Part B. Design, Location, Condition (lines 6 through 10)

This section allows for comparison of the comparable to the subject in terms of design, materials, condition, location, and appeal. The total adjustments in this section should not exceed the value a typical tenant would place on these characteristics in the aggregate.

Line 6. Structure/ Stories. The RCS appraiser must enter the type of structure using recognized codes such as “E” for Elevator, “G” for Garden, “WU” for other walk-up, and “T” for townhouse. The RCS appraiser can select other categories as dictated by market conditions, but must explain the significance of other categories and codes, if different from the recognized codes. For example, in some markets, renters in low-rise buildings may value apartments with private exterior entrances over a shared entry/or shared stairway, even if the units are stacked. In such cases, the RCS appraiser must identify the categories and codes used in the adjustments. Codes such as “WU-Pvt” (private entrance) or “WU-Shrd” (shared entrance) could be used.

The RCS appraiser must follow the letters with a slant bar and the number of stories. For example, the RCS appraiser should enter “WU/3” for a three-story walk-up. The RCS appraiser should try to select comparables that have the same structure type as the subject. If the comparables have a different configuration than the subject, adjustment may be warranted based on market preferences. For instance, the RCS appraiser may make an adjustment for configuration differences such as townhome versus a stacked unit. The RCS appraiser must explain the basis for any adjustment exceeding the larger of $10 or 2 percent of the comparable’s unadjusted rent.

Line 7. Year built/Year renovated. The RCS appraiser must enter the year the project was built. If it has been renovated, the RCS appraiser should follow with a slant bar and the year the project was renovated. For example, 1939/70 would indicate that the project was built in 1939 and renovated in 1970. The RCS appraiser must make adjustments on this line if the effective age (the age indicated by the utility, quality of the structure, and major equipment) affects rental value. The RCS appraiser must consider if basic structures and major equipment have been replaced and whether baths and kitchens have been renovated. Typically, the RCS appraiser should not make any adjustments for age differences of just a few years. When the RCS appraiser chooses to make an adjustment, the amount for each year of age difference should typically be less than $5 per year or 1 percent of the unadjusted rent. Alternatively, the RCS appraiser could make one adjustment for multiples of a fixed number of years of age difference. For example , each multiple of three years of age difference between the subject and the comparable would be assigned a certain dollar amount of adjustment.

6

Appendix 9-1-1 – Published March 2023

Line 8. Condition/Street Appeal. It is mandatory for the RCS appraiser to rate the subject and each comparable per a five-point scale: Excellent, Good, Average, Fair, or Poor. No other classifications are acceptable. For the subject, and every comparable, the RCS appraiser must enter “E” for excellent, “G” for good, “A” for average, “F” for fair, or “P” for poor. If the design of the building or the street appeal of the project would affect the rents it can command, the RCS appraiser must adjust appropriately. The RCS appraiser should consider the overall appearance of the project, such as whether the grounds are clean, whether the landscaping is well maintained, and whether or not the paint and siding are in good condition. Other considerations would be whether the architecture of the buildings and layout of the site are appealing (open space, shrubbery, etc.). In summary, the RCS appraiser must evaluate whether the comparable’s condition/street appeal could cause tenants to pay more or less than they would pay at the subject.

An adjustment of more than the larger of $20 or 4 percent of unadjusted rent for each level of rating difference would require that the RCS appraiser provide specific explanation in the narrative to support the amount of adjustment. Example: a positive adjustment for an “Average” rated comparable versus an “Excellent” rated subject, should not exceed $40, or 8 percent of the unadjusted comparable rent, whichever is larger.

Due to the potential for overlap between adjustment parameters, if the RCS appraiser has made an adjustment on Line 7 for Year Built/Renovated for a comparable, the RCS appraiser must explain if the adjustment exceeds $15 or 3 percent of unadjusted rent, whichever is larger, for each level of rating difference for Line 8 for that same comparable.

Note: Take care not to duplicate adjustments made on line 7. Adjustments made on lines 7 and 8 should not add to more than the adjustment that would be made if the project characteristics referenced on Lines 7 and 8 were considered as a single adjustment.

Line 9. Neighborhood. The RCS appraiser must rate the subject and each comparable according to a five-point scale: Excellent, Good, Average, Fair, or Poor. No other classifications are acceptable. For the subject, and every comparable, the RCS appraiser must enter “E” for excellent, “G” for good, “A” for average, “F” for fair, or “P” for poor. The entry should reflect the market’s reaction to location features that affect rental values. For example, neighborhood desirability; nuisances such as street noise; nearby land uses; crime volume; and access (time/distance) to schools, transportation, shopping, recreation, and medical and employment centers. The Multifamily Assisted Housing Reform and Affordability Act of 1997 (MAHRA) specifically requires that neighborhood (including risk of crime), location and access be considered.

s. For example, neighborhood desirability; nuisances such as street noise; nearby land uses; crime volume; and access (time/distance) to schools, transportation, shopping, recreation, and medical and employment centers. The Multifamily Assisted Housing Reform and Affordability Act of 1997 (MAHRA) specifically requires that neighborhood (including risk of crime), location and access be considered.

An adjustment of more than $20 or 4 percent of unadjusted rent, whichever is larger, for each level of rating difference would require that the RCS appraiser provide specific explanation in the narrative to support the amount of adjustment. For example , a positive adjustment for an “Average” rated comparable versus an “Excellent” rated subject, should not exceed $40, or 8 percent of the unadjusted comparable rate, whichever is larger.

Appendix 9-1-1 – Published March 2023

7

The RCS appraiser must note that the Fair Housing Act prohibits appraisers from discriminating in appraisals, such as making adjustments because of the race, color, religion, sex (including sexual orientation and gender identity), disability, familial status, or national origin of the residents of projects or the surrounding areas. RCS appraiser’s adjustments must be based on objective, quantifiable, and nondiscriminatory factors.

Line 10. Same Market? Miles to Subject? The RCS appraiser must enter “Y” or “N”, depending on whether the comparable is in the same market area as the subject. The RCS appraiser must follow the entry with a slant bar, and the distance between the comparable and the subject in miles. If the comparable is in a different market area, the RCS appraiser must collect quantitative data to compare the rent levels in the two market areas. The RCS appraiser must adjust for any significant difference in rental costs between the two market areas and explain how he/she computed the adjustment. If the comparable is in a different market area and the RCS appraiser chooses to not adjust it for the different market location, the RCS appraiser must explain why .