Analyzing Complex Appraisals for Business Professionals

Chapter 2

Analyzing the Single-Family Residential Appraisal

The Sales Comparison Approach

In the ideal single-family residential appraisal, if the appraisal had three comparable properties, one would be slightly higher, one slightly lower, and one exactly the indicated value for the subject property. In reality, a range of comparable sales like this is rarely found, so the appraiser must do the best job with the sales that are available.

Exhibit 2.1 is the sales comparison approach sheet for a typical single-family residential appraisal, which is on what is called a Fannie Mae Form 1004. Most residential appraisals use this form because it is the one needed to sell loans to the Federal National Mortgage Association (Fannie Mae) and Federal Home ...