Beyond Forms: Appraising Atypical Properties with the UAD 3.6 Dynamic URAR

Hey fellow appraisers, John Anderson here. We've all been navigating the waves of change hitting our industry, particularly with the rollout of the Uniform Appraisal Dataset (UAD) 3.6 and the related Uniform Property Dataset (UPD) initiatives from Fannie Mae and Freddie Mac. One of the most significant shifts is the move away from the traditional numbered forms we've used for decades.

Instead of selecting a specific form like the 1004 or 1073, the new Uniform Residential Appraisal Report (URAR) is designed to be dynamic. Its structure adapts based on the specific characteristics of the property being appraised. This is a big step towards standardization and better data quality, but it naturally raises questions, especially when dealing with properties that didn't neatly fit into the old boxes. Today, I want to focus on how this new system handles these "atypical" properties.

The Constraints of Legacy Forms

Let's be honest, the old system had its limitations. Trying to fit certain property types into predefined forms often felt like forcing a square peg into a round hole. Think about:

• Site Condominiums (Detached Condos): Often appraised on a standard single-family form, but requiring specific condo considerations.
• Properties with Multiple Accessory Dwelling Units (ADUs): The standard forms weren't built to handle more than one ADU gracefully.
• Manufactured Homes with Unique Setups: Such as those with more than one unit, or those classified as condominiums or cooperatives.
• Condops: A hybrid legal structure that didn't have its own dedicated form.

These situations frequently required extensive commentary and addenda to adequately describe the property and provide the necessary analysis, sometimes leading to inconsistencies or reviewer confusion. The retirement of numerous legacy forms under UAD 3.6 aims to address this directly.

The Dynamic URAR: Driven by Data, Not Form Numbers

The core principle behind the new URAR is that data drives the report. Instead of a form number dictating the content, specific data points collected during the appraisal process determine which sections and fields are relevant and how the final report is structured.

Based on the GSE guidance, particularly the "Functioning without Form Numbers" document, six key UAD data points are crucial in shaping the report for a specific property type:

1. Property Valuation Method: (e.g., Traditional, Hybrid, Desktop, Exterior Only)
2. Construction Method: (e.g., Site Built, Manufactured, Modular, 3D Printed)
3. Subject Site Owned in Common: (Yes/No - crucial for condos/co-ops)
4. Project Legal Structure: (e.g., Condo, Co-op, PUD, None)
5. Units Excluding ADUs: (The number of primary living units)
6. Accessory Dwelling Units: (The total count of ADUs)

When you input these characteristics, the system dynamically generates the appropriate URAR sections.

How UAD 3.6 Accommodates Atypical Properties

This data-driven approach means the new URAR is inherently flexible and can accommodate those previously challenging property types much more effectively:

• Site Condominiums: By selecting "Site Built" (or other appropriate Construction Method), indicating "Condominium" for Project Legal Structure, and "Yes" for Subject Site Owned in Common, the report will correctly reflect this property type without needing a workaround.
• Properties with >1 ADU: The dedicated "Accessory Dwelling Units" data point allows for specifying the exact number (0, 1, or more), triggering the necessary report sections to detail these units properly.
• Manufactured Homes (Complex Scenarios): Whether it's a multi-unit manufactured home, one within a PUD, or one legally structured as a condo or co-op, combining the "Manufactured" Construction Method with the correct inputs for Units, ADUs, Project Legal Structure, and Site Ownership generates the appropriate report format.
• Condops: Can be represented by selecting "Cooperative" for the Project Legal Structure and indicating the specific characteristics that define it as a Condop, likely involving details about ownership and common elements.

This eliminates the ambiguity and reliance on addenda that plagued the legacy system for these property types. The goal is a clearer, more consistent report regardless of the property's specific configuration.

Benefits for Appraisers

This transition isn't just about new rules; it offers tangible benefits:

• Increased Clarity: A single, adaptable report structure reduces confusion about which "form" to use.
• Improved Consistency: Standardized data points lead to more uniform reports across the industry.
• Reduced Workarounds: Less need for extensive narrative explanations in addenda for atypical properties, as the dynamic structure accommodates them directly.
• Better Data Representation: The final report more accurately reflects the unique characteristics of the property.

This shift towards discrete data points feeding a dynamic report structure is where technology can really help. Tools designed for the modern appraisal workflow can streamline the collection of these critical data points during inspection and help ensure the report structure automatically reflects the property's characteristics, aligning perfectly with the flexibility UAD 3.6 offers.

Moving Forward

The move to UAD 3.6 and the dynamic URAR represents a significant modernization effort. While change always involves a learning curve, the ability to more accurately and consistently report on all residential property types, including those previously considered atypical, is a major step forward. Familiarizing yourself now with these key data points and how they influence the report structure will be crucial for a smooth transition. Keep an eye on the resources provided by the GSEs, including the detailed mapping documents and training materials, as we move closer to the implementation deadlines.