Appraisers use a variety of software tools to aid them in compiling the data and performing the calculations necessary to complete the 1004MC. The most common are:
SMART is the most comprehensive market analysis tool that is readily available to the residential appraiser. This software does far more than generate the entries required for the 1004MC data grid. It is a comprehensive analytical engine that can greatly increase an appraiser’s awareness of what is truly going on in the market. It works by analyzing data that is selected by the appraiser. SMART is available at no charge to ServiceLink appraisers.
Many appraisers also use DataMaster. This software is similar to SMART in many ways, but it does not work with as many different MLS systems.
For more information on SMART (Statistical Market Analysis in Real Time)
For more information on DataMaster:
Many appraisers rely on 1004MC “wizards” that are built into the local MLS system. Such solutions tend to be very simple to learn, because they are based on a user interface that is already familiar to the appraiser.
While these MLS software tools are appealing, there are two common issues noted in such systems. Many of them do not allow sufficient control over the data that is analyzed. The 1004MC data grid should report comparable properties located in the subject’s neighborhood. Hence, the appraiser must be able to control the search area so that the “neighborhood” searched corresponds with the “neighborhood” described in the appraisal report.
It has also been noted that some MLS systems do not perform all the required calculations in the correct manner. Known issues include MLS systems that report all listings over a time period rather than just those active on the last day in that period. As was noted earlier, Fannie Mae changed the instructions for completing that section of the 1004MC, and some MLS systems have not been updated to reflect that change.
Another known issue is that some MLS systems do not calculate the Sale Price as a % of List Price correctly.
Though not as popular, some appraisers use spreadsheet programs (such as Excel) to analyze raw data that is exported from the local MLS. Many such spreadsheets can be found on the Internet using common search engines, and many are available free of charge. For a person with adequate training on the use of spreadsheets, this can be a viable option.
Before using any software tools, the appraiser should be trained in the proper use of the tool and take the time to conduct tests to ensure that the software is performing correctly. The fact that a software tool is used to help analyze market data does not absolve an appraiser from the responsibility to ensure that the data is reported correctly and accurately.
Fannie Mae Announcement 08-30
Appraisal and Property Report Policies and Forms Frequently Asked Questions (Updated March 2009)
Fannie Mae Training Video
Note: This video was made immediately after the 1004MC was introduced. It does not reflect the change made by Fannie Mae with regard to the reporting of listing for each time period.