Appraisal News and Business Tips

7-12-19 ASC Approves ND Waiver – Neighborhood Names – 27 Inspiring Bridges

How much is a neighborhood name worth?

Excerpt: Despite some anecdotal examples, there’s little statistical evidence supporting the notion that a neighborhood’s brand or name contributes to a higher sales volume or a premium on price, according to Jonathan Miller, chief executive of the appraisal firm Miller Samuel.

“You’ll see buildings trying to hook into adjacent, better-known neighborhoods as a marketing ploy, but we don’t see that translate into a premium or more sales for doing that,” Mr. Miller said.

To read more, click here

My comment: Some interesting stories. I’m not sure if “renaming” works, but I do know that in some older established neighborhoods in the Bay Area, including my city, the name does make a difference in value.

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Come Together

By Richard Hagar, SRA

Excerpt: The typical contrarian appraiser, in the often false belief that they can make more money on their own, avoid “fee splitting” by setting up a one-man shop, usually right after obtaining a State Certification. In other words, they set themselves up to be isolated prey to the wolves of the lending world.

Poorly run AMCs, in their quest to make more and more profits, look for, if not require, appraisers who are isolated from others. Isolated appraisers are easier to manipulate into accepting lower fees, easier to intimidate into providing lightening quick and often sloppy appraisals and easier to convince into accepting odd “requirements” that help the lender, even if they are not USPAP compliant. Some of these poorly run AMCs don’t worry if something goes wrong with the loan because they will simply blame the appraiser. In other words, when the bank wants someone to shoot, the AMC will duck out of sight and we all know whom the bullet often finds.

To read more, click here

My comment: When I started my appraisal business, working out of my home, I realized within 2 months that I hated clerical work. I had never worked in an office doing clerical work. I hired an assistant who I trained as an appraiser. Over time, I downsized and did not have any other appraisers in my office, but have always had an office assistant and never worked at home. I developed a network of other appraisers to call. But, I really missed having appraisers in my office.

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Dude, my house is worth more now, right? Because of that one thing.

By Ryan Lundquist

Excerpt: My house is worth more now, right? Or maybe it’s worth less because of that one thing? I get questions like this all the time, so here’s some thoughts swirling through my mind. Skim the headings or dig in. Anything to add?

Here are a few of the questions:

Will prices rise because a nearby restaurant got a Michelin Star?

A new Starbucks down the street makes value go up, right?

Will it damage neighborhood values if there’s a cannabis facility nearby?

Will a new gas station impact neighborhood prices?

For more questions and some ideas click here

My comment: I get these questions also, as do many appraisers. I wish I had a good answer ;> FYI, one of my favorite movies is The Big Lebowski, starring Jeff Bridges as “The Dude”.

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27 Inspiring Bridges That Are Worth Going Out of Your Way to Cross Just For Fun!!!

Excerpt: Let’s be thankful that the world (and life, amirite?) is full of valleys, chasms, rivers, and streams that need to be crossed, because otherwise we wouldn’t have so many incredible bridges. From towering railway spans to crumbling historic foot crossings, bridges manage to be both awe-inspiring monuments to human ingenuity and essential geographic connections.

Bridges from all over the world, with photos and brief comments. The photo above is from Big Sur CA. I have driven over it many times. Incredible!!

To read more, click here

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Getting too many ad-only emails?

Click here for the list of 4 ways plus information on why I take ads, etc.

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Lots of ways to cut costs, and increase profits
and cash flow in your appraisal business!

Excerpt: Here are a few ideas:

Software

  • Do you really need an expensive support contract? How often do you call support? I never buy support contracts. I seldom call and am willing to pay the fee, usually around $50 to $100 per call. A lot cheaper than a contract.
  • Are you using all the “bells and whistles” that cost extra? Do you need all of them?

Fees

  • Dump high hassle, low pay clients as soon as you can, so you will have time to get new clients.
  • Don’t offer lower prices to a client that isn’t price sensitive. Why give away your profits? Not everyone gives assignments to the low bidder. Some don’t even do competitive bidding.

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ASC OKs North Dakota Request for Temporary Appraisal Waiver

Source: Appraisal Institute Appraiser News Online

Excerpt: The Appraisal Subcommittee on July 9 granted a request from North Dakota for a temporary waiver from appraisal licensing requirements after state officials claimed a scarcity of appraisers. The ASC granted the one-year waiver from licensing requirements by a 5-2 vote; an additional year is possible if state officials again seek a waiver based on the scarcity argument.

For more info, click here

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A few preliminary comments from Dave Towne

(from appraiser email discussion groups):

What does this mean?

A- It does not apply to ‘all’ appraisals.

B- It applies to portfolio (in-house) loans granted by lenders, NOT to loans which eventually will be re-sold to the GSE’s or other agencies – which will require a fully compliant appraisal signed by a licensed appraiser.

C- The ND ‘waiver’ appraisals still must comply with USPAP, but the appraisal does not need to be signed by a licensed/certified appraiser. (I’m still trying to wrap my head around this aspect.) I guess this means the lender can use people who do their EVALAUTION reports – who don’t comply with USPAP, but will have to with these ‘waiver’ assignments.

D- These ‘waiver’ appraisals apply to only residential properties.

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LastPass, KeePass, and Other Password Managers for Appraisers

Excerpt: Cybersecurity is critical nowadays, especially for appraisers. Strong passwords help protect both your personal info and the large amount of real estate property info you handle on the job. However, it can be difficult to remember long, complicated passwords for all your different web logins. Password managers like LastPass and KeePass allow you to save all your passwords in one place. So you can easily log into databases, web portals, and any other websites you use during an appraisal—while keeping sensitive information protected from hackers.

To read more, click here

My comment: My email was hacked several months ago by using my password, which I used way too often. My tech guys fixed it by the next day and found the password in a lot of online databases…. Yes, I changed it!! My local bank finally started requiring a more complex password recently.

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Rent Control Used to Work – During Wartime

It isn’t designed to redress today’s shortage of affordable housing.

By Stephen Mihm. Bloomberg opinion article

Excerpt: The debate today is framed as a philosophical disagreement about the relative merits of free markets and state regulation. But that obscures the real reason rent control was ever tried in the first place: war.

The first recorded instances of rent control date to the 16th century, when a wartime siege of Paris and other cities prompted the courts to reduce or even abolish rents. Other nations adopted similar measures when war disrupted the ebb and flow of commerce.

These measures were always temporary, though. That changed in 1914, when the “war to end all wars” got underway, rupturing housing markets in all participating countries. People poured into cities to work in war industries at the very same time that new construction slowed to a halt for want of building materials and construction workers.

Good analysis of the history of rent control, starting hundreds of years ago in Europe!

To read more, click here

My comment: In my small city, last week the city council voted to increase rent control by approving very strict methods. It is Very Bad. I own rental property . I have appraised a lot of apartment properties in nearby rent controlled cities. It did not bother me until I was personally affected.

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Mortgage applications decreased 2.4 percent from one week earlier

WASHINGTON, D.C. (July 10, 2019) – Mortgage applications decreased 2.4 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 5, 2019. This week’s results include an adjustment for the Fourth of July holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 2.4 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 22 percent compared with the previous week. The Refinance Index decreased 7 percent from the previous week and was 88 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index decreased 18 percent compared with the previous week and was 6 percent higher than the same week one year ago.

“Mortgage applications were down slightly, even after adjusting for the July 4th holiday, as we saw opposing moves in purchase and refinance applications over the week. Purchase applications increased from the previous week and were up 5 percent from a year ago, a continuation of the strong annual growth that we saw in the first half of 2019. Refinance activity decreased over 6 percent and the refinance share of applications fell back below 50 percent, even as the 30-year, fixed-rate declined 3 basis points to 4.04 percent,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Borrowers have been less sensitive to low rates as many borrowers have either recently refinanced or are likely waiting for rates to fall even further. Other mortgage rates in our survey were unchanged or slightly higher than in the previous week.”

The refinance share of mortgage activity decreased to 48.7 percent of total applications from 51.0 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 5.3 percent of total applications.

The FHA share of total applications remained unchanged from 10.1 percent the week prior. The VA share of total applications increased to 13.2 percent from 12.8 percent the week prior. The USDA share of total applications increased to 0.7 percent from 0.6 percent the week prior.

The average contract interest rate for 30-year, fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.04 percent from 4.07 percent, with points increasing to 0.37 from 0.36 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year, fixed-rate mortgages with jumbo loan balances (greater than $484,350) increased to 4.03 percent from 4.00 percent, with points increasing to 0.27 from 0.25 (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 remained unchanged at 3.97 percent, with points remaining unchanged at 0.30 (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 remained unchanged at 3.42 percent, with points remaining unchanged at 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 5/1 ARMs increased to 3.56 percent from 3.46 percent, with points increasing to 0.28 from 0.26 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

If you would like to purchase a subscription to MBA’s Weekly Applications Survey, please visit www.mba.org/WeeklyApps, contact mbaresearch@mba.org 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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Ann O’Rourke, MAI, SRA, MBA

Appraiser and Publisher Appraisal Today

2033 Clement Ave. Suite 105, Alameda, CA 94501

Phone 510-865-8041 | Fax 510-523-1138

Email  ann@appraisaltoday.com

www.appraisaltoday.com

1 Comment
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