I just attended a seminar on this topic and came away thinking the program doesn’t go far enough to be effective.

In brief, UMDB is a standard for residential appraisals to have consistent terminology so that lenders and investors can better understand and manage their risks. It requires the appraiser to better understand the condition of comps they are using, e.g. are the kitchen and bathrooms more than 15 years old and do they need “updating” or “remodeling”. Since the only way they have primary knowledge of such information is to have inspected the comps, in most cases the only source is the listing or selling realtor. What are chances of a realtor remembering the condition of the third bathroom of a house they listed a year ago that someone else sold six months ago? If it were me, I’d do well to remember much more than my commission on the sale. And MLS photos never show shortcomings in the house.

Apparently realtors are not required to use these new standards so their MLS listings will continue to describe 95% of houses as well above average. The appraiser can and should do a good job applying UMDB to the Subject property, but the comps are a different story.

I applaud the new standards, but until they are used further down the food chain and include MLS listings, they are likely to give a sense of security that simply will not be realistic.