Posted by Leonard Steinberg on August 20th, 2012

A new insanity has reached our shores in “Appraisal-Land”: Yes, New York Real estate appraisers have come up with a new ‘SCIENTIFIC’ method for valuing apartments that is so absurd, ridiculous and stupid, it defies logic. This is what they are doing:

The appraiser will come in for the physical evaluation and measure the INTERIOR square footage of the apartment, excluding any interior walls, or any form of the exterior walls. Then, the appraiser will multiply this square footage on the $/sf pricing that has been recorded in recent sales…..of course those sales have their square footages from the offering plans that include all the measurements the appraiser has excluded from his measurements. Insane! The difference can be 10% or more. Now some may argue that we should only pay for usable square footage…..this may be true, even though without those pesky walls, the whole place would fall down, right? My point is not to argue how we measure square footages, but more importantly that the methodology is consistent so that you are not comparing two different methodologies and applying the same value.

It’s basic, common sense. But obviously this logic escapes the world of some Appraisers in New York real estate.