Without a doubt there are weaknesses to the methodology of using the most recent and proximate sales as indicators of the “most probable value”. However, there are very few properties that cannot be bracketed with superior comps or with listings. By the time the appraiser gets done with these other comps, the supposedly superior subject still sometimes comes up short.
What’s killing a lot of appraisals now is when there are comparable listings at or below the contract price. The closed sales may support the price but these listings don’t. By the time an appraiser gets done laying out the relationship between listing prices and sale prices for the comps, it becomes obvious that if the listings sell at all they won’t sell higher than near the bottom of their listings ranges. If the original appraiser doesn’t catch that the lender’s review appraiser generally will. Either way, the result is the same.
