How to make value adjustments for a subject property?
Sometimes, the value of a property automatically derived from the sale or list prices of comparable properties may not an accurate reflection of the subject property’s value. In such cases, iCMALive provides you a way to further tweak the value using “Value Adjustments”.
Value adjustments is available as an option when you create a Custom CMA or if you edit an Instant CMA. Here are the steps starting with a Custom CMA.
Once the comparable sales and listings are selected, iCMALive automatically estimates a Fair Market Value for the Subject Property based on your selections.
In certain cases you may choose to tweak that Fair Market Value based on certain upgrades on the subject property or in the comparable properties and also consider the current condition of the property.
Step 1: You can click on “Value Adjustments” button in the Comparable Recommendations page. At least 3 comparable sales or listings must be selected to enable the Value Adjustments button.
Step 2: On the Value Adjustments screen, the attributes of the Subject Property and the comps are shown side-by-side with each row representing a specific property characteristic.
There are 2 types of property characteristic adjustments you can make on this page:
- Auto-Adjustments: Numeric property characteristics for which you get to set a value and the adjustments are automatically calculated. For example, the number of bedrooms or bathrooms or the living area are numeric fields. If you enter the value of a single bedroom, the adjustments are automatically applied for the comparable properties.
- Manual Adjustments: There are other property characteristics such as pool, porch, brick front, etc which do not have a quantity. For such characteristics you can directly set an adjustment value for a comparable property.
For example: You can if you set $2,000 as the value for a bathroom, then any comparable which has more or less bathrooms than the subject will be automatically adjusted for their values. The change in price will be shown in the respective column of the comparable.
If for some reason you find that the valuation for a specific comparable’s bathroom should be different from the others, you can override it by clicking the checkbox next to the value and then enter your own value.
Step 3: You can add comments for adjustments that were made to the value, the comments provided in the field will appear in report which helps the client understand the reasons for the adjustments.
Result: The Adjusted Fair Market Value is automatically calculated from each of the adjusted comparable property values.
The Adjustment Fair Market Value is a weighted average of the adjusted values of the comparables. You may edit the weights as you wish considering the proximity and other neighborhood considerations of the comparable property.
The Adjusted Fair Market Value is displayed along with Fair Market value at the top of the comparables table.
Hope this feature comes in handy for your CMA reports. Please let us know if you have any suggestions for improving this capability.
