Today’s property appraisers and other real estate professionals face challenges on many fronts. One of the most important demands placed upon the profession is the need to provide accurate data in real time. Along with expertise accumulated from experience with a particular market, there are three pieces of information that property appraisers need to create a picture of the fair market value of a given property: sales comparables, assessor maps and property records. Old school methods of gathering these data sets were traditionally labor intensive. Fortunately, 21st century technology makes this essential data easily accessible.
Sales and Neighborhood Comps
Realtors and other real estate professionals rely on sales comparables, commonly known as “comps,” created using a method known as the sales comparison approach (SCA). Comps are critical in determining accurate home values, along with mortgage rates and terms. Comps are developed by comparing sales prices for three or more similar properties that are listed for sale or that have recently sold. These listings are often drawn from the Multiple Listing Service (MLS) database, which includes properties nationwide.
Comps are assembled by including a number of factors, such as the age of the home, its relative condition (ranging roughly from move-in ready to candidate for demolition), number of bedrooms and baths, year of construction and related features. Traditionally, assembling comps is a painstaking task. However, thanks to innovations in technology, the process is much less demanding. In fact, by providing basic contact information, it’s possible to create sales comparable report examples for up to 50 similar properties that includes data such as last sales price, living area, bedrooms, baths and even data such as Flood Zone Code status.
Assessing Property History and Value
Assessor maps are essential for verifying property ownership history, land value, building value and market value. Assessor maps also record the land value and residential record of a given parcel — not to mention the actual dimensions of a given piece of property. As this example of an assessor map for a parcel from Salt Lake County illustrates, assessor maps are often comprehensive and data rich.
However, assessor maps vary greatly between counties, making head-to-head comparisons challenging. They're necessary for verifying the property history of ownership, land value, building value, market value, land record and residential record. In addition, assessor maps are subject to change, as parcels are rezoned, consolidated or subdivided and properties are bought and sold.
Maintaining current, accurate assessor maps is crucial, but often difficult to achieve with typical low-tech methods. However, today’s technology makes it possible to obtain detailed and accurate assessor map data through an APN database with a national reach.
Property Ownership Records
Developing mortgage terms is an obvious and essential element of the home buying and selling process. There is a need to strike a delicate and crucial balance between being overly restrictive — thereby potentially driving away good business — and being too liberal, resulting in a portfolio burdened with risk of default.
Various details enter into the process of developing mortgage terms including liens, mortgage history, ownership and encumbrance (o & e) reports and titles. Analyzing and synthesizing various moving parts requires painstaking attention. At the same time, today’s homebuyers are not willing to sort through stacks of paperwork and wait weeks for a mortgage lending decision. Property appraisers are under tremendous demand to develop reports within days, if not minutes. Those who fail to do so risk losing out to competitors who are up to the task.
Once again, technology rises to the occasion by enabling automation of much of the process. However, many property appraisers are understandably wary of relinquishing tasks such as verification to an algorithm. After all, property appraisers also have a fiduciary duty to provide accurate information. Fortunately, there is no need to choose between speed and accuracy. It is possible to obtain faster property records through an automated record verification service that utilizes multiple independent sources, while maintaining crucial accuracy.
Creating the Big Picture
Property assessment demands the most accurate and comprehensive data available. Access to sales comparables, assessor maps and property reports are essential in facilitating the mortgage lending process. Old school methods for accessing these important data sources are needlessly labor intensive and slow — not to mention subject to human error. They are not up to the demands of today’s demanding clients — especially tech-savvy younger homebuyers.
DataTree's Mortgage Lending Analytics allows property assessors to streamline their efforts without sacrificing quality or accuracy. Check out the DataTree website to learn more about how automation can help make the mortgage lending process faster and better.
Title: Mortgage Data Analytics | Property Reports Online
Description: There are three pieces of information that property appraisers need to create a picture of the fair market value of a given property: sales comparables, assessor maps and property records.