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Cost Approach -- FHA |
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Cost Approach -- FHA |
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Question: I am working on an FHA appraisal for new house. I recently took the McKissock course on FHA and was told that the cost approach IS NOT required on new construction UNLESS it is a new manufactured home or the client requests the cost approach. So, is it true that I do not need to do the cost approach now for FHA?
Answer: McKissock is correct.
Quote:
Page 35, Section 9 of Appendix D -- . . . the appraiser may complete the Cost Approach; however, it is not required for an FHA appraisal. If, however, the subject is a unique property, has specialized improvements, is manufactured housing, or the client requests the Cost Approach be completed, then the Cost Approach is required and must be completed. |
Make sure to explain the omission of the cost approach as a part of you SOW as required by the USPAP.
Additionally, you must understand that if the client requests the cost approach, it is required.
Updated -- 7/23/2008
Page url: http://www.georgiaappraiser.com/everythingappraisal/?fha_cost_approach.htm
