Technology or Human Logical Analysis? Who Wins?

By George Dell, MAI, SRA, ASA, CDEI
Excerpt: There is evidence that human judgment WINS – the appraiser opinion beats the AVM and other valuations based on technology. In fact, I have often heard that the qualified appraisal, based on the human logical analysis – is the “gold standard” for the industry. This appears to be true of client groups, and appears to be recognized in administrative law, our federal and state and “quasi-governmental” bodies such as Fannie Mae, Freddie Mac, and the Appraisal Foundation.

Even as we say this, the human model, the appraiser, continues to lose market share to other technologies and other “non-appraiser” value providers.

Worth reading at:

My comment: George Dell’s weekly blog posts are great, but short, as is appropriate for blogs. The May issue of the paid Appraisal Today newsletter will have a much longer article by George, “Will another profession replace appraisers?”

Uredd Rest Area (Ureddplassen)

Norway has built what may be the world’s most beautiful public toilet.

Just For Fun!!

Excerpt: Norway’s newest landmark is a place of absurd beauty. The redesigned rest area, situated along a section of the Norwegian Scenic Route, overlooks stunning views of the fjords and the open sea, and is a popular spot for visitors and locals to watch the northern lights in winter and the midnight sun in summer.

Now this picturesque place is quickly gaining a stranger kind of fame, for being home to what may be the most beautiful public toilet the world over.

Check out the Fantastic Photos and short description at:

My comment: Wow!! What do I use in the field? Fast food, bushes, etc. ;> Sometimes a crummy restroom or smelly portable toilet in a public park… Please hit reply of you know any other great public restrooms…

FHA increases loan limits in nearly every area of U.S. for 2018

More than 3,000 counties to see increases
Excerpts: Back in 2016, the FHA increased loan limits for just 188 counties. Then, in 2017, this number jumped to 2,948 counties that saw an increase. And now, the number of counties increased even further to 3,011 counties for 2018.

In high-cost areas, the FHA’s loan limit ceiling will increase to $679,650, up from $636,150 this year. The floor will also increase from $275,665 to $294,515 in 2018.

However, in 223 counties, the FHA loan limits will remain the same.

Housing Knife Fights! 10 Surprising Cities Where Bidding Wars Are Booming

Excerpts: “Multiple-offer scenarios are no longer reserved to the usual big, fast-moving markets,” says Javier Vivas, director of economic research for “Demand for homes has spilled outward into secondary, smaller markets, and more buyers are gearing up to face fierce competition in more places around the country.”

A few of the lowest price cities:
1. Akron, OH
Median home list price: $150,000
Share of homes selling above list price*: 20.6%
Increase in the share of homes selling over list price: 91.7%

10. Little Rock, AR
Median home list price: $176,100
Share of homes selling above list price: 13.5%
Increase in the share of homes selling over list price: 67.5%

My comment: Wow!! I had been hearing about this on lower priced homes, but did not have any good data. In the immediate Bay Area, median just hit $850,000. Not on the list ;> Of course, if you want a 3 hour commute to Stockton or Modesto, prices are mid-$200,000s.
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Want to do appraisals for lenders, but not for AMCs? Private money lending – no UAD or CE, computer “reviewers”, or being treated like you know nothing!!

in the paid Appraisal Today

Excerpt: Many appraisers don’t want to do non-lender work such as divorces. It is hard to get started and you may
have to testify in court. There is another lender option – hard money lenders. I know only a few appraisers who work for them. I don’t know why, especially since AMCs, who are not good clients, took over conventional lender appraisals.
The appraisals are similar to what you used to do for mortgage brokers. The marketing is similar also, personal relationships. 
My article also discusses:
– How they differ from conventional loans.
– Who does these loans.
– No Fannie Mae guidelines, only USPAP.
– Fees are good – no competitive bidding.
– No reviewers, human or computer.
In the November issue of the paid Appraisal Today, available to paid subscribers.  
To read the full article, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
If this article got you one appraisal, it is worth the much more than the subscription price!! 

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or $99 per year or $169 for two years 
Subscribers get, FREE: past 18+ months of past newsletters 
To purchase the paid Appraisal Today newsletter go to   or call 800-839-0227. 
If you are a paid subscriber and did not get the April 2018 issue, emailed Monday, April 2, 2018, please send an email to  and we will send it to you!! Or, hit the reply button. Be sure to put in a comment requesting it.

Fannie Mae Appraiser Update: New Contact Us form, appraisal modernization, Rural Round Up, and more

What does “appraisal modernization” mean to you? The latest Fannie Mae Appraiser Update explores this hot topic, in addition to recent changes to the Appraiser Qualifications Criteria and to Fannie Mae appraisal policies. Learn more about the Appraiser Quality Monitoring (AQM) process in the AQM Update and get tips on appraising properties with agricultural attributes in our Rural Round Up.

Our April 2018 issue also introduces the new Contact Us form for appraisers. We view engagement and collaboration with appraisers as essential to our success at Fannie Mae and to the housing industry as a whole. Use this form to share what’s on your mind and to submit feedback and questions on appraisal topics.

My comment: 4 pages and easy to read. The May issue of the paid Appraisal Today will have two articles on CU and will discuss, in much more detail, Messaging stats, Risk Scores, and lots more topics. Plus an article on Risk Score Manipulation by an appraiser with personal experience on this issue.

Link to Fannie contact form:  
Appraisers take issue with Fannie Mae’s Collateral Underwriter
But several mortgage lender benefits to using this tool

Excerpts: One thing I’ve noticed lately is appraisers are firing back against Fannie Mae’s Collateral Underwriter… But…what are the mortgage lender benefits of using this tool?… Appraisers seem to have a good case for responding this way and they need to be heard.

Good analysis of all the issues. No comments as of April 25.

FHFA Working Paper Credibility Questioned:

“Are Appraisal Management Companies Value-Adding?-Stylized Facts from AMC and Non-AMC appraisals”
Note: FHFA is the GSEs regulator

Brief excerpts from a long, detailed letter sent by Michael F. Ford of the American Guild of Appraisers to FHFA: “We have identified numerous errors or weaknesses in the analyses presented that respectfully result in fatal flaws that are so significant as to undermine the entire papers credibility”….

“The WP cites empirical studies as having shown that “property appraisals tend to be biased upwards, and over 90% of the time either confirm or exceed the contract price.” The first part of that statement (upward bias) has absolutely no support or relationship to or from the end of the sentence. “

Click here to read the letter and the original working paper

ASC denies Tristar Bank waiver request April 23, 2017

Previously from this newsletter: 21 appraisal groups submitted on Feb. 13 a letter to the Appraisal Subcommittee asking them to reject TriStar Bank’s request. An expanded, 25-member coalition submitted on April 9 an additional letter to the Appraisal Subcommittee reiterating their opposition to the appraisal waiver request from TriStar Bank. The letter again refuted bank claims of an appraiser shortage, and stated that granting the waiver would undermine safety and soundness of the transactions.

Brief summary article from McKissock
In what can only be viewed as a victory for the appraisal community, the Appraisal Subcommittee (ASC) voted at its April 23, 2018 meeting to deny the request of TriStar Bank for a waiver from the federal regulatory requirement to utilize a licensed or certified appraiser for appraisals performed in certain counties in the Nashville, Tennessee area.


Brief summary from the Appraisal institute
Excerpt: During deliberations, several ASC board members questioned the supporting documentation provided by the bank, including information on purported increases in turnaround times. The board did not see the nominal increased turnaround time as representing a scarcity of appraisers, especially considering comments submitted by local appraisers who had worked for the bank.
The ASC board offered to provide TriStar Bank with the names of local appraisers who expressed interest in working with the bank during the open comment period as the bank attempts to resolve ongoing operational issues.
Link to bank’s request, Federal Register notice, dated March 3, 2017

Nuclear Option DENIED! –
Note: Tristar is at the top of the long commentary. Has some details, such as who was there. Includes other topics – LREAB, Corelogic and a la mode, etc. Link to the 98 comments submitted to the FTC about Corelogic purchase. Unfortunately they were done after the purchase but worth reading. State Coalitions sent out messages to other appraisers to speak out. Social Media, including email lists, works!!

Excerpt: With all of the information the board concluded that there was not an appraiser shortage and that there was not an unacceptable increase and turn times given market conditions. The board members then voted unanimously to deny appraisal waivers but did offer to act as an intermediary to assist the bank in finding qualified, state certified appraisers.

My comment: I was unable to verify who said what at the meeting, and who was there, by my deadline.
HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to 
Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample issue go to or send an email to . Or call 800-839-0227, MTW 7AM to noon, Pacific time.

Mortgage applications decreased 0.2 percent from one week earlier

WASHINGTON, D.C. (April 25, 2018) – Mortgage applications decreased 0.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 20, 2018.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1 percent compared with the previous week. The Refinance Index decreased 0.3 percent from the previous week. The seasonally adjusted Purchase Index was unchanged from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 11 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 37.2 percent of total applications, the lowest level since September 2008, from 37.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.5 percent of total applications.

The FHA share of total applications decreased to 10.2 percent from 10.6 percent the week prior. The VA share of total applications decreased to 10.1 percent from 10.4 percent the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) increased to its highest level since September 2013, 4.73 percent, from 4.66 percent, with points increasing to 0.49 from 0.46 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) increased to its highest level since January 2014, 4.64 percent, from 4.53 percent, with points increasing to 0.39 from 0.38 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.71 percent from 4.70 percent, with points increasing to 0.79 from 0.53 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to its highest level since April 2011, 4.13 percent, from 4.08 percent, with points increasing to 0.52 from 0.47 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs increased to its highest level since February 2011, 3.98 percent, from 3.94 percent, with points increasing to 0.44 from 0.43 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please, contact or click here.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.

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