With few new people currently entering the appraisal profession, do you foresee a shortage of appraisers at some point?
Yes, in the next few years. 2,705 votes 47%
Yes, but it’s probably years down the road. 1,603 votes 28%
No, I don’t think we will see a chronic shortage. 1,137 votes 20%
Not sure. 253 votes 4%
Total Votes: 5,698
Until appraiser licensing 20 years ago, most residential appraisers worked for lenders. When it was busy they hired armies of trainees. When work slowed down many were laid off. With the cyclical fees in AMC work and many lenders not allowing trainees to sign appraisals, it is not financially feasible for fee appraisers to train.
I assume that lenders will allow trainees to sign at some time as the inevitable cycle of weak vs. strong regulations shift. I have no idea when this will happen. This is the easiest way to fix the problem. Low AMC fees when business is slow is more complicated as it reduces the financial incentive for fee appraisers to hire trainees and give them part of the fee.
I am interested in the comment
“I assume that lenders will allow trainees to sign at some time as the inevitable cycle of weak vs. strong regulations shift. I have no idea when this will happen. ”
As a former (still Certified, but inactive) part time California Certified Residential appraiser, let me say this.
Unless it is 100% legislated that trainees be allowed to inspect AND sign alone, no lender (or reseller of mortgages) will ever let a trainee be alone on an appraisal.
The biggest issue (in my humble opinion) that has been under the radar for years is that so many appraisal shops will send out “ghost appraisers”. Nobody can expect 2 people (appraiser and trainee) to hang out for 2 years and travel together and sign together. Just NEVER happens. NEVER. At least not for a full 2 years.
“Ghost” appraising is basically where the guy (or lady of course) signing as a full appraiser, sends out a trainee, many times completely unlicensed, to perform a flat fee inspection, maybe $50 per house to inspect. They lead the ghosts into it by claiming they will help them get experience in order to get their own license after 2 years or so.
The signing appraiser does not even visit the house. (HOMEOWNERS, ASK FOR VALID PICTURE ID)
The main signing appraiser then has his low paid office staff help put together the appraisal by grabbing comps and pictures off the internet (MLS, street view, etc).
This is how you end up with garbage appraisals.
It is also completely outside the limits of normal assistance with writing up an appraisal report. The appraiser signing “inspected”, MUST INSPECT the property and view and choose the comps, etc.
The finished report goes to the lender (via the AMC) with no reference to the trainee, with the main licensed guy being the only signature showing on the report. This is common. Very common. That is the only way fees are kept so low. By cutting corners.
In todays market, the appraiser willing to submit the lowest bid for work, combined somewhat with the lowest ethical cutoff of what they are willing to do wrong to squeak an extra buck out, is unfortunately todays winner in the reverse bid AMC residential contract appraiser market.
I won’t participate in this kind of market, and have chosen to step back, keep my license active, and hope things improve later. I won’t sacrifice my morals / ethics.
AS I SIT AND THINK ABOUT THIS. THE END SOLUTION IS THAT ALL APPRAISERS WILL HAVE TO BE HIRED AND TRAINED BY EITHER COMMERCIAL APPRAISERS WITH BIG OFFICES AND PULL, OR MOST LIKELY BE HIRED BY THE NEW EVOLUTION OF THE BANK ORDERING SYSTEM, JUST CALLED THE BIG AMC NOW.
Independent contract residential appraising seems to be heading out the door now.
Which seems somewhat ironic to me, since the whole original intent of creating these AMC’s was to separate the appraiser from the influence of the bank.
INSTEAD A LARGE OLIGOPOLY OF AMC’s OWNED BY THE BANKS HAS BEEN FORMED, that clearly dominate and influence the market in just as bad, if not far worse ways than before, when we had hundreds of thousands of independent brokers and agents keeping the system (and pay) closer to a fair market ordering system.
Just one mans humble opinion, I understand some may have different opinion, or maybe be in a better market with a better experience. In California we appear to be overwhelmed with appraisers, and the extremely low fees and the garbage quality that many times goes hand in hand.