The Most Challenging Part of the Appraisal Process

Appraisal Process Challenges
Excerpts: Number 1: Data analysis (34%)

“When comps are limited, or when sales prices vary by as much as 50% for what appear to be very similar properties in the same neighborhood (which seems to be more and more common in the Denver metro area), selecting the best comparable properties can be a very time consuming and stressful process.”

Number 2. Site value opinion (17%)

“I choose ‘Site Value Opinion’ as the most challenging since there are very few vacant land sales in the areas that I appraise in. With very few sales, it’s very difficult to provide an opinion of value for many sites.”

To read more comments from appraisers and the other 7 challenging parts of the appraisal process click here

My comment: Lots of good appraiser comments. Data Analysis is my number one choice also. Tract homes are sorta boring but can be a welcome break from all the non-tract homes I appraise. Also, with Covid, I don’t connect with real estate agents every week at open houses to find out what is happening (behind the data).

Appraising Weird Stuff is Challenging!(Opens in a new browser tab)

Common Appraiser Violations(Opens in a new browser tab)

What to Do When Your Appraisal Is Under Review(Opens in a new browser tab)


Scroll down the page to read about house with 11 connected domes, foreclosure crisis, mortgage lending, independent contractors, racial bias controversy, increasing profits, covid-19, etc. 

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11 connected Domes in Australian house!!

Just For Fun! What We All Need!!!

Excerpt: With 11 domes and twenty rooms across 1,050-square metres (10,925 sq.ft.) of floor space, this house, or spaceship, is a “world first”.

It’s situated on half a hectare (0.74 acres), with multiple balconies and a wine cellar.

To see lots of very interesting photos click here

My comment: I tried to count the domes myself but gave up! I have never seen, or heard of, a house with this many connected domes. I definitely would need to use a builder or architect drawing!! I would go crazee trying to measure this house…..




California Legislation Clarifies Status of Appraisers as Independent Contractors

Excerpt: California Gov. Gavin Newsom on Sept. 4 signed AB 2257, legislation that clarifies how the state’s employment laws apply to services provided by state-licensed and state-certified real estate appraisers, allowing them to work as independent contractors.

To read lots more, plus a link to the Law, click here

My comments: The Appraisal Institute’s California legislative group has used lobbyist Michael Belote for many years. I remember complaining about the cost of hiring him. This new law was worth every penny!! Without a lobbyist, there is not much hope for a small profession similar to appraisers. My first article on Independent contractors for appraisers was written in 1992. I wrote about this new law in my paid newsletter. Including appraisers in this law may have been able to be used as a “precedent” in other states. The reason for the law was Uber and Lyft using driver Independent Contractors.

Per Peter Christensen who has done webinars on this bill, “Appraisers will be being asked by some AMCs and lenders for proof of business licenses (where required) because of the requirement in 2257”.


Mortgage lending sets a 20-year record with $1.1T in Q2

And refi volume for the third quarter will be even higher

Excerpt: U.S. lenders issued a staggering $1.1 trillion in home loans between April and June, marking the biggest quarter in at least two decades, according to mortgage data firm Black Knight. The record quarter highlights the growing disparity between homeowners who are primed to take advantage of perfect conditions, and those who are simply desperate to not lose their homes.

The surge in activity was driven primarily by an unprecedented rush to refinance. With rates ticking down to historic lows, homeowners tested lenders’ capacity limits with more than 2.3 million refinancings in the quarter, the most in nearly 17 years. Seventy percent of the total loans originated by dollar value in the second quarter were refinancings, according to Black Knight’s data.

To read more, click here

My comment: Appraisers are very busy. Time to turn down work from AMCs with low fees, excessive reviews, etc. For appraisers, Time Is Money! You can never get time back once it is gone. I’m working on articles about increasing productivity in my paid newsletter starting with the October issue. Getting too many ad-only emails?


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Increase Profits In Your Appraisal Business!!

Mortgage rates will go up, as they always do. Save for the future.

Business articles in the Paid Monthly Appraisal Today Newsletter

  • Practical tips you can use today for getting more appraisals done and make money
  • Staying positive with AMC hassles and low fees, etc.
  • Most appraisers focus on completing appraisals, not the business side of their companies, and make less money
  • Who’s on your Approved Client List and why? Don’t work for low fees with lots of hassles!
  • E&O Insurance Update – Where to Get E&O insurance, State Board Complaints, Your Biggest Risks, Etc.
  • Lots of ways to cut costs, and increase profits and cash flow
  • How to collect all your billings. Don’t work for free!!!

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Pandemic may lead to foreclosure crisis, CoreLogic says

Millions of American families could lose their homes amid COVID-19 pandemic, report says

Excerpts: A surge in the share of mortgages 90 days or more overdue in June is a signal the U.S. could be heading toward a foreclosure crisis, according to a CoreLogic report on Wednesday.

The share of loans with payments 90 days to 119 days late quadrupled between May and June, rising to 2.3%, the highest level in more than 21 years, said Frank Nothaft, CoreLogic’s chief economist…

Mortgage delinquencies have soared in recent months as Americans who lost income because of the pandemic sought forbearance agreements that allow them to suspend their home-loan payments without penalties. While they have permission to miss their payments, the mortgage industry still counts the loans as delinquent.

To read more, click here

My comments: The loss of the $600 per week additional weekly unemployment payments August 1 is a significant factor for both homeowners and tenants. Tenants are much more affected, of course.


Racial Bias Claims Without Proof or Logic

By Jonathan Miller

Excerpt: Is there racism in the U.S.? Of course, a lot of it and to me feels like its getting worse or just more overt. In fact, the American housing dream was built on racist neighborhood policies by government institutions in the depression era including awful things like deed restrictions.

The problem with this topic is that (in) The Brookings Institute November 2018 the devaluation of assets in black neighborhoods showed a stunning lack of understanding about the very industry it was attacking despite a well-considered write up about the disparity between the value of homes in neighborhoods of black and white residents of selected U.S. cities.

My comments: On June 19, 2019 I watched a livestream of Subcommittee on on Housing, Community Development and Insurance Hearing: “What’s Your Home Worth? A Review of the Appraisal Industry”. I was shocked at what I heard: Appraisers caused the disparity between homes in minority and white neighborhoods. I had not expected this. There was a 2018 November 2018 Brookings Institute report that blamed appraisers for lower property values in minority communities.

On August 20, The Appraisal Institute sent a letter to The Appraisal Foundation to address these issues.

On August 25, the New York Times published “Black Homeowners Face Discrimination in Appraisals” and brought up the issue again. My comments: It had examples of Black homeowners getting lower home appraisals than white homeowners. I never did this myself and had never heard of it being done.

My comments: For 35 years, I appraised homes in Oakland, CA. When I started I was very surprised to see the dramatically large differences in the “flats” (minorities) and the “hills” (white) neighborhoods for the same house. I had never appraised anywhere with very large differences. I was aware of the redlining there in the past, which appraisers cooperated with. But, my job was to report what was happening in values. Appraisers were not allowed to discuss the racial composition of a neighborhood or include photos of the residents.

To read more and watch the committee meeting on youtube, plus lots of links: click here Note: The beginning of the article discusses the recently issued Appraisal Institute letter about this topic. You may want to read the background material farther down the post first.

My comments: I had a brief summary plus a link to the Committee meeting in this newsletter last year. I could not figure out what to say about the issue and did not write much about it.

Fortunately, Tim Andersen’s very informative article on this topic will be in the October issue of the paid Appraisal Today newsletter. He is a USPAP expert and explains how USPAP, and appraisal practices relate to the allegation of racial discrimination.


COVID-19 recent news at

Two good, short videos from PBS NewsHour, with full transcripts

  • Dr. Fauci Comments on College students returning and Vaccines 9-8-20. 5 minutes. Click here. Scroll down the page to read.
  • How to get Covid-19 testing where and when we need it. 9-7-20. 7 minutes. Interview with Dr. Atur Gawande looking at the “big picture” of testing. Issues include more approved labs needed and frequent convenient testing. Click here.

Plus, of course, my Comments ;>

Check out my other blog posts – on the right side of every screen.

Here are a few:


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 increased 2.9 percent from one week earlier

WASHINGTON, D.C. (September 9, 2020) – Mortgage applications increased 2.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 4, 2020. This week’s results are being compared to the week of Labor Day 2019.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 2 percent compared with the previous week. The Refinance Index increased 3 percent from the previous week and was 60 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 3 percent from one week earlier. The unadjusted Purchase Index increased 0.2 percent compared with the previous week and was 40 percent higher than the same week one year ago.

“Mortgage rates declined last week, with a noteworthy 5-basis-point decrease in the 15-year fixed rate to a new record low of 2.62 percent. The drop in rates led to a rebound in refinancing activity, driven mainly by borrowers applying for conventional loans,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Purchase applications were 40 percent higher than the same week last year, but the increase is skewed higher by being compared to Labor Day 2019. Nevertheless, there continues to be resiliency in the purchase market. Applications were up almost 3 percent on a weekly basis and the average loan size continued to increase, hitting a survey high at $368,600.”

Added Kan, “Highlighting the strong overall demand for buying a home, conventional, VA and FHA purchase applications all increased last week.”

The refinance share of mortgage activity increased to 63.1 percent of total applications from 62.5 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2.2 percent of total applications.

The FHA share of total applications remained unchanged remained unchanged from 10.2 percent the week prior. The VA share of total applications decreased to 11.2 percent from 11.4 percent the week prior. The USDA share of total applications remained unchanged from 0.6 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.07 percent from 3.08 percent, with points remaining unchanged at 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 $510,400) decreased to 3.40 percent from 3.41 percent, with points decreasing to 0.31 from 0.38

(including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.16 percent from 3.19 percent, with points increasing to 0.42 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.62 percent from 2.67 percent, with points decreasing to 0.33 from 0.36 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 2.99 percent from 3.08 percent, with points increasing to 0.58 from 0.43 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

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.


Ann O’Rourke, MAI, SRA, MBA

Appraiser and Publisher Appraisal Today

1826 Clement Ave. Suite 203 Alameda, CA 94501

Phone 510-865-8041


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