Question:

I was recently asked to complete a retrospective market value appraisal for which the effective date of the appraisal is two years prior to the date of the report. In researching this assignment I discovered several comparable sales that were listed, placed under contract, and sold well after the effective date of the appraisal. Would it be appropriate to use only these sales in my sales comparison approach to value?

Response:

No. In a retrospective appraisal the analysis should reflect the market conditions that existed on the effective date of the appraisal. Only using comparable sales information that was not available to the market place, or did not exist as of the effective date of the appraisal would be misleading because it would not reflect information available to the marketplace during that time period.

Consult SMT-3, Retrospective Value Opinions for additional information.