Appraisal and Market Information
Answer:
Steven should recognize immediately that his neighbor expects him to respond
as an appraiser; therefore, Steven’s answer should comply with USPAP.
Steven can, of course, always decline to answer.
Alternatively, Steven could provide data, such as, “I’ve been keeping track of the house sales in our subdivision, and they have been from $100,000 to $150,000 over the past couple of years.” Giving such information is a part of appraisal practice for which there are no Standards (i.e., STANDARDS 1 and 2 when providing real property appraisals). Steven should be certain that he is acting ethically and competently in giving this kind of information, but he doesn’t need to prepare a workfile for it.
Steven should be careful, though, about applying any judgment in answering his neighbor’s question. If Steven says, “House sales in our subdivision in the last year have been from $100,000 to $150,000. I know that you’ve done lots of interior improvements to your house and, besides, it’s the more desirable two-story model, so its value should be near the high side of the range,” he has just performed an appraisal. In this case, he should comply with STANDARDS 1 and 2 and prepare a workfile. If Steven only provides data, he is acting within appraisal practice, but if he relates that data to a specific property, he has provided an appraisal.