Knowledge Base

Appraise-It Pro: Adjustments Sensitivity Analysis Tool

Direct Video Link:

Sensitivity Analysis is based on the theory that as the adjustment rates become more appropriate, the indicated (adjusted) values should begin to converge. If $490,000 is the well supported adjusted price, they won't all adjust out to be be exactly $490,000. There will be some variance, but they will begin to converge.

Appraise-It Pro’s Adjustments Sensitivity Analysis Tool helps you visualize this and make adjustments quickly and easily to get closer to this perfection.

In the tool, this is shown using a line graph. Each adjusted property value is plotted on the chart and a line shows the difference in value between all of them. As the adjusted sale prices of the properties become more perfect, the lines on the graphs will collectively even out and become more flat.

Once you have entered all of your comparable and listing data and have made your initial adjustments in the report, go to the Tools menu in Appraise-It Pro and select Adjustments Sensitivity Analysis.

Your adjustment categories will be shown and plotted on a graph with the Adjusted Sale Price in the Y vertical axis and the Difference from Subject in the X horizontal axis.

You can also select which comparable types you wish to include in the analysis using this pulldown menu in the upper left of the program.

The aim is to refine your adjustments to get the lines in each individual graph and all the graphs as a group as even and flat as possible. By doing this, you will get your adjustments close to perfection.

Select an adjustment category from the selection of graphs on the left to show a larger version of it on the right.

If you mouse over a plot point on the graph, it’ll show you which address it represents along with a thumbnail image of the front view.

In the lower left, select the comp type you wish to modify and change the adjustment using the plus or minus 10% or 100 buttons and keep adjusting it until you get the graph lines as flat as possible.

Keep in mind, as you adjust one adjustment category, the others will also change. It’s a delicate balancing act.

If you wish to include any of the graphs in your report on a new Sensitivity Analysis Charts addendum, check their check box in the upper-left corner of the graph thumbnail or currently selected graph. This is optional, however.

In real-life situations, there are few cases where all adjustment rates can be 100% on-target resulting in perfectly flat lines in the graphs. The analysis will be most effective when the existing adjustments you start with are already close and realistic. Therefore, this method is not infallible and should not be overly relied upon. Proper technique would be to change each rate you are uncertain about a small amount then move to another. The line slopes only makes a sensitivity analysis easier and faster to perform. It doesn’t make it any more reliable.

When you get all graphs as even as possible and you’re happy with the results, click the Transfer and Close button in the lower-right corner.

Your updated adjustments will now be applied to your comps and listings overwriting your original values and the Sensitivity Analysis Charts addendum will be added if you selected to include any of the graphs.


Print this article Print this page
Search Again

Article Details

Last Updated
February 11, 2022