankruptcy, estate, date of death, tax appeals, pre-listings, and more. For more info contact us at 215-836-5500, http://www.thecoylegroupllc.com, or email us at mcoyle@coyleappraisals.com.

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PMI Removal

April 2, 2014 by 5 Comments

The Coyle Group - PMI RemovalIf you bought a home with less than a 20% down payment, chances are you’re paying Private Mortgage Insurance (PMI).  This is a cost that your lender adds to your mortgage payment to insure their risk exposure, should you default.  Depending on the amount of your mortgage, your PMI payments could be a few hundred dollars more per month.  Some lenders use the 1% rule of thumb.  That means you will pay 1% of the loan amount until the equity threshhold is met.  If you have a $200,000 loan, your PMI could be around $200 per month.

But don’t worry; PMI is not forever unless you put less than 10% down and took out an FHA-insured loan, then you will have PMI for the life of the loan.  Check with your local lender, typically will be removed once your equity position reaches 22%, meaning your loan is now 78% of your purchase price or appraised value.

“Well, how do I know that my equity has reached that magic number?”

Typically, once your Loan to Value Ratio (LTV) has reached 80% of your property’s original appraised value, your currrent mortgage service provider will allow you to have PMI removed, upon request.  You have to be proactive in initiating this conversation.  They will not simply remove the mortgage insurance until, by law, your LTV drops below 78%.  When it does, your mortgage servicer is required to remove the insurance.

There are other situations that could prompt your lender to waive PMI.  Perhaps, you made some improvements and/or renovations to your property which increased it’s value.  Another scenario is an appreciation in the market.  While I know the word “appreciation” has been missing from our real estate vocabulary over recent years, there are whispers of it in the air.  Now could be a good time to take a shot at getting your PMI removed.

AGENTS:  This presents a great opportunity for you to reconnect with former clients and possibly help them save some money.

“How do I go about showing that my equity has increased?”

First, pick up the phone and check with your lender to see if they have any special instructions for requesting PMI removal.  Different lenders may have different requirements.

There are other important criteria you must meet if you want to remove PMI on your loan:

  • requests must be in writing;
  • the borrower must have a good payment history and be current on your payments;
  • your loan servicer may require you to certify that there are no subordinate liens on your home (such as a second mortgage);
  • your loan servicer may require you to ensure (i.e. an appraisal) that the value of your property hasn’t dropped below the value of the home when you bought it.  If the value of your home has decreased, you may not be able to cancel PMI.

Most lenders will require a current appraisal of your property.  Some will allow you to select your own appraiser; while most will require that you use an appraiser from their panel of preferred appraisers.  Either way, confirm this with your lender.  You don’t want to have to pay for two appraisals.

If an appraiser visits your home, be sure to share with the appraiser any improvements that you haved done to the house since you bought it.  This will help give the appraiser a better understanding of where your house was relative to its current, improved condition.

The time to act is now.  Every month that passes is just another month you could be saving on PMI payments.  Look at it this way, if your PMI is $150 per month, that’s a savings of $1,800 per year!

If you have any questions related to PMI removal or real estate appraisal matters in the Philadelphia area please feel free to give The Coyle Group a call 215.836.5500 or visit our website www.thecoylegroupllc.com .

Special thanks to Mark K. O’Neill, Senior Loan Officer, with  Mortgage Master for his assistance with providing background on PMI and fact checking.  If you are unable to get PMI removed, you may want to contact Mark.  He may be able to refinance your loan without PMI provided you have at least 10% equity in the home.

The Coyle Group’s team of Philadelphia appraisers is a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy, Tax Appeal and Pre-Listing appraisals.  If you need a guest speaker at your next sales meeting, please give us a call.  We would welcome to opportunity to speak to your group and field any appraisal related questions you may have.  For more information please visit our website at www.TheCoyleGroupLLC.com  You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

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Ignore the Groundhog, Check this Out!

February 19, 2014 by 4 Comments

The Coyle Group Philadelphia Appraiser - GroundhogAfter what seems like an unrelenting barrage of snow storms, ice storm, polar vortexes, days off from school and the dreaded 2-hour delay, I have some hope to offer.  This is not hope derived from some rodent (yes, a groundhog is a rodent) in a town in the middle of Pennsylvania.  This is hope in form of a visual aide based on historical trends.  Sounds enticing, huh?

Just as we know Spring will come to Philadelphia, we also know that with the warmer weather comes The Spring Selling Season!  This is the annual phenomenon where Buyers and Sellers come out of their wintry hibernation and start moving real estate.  It’s a great time of year for agents and appraisers alike.

In an effort to provide all with hope, I’ve prepared this graph of the Average Sale Price in Philadelphia from January 2000 to January 2014.  The graph clearly shows a growth trend over the past 14 years.  You can see the build-up from 2000 through the peak in the summer of 2006.  You can follow the market downturn from 2006 through 2011.  In 2012, the market appears to begin a slow turn around and incremental movement in a positive direction.

The Coyle Group Philadelphia Appraiser - March Trends 2014

Click on the graph for a larger version.

I’ve highlighted the month of March for each year in yellow to help illustrate my point.  Nearly every year, March marks the beginning of an upward swing in the market.  The red line is a trend line that was added to provide even more hope and good vibes.  Almost every year, the red line shoots up dramatically after the yellow March column.

I’m sure the same will happen this year.  So be hopeful!  The Winter will end, Spring will arrive and the Philadelphia Spring Selling Season will start very soon!

The Coyle Group’s team of Philadelphia appraisers are a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy, Tax Appeal and Pre-Listing appraisals.  If you need a guest speaker at your next sales meeting, please give us a call.  We would welcome to opportunity to speak to your group and field any appraisal related questions you may have.  For more information please visit our website at www.TheCoyleGroupLLC.com  You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

 

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2014: Year of Recovery

January 7, 2014 by Leave a Comment

Happy New Year!  I’m confident that 2014 will be the year of real estate recovery, in the PhiladelphiaThe Coyle Group Philadephia Appraisers 2014 region.  With that optimistic statement out of the way, let’s get down to reality.

While I do expect markets to appreciate (yes, remember that word), I don’t expect to see a huge upswing in value.  Instead, I expect that we will return to nice, steady, predictable increases in value.  Think in the range of 2-4% per year.  Sure, there will be some areas in the Philadelphia market that will outperform but, for the most part measurable, healthy growth will be the new norm.

What will keep values from ramping up like back in 2004?

Inventory is relatively low.  However, there is a huge shadow inventory of foreclosed properties that banks will start releasing to take advantage of the healing market.  In fact, a trend that I’ve noticed in the past few months is that more and more banks are pumping money into rehabbing their stock of foreclosures in an effort to get top dollar.  In 2014, it’s pretty likely that foreclosures will compete rather strongly with conventional sales in some Philly markets and the surrounding suburbs.  This, along with the typical Spring listing surge, will influence supply.

Agents tell me that there are plenty of buyers waiting in the wings.  However, interest rates are expected to increase.  This will keep some buyers sidelined, especially the first-timers and low-income groups.  This will influence demand.

It all boils down to Economics 101, supply and demand.  It always does.  I think that each will be kept in check by the other and that growth will occur, it just won’t be a rocket ride.  That being said, I expect a pretty healthy Spring Selling Season as eager Sellers and Buyers enter the market.  This should facilitate an evenly paced recovery with real legs.

What are your predictions for the 2014 Real Estate Market in the Philadelphia region?

Best of luck in 2014!

The Coyle Group’s team of Philadelphia appraisers are a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy and Tax Appeal.  If you need a guest speaker at your next sales meeting, please give us a call.  We would welcome to opportunity to speak to your group and field any appraisal related questions you may have.  For more information please visit our website at www.TheCoyleGroupLLC.com  You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

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2013 Philadelphia Region’s Most Expensive Homes

December 13, 2013 by Leave a Comment

Let’s face it, 2013 is pretty much over.  With Christmas falling on a Wednesday and New Year’s Eve and Day following shortly thereafter, there are only about 8 “real” work days left.  So, it seems like a perfect time to take a look back at the 2013 real estate market.  In particular, let’s take a look at the ultra high-end sales in the market.*

The Philadelphia Metro Area (Philadelphia, Montgomery County, Bucks County, Delaware County & Chester County) had its fair share of heavy hitters this year.  In total there were 20 sales over $3,000,000 and there are currently five sales pending over that amount.

The Coyle Group - Bucks County MansionBucks County posted a $3,300,000 sale with the property at 6356 Meetinghouse Road, in New Hope.  In this case, the price gets you a 20-year-old, 12, 376 Sq Ft, Colonial situated on 92.78 acres.  A perfect little “country” getaway home for New Yorkers.

 

 

The Coyle Group - Villanova MansionIn the Villanova section of Delaware County there was a $4,000,000 sale at 265 Abrahams Lane.  What’s interesting is that price was achieved at auction, down from the original $7,695,000 list price.  Looks like a pretty good deal for the 12-year-old, 10,268 Sq Ft, Mansion sitting on 9.90 Main Line acres. 

 

The Coyle Group - Philadelphia Rittenhouse Mansion

 

At $4,200,000 cash, the “McIlhenny” Mansion, at 1914-16 Rittenhouse Square was the highest sale in Philadelphia.  This mansion faces Rittenhouse Square and is built on five property lots.  The 8,600 Sf Ft structure was listed as being “in need of complete restoration.”  Kind of pricey for a fixer-upper but, that being said, there is nothing else like it in Philadelphia.  New owner Bart Blatstein just received the “go ahead” from the planning commission for renovations to the historic property.

 

 The Coyle Group - Chester County Mansion

Saddle up!  If you like privacy, views and horses, and you happen to have $5,000,000 lying around then you could have purchased the property at 2300 Hilltop View Road, in Chester County.  This 27-year-old, 10,061 Sq Ft, Converted Barn sits on 143.70 acres.  This is a true equestrian property with 14 stalls, paddocks, indoor riding ring, tack room and abuts 800 acres of preserved land. 

 

The Coyle Group - Montgomery County MansionThe honor of being the most expensive home in the Philadelphia Metro Area for 2013 goes to 648 Creighton Road, in Villanova.  This Tudor Mansion is over 80 years old and boasts 13,464 Sq Ft of living space situated on 3.13 acres, in Lower Merion.  This is a classic Main Line residence with a $5,700,000 price tag to prove it.

 

 

The Coyle Group’s team of Philadelphia appraisers are a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy and Tax Appeal.  If you need a guest speaker at your next sales meeting, please give us a call.  We would welcome to opportunity to speak to your group and field any appraisal related questions you may have.  For more information please visit our website at www.TheCoyleGroupLLC.com  You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

* Only sales advertised in the MLS were included.  No private sales were used.  Photos are courtesy of TReND MLS.

 

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What Makes a Divorce Appraisal Different?

December 6, 2011 by 1 Comment

Let’s face it, going through a divorce is an emotionally challenging time for everyone taking part.  It involves many difficult decisions about the kids, investments and marital assets, including who gets the house.  When it comes to the house and other real estate, the two most common choices are selling and dividing the proceeds, or one party can “buy out” the other.  In either case, one or both parties will order an appraisal of the residence and other real estate holdings.

A divorce appraisal is not the same as your typical appraisal used for lending purposes.  Some of the differences are:

  • The divorce appraisal is likely to have a retrospective date of value, meaning the value of the property will be based upon a date in the past (perhaps the filing date, the date of marriage, the date of separation or the date of purchase) rather than the current date.
  • In some cases the appraisal will provide both a retrospective value as well as a current value.
  • Occasionally, in a divorce situation, the appraiser may be called upon to testify is count as an expert witness.  As a witness, the appraiser may not be an advocate for either side of the proceedings, regardless of who may have hired him.  The appraiser may only testify about the appraisal and the data/analysis contained therein.
  • Since a divorce appraisal is not related to financing or lending, it does not have to comply with Fannie Mae guidelines (or UAD Guidelines).
  • Typically, a divorce appraisal is completed on non-Fannie Mae forms such as the GPAR forms or it is written in a narrative format.
  • In completing a divorce appraisal, the appraiser is bound the same confidentiality and USPAP requirements that he would be in completing a lending appraisal.  That means that the appraiser cannot share information about the appraisal with any party other than his client and/or his client’s attorney, unless legally required to do so.

If you are going through a divorce or are an attorney or mediator and are in need of a divorce appraisal, market research or just have a general real estate value related question, please fee free to call 215.836.5500 or email appraisals@coyleappraisals.com 

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