Has Appraising Failed the Public Good?

by Steven R. Smith, MSREA, MAI, SRA

Excerpts: The term Public Good is in the opening paragraph of the Uniform Standards of Professional Appraisal Practice (USPAP). An appraiser friend once wrote that our regulations and guidelines are intentionally ambiguous—and that may be. But what is crystal clear to me is that the industry has put the interests of its clients before the public good.

The Public Trust statement and the Ethics Rule have been largely ignored over the years with loan production put first…

What can an individual appraiser do to support the public good, even before they start an assignment? For me, the answer always has been to appraise the client and the appraisal assignment. There are some clients and assignments that simply should be avoided because of the wants, needs and desires of the client, with respect to the assignment results.

To read more, click here

My comments: I have known Steve Smith for a long time. To read more comments from Steve and other savvy appraisers, join the National Appraisers Forum, an email discussion group. I have been a member since it started. It is my “go-to” resource for appraisal topics. Moderated. Very different from Facebook and other appraiser online discussion groups where filling out forms and dealing with AMCs are discussed.

The future of residential appraising

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on unusual homes, appraiser diversity, Cost Approach, liability, mortgage origination stats, etc.


Jura House / Scott Donald Architecture U.K.

Excerpt: The construction of the building is steel-frame, dictated largely by the expanse of glazing and feature cantilever. The material palette is relatively understated – white render and grey limestone. Sections of black zinc articulate the rear elevation. Together, these materials combine to form a clean, crisp aesthetic, softened by the surrounding landscape.

Read more and see lots of very interesting photos plus building drawings, click here

My comment: The writing is a bit technical, but the photos say a lot. Thanks to appraiser Scott Jura in Fresno, CA for the link to this very interesting home. No, it is not his house ;>


Real Estate Appraisers Tend To Marry Real Estate Appraisers 

By Jonathan Miller

Excerpt: Previously, I spoke about this post: Jobs that Marry Together 

the Most (to see other careers), but given my career as a real estate appraiser, I’m guilty as charged.

To see another graphic and read more, click here and Search for Appraiserville (near the bottom).

My comments: Worth a look. Popup menu to subscribe to his weekly posts.


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Don’t Assume You Did it “Right” the First Time

By Claudia Gaglione, Esq.

Excerpts: It is not unusual for an appraiser to be asked to appraise the same property on more than one occasion. Sometimes, it is a coincidence. The client may have no idea the appraiser had a history with the property and the appraiser might not even remember until he or she inspects the property and recalls having been there before.

In other cases, an appraiser might be retained, specifically, because they did appraise the property in the past. Since that appraiser already has some knowledge, and familiarity with the property, the client might think it makes sense to retain them over someone else.

Each appraisal assignment should be approached as a “new” assignment, and NOT as a “do over.” Problems can arise if the appraiser simply duplicates information from an old report into a new report without taking the time to verify or to double check what was contained in the old report.

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Builders Report 26 Percent Increase in Material Prices

Excerpt: Material availability and costs are one of several factors, including the cost of regulation and a general shortage of construction labor, limiting the supply of housing, particularly for the entry-level market where additional inventory is badly needed.

To read more, click here

My comment: How accurate is your cost approach replacement cost??


Diversity in Appraising

By Robert Lewis

Excerpt: I’m an African American male with an MBA degree, concentrating in Real Estate and Urban Affairs. I’m also a Certified Residential Appraiser. My first real estate job as a staff appraiser was with a firm that was a precursor to the modern-day Appraisal Management Company. The company employed twelve staff residential appraisers. I was the only African American appraiser.

I was assigned to appraise properties in the predominantly black areas of Atlanta, GA. When I showed up at a homeowner’s residence, the first reaction was joyful shock that a black appraiser was appraising their home. For most of these black homeowners, I was the first African American real estate appraiser that they had ever encountered, and they told me so.

To read more, click here

My comments: Well written and worth reading. Written by an insider. Goes over current negative appraiser comments and details of the historical context. .

This issue is very personal for me because of the 100th anniversary of the Tulsa Race Massacre. Myself and my mother were born in Tulsa. My family lived there for decades. I never heard any mention of what happened. My parents taught me that everyone was equal. The current mayor of Tulsa said he found out about it in 2001 when a group setup to write about it issued a report.

The main local newsletter, The Tulsa Tribune, destroyed all copies of any issues reporting on the event. Another local newspaper kept an issue available.

Tulsa was not in the south and had few “Jim Crow” restrictions. All or almost all the Blacks lived in north Tulsa, on the other side of railroad tracks. This segregation is not usual in the U.S. due to the Redlining that started in the 1930s and other local issues. There was one Black person in my younger brother’s large Catholic schoolin the mid-1960s. He said a Black family moved into a nearby rental house in South Tulsa. Their house was toilet-papered, etc. They moved out within a few months.A


New Appraiser Discusses his Journey into the Industry 

Video by Appraisal Buzz and Article by Marcus Knight, the new appraiser

Excerpt: Where I am now is due entirely to the Appraisal Diversity Initiative (ADI) sponsored by Fannie Mae and the National Urban League. I went to a meeting earlier in the day at the Chicago Urban League, and as I was leaving, I happened to walk past the ADI event as it started and thought to myself, “why not attend?”

During the event, Black Appraisers spoke about their experiences in the field, how it changed their lives, and its importance to community development. I wanted to know more, so I learned about the ADI scholarship, I applied, and in a few weeks, I was notified I was selected as an awardee. This scholarship allowed me to take all the basic courses and proctored tests necessary to be licensed as a trainee. It came at the right time as for some time I had been contemplating a career change. It all felt serendipitous.

To read more, click here

My comments: The appraisal profession needs to take a good look at itself. The Appraisal Institute’s U.S. Valuation Fact Sheet of the Valuation Profession Q1 2019 has 1.4% Black/African American, 21.3% female, and 85% Caucasian appraisers. Read the report for lots more data.

I got my first appraisal job at an assessor’s office in 1975 because of affirmative action. I was the first woman hired. They put me in a cubicle in the back because they were not sure what would happen. They thought women should only work in the office. I had worked on the 1970 census going to thousands of homes. All my previous jobs were in labs. I was used to taking science classes and working with men.

There were very few female appraisers before the mid-1970s, except a few that worked in family appraisal businesses. Today, 21% female is low as women are over 50% of the population.


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 www.mbaa.org 

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 https://www.appraisaltoday.com/products.htm or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 7AM to noon, Pacific time.


Mortgage applications decreased 4.0 percent from one week earlier,

Mortgage applications decreased 4.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending May 28, 2021. This week’s year-over-year results are being compared to the week of Memorial Day 2020.

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.0 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5 percent compared with the previous week. The Refinance Index decreased 5 percent from the previous week and was 6 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent compared with the previous week and was 2 percent lower than the same week one year ago.

Mortgage applications decreased for the second week in a row, with the overall index reaching its lowest level since February 2020,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Tight housing inventory, obstacles to a faster rate of new construction, and rapidly rising home prices continue to hold back purchase activity. The government purchase index declined to its lowest level in over a year and has now decreased year-over-year for five straight weeks. Purchase applications were down almost 2 percent from a year ago, but that was compared to the week of Memorial Day 2020.”  

Added Kan, “Refinance activity dropped for the second straight week, even as the 30-year fixed rate decreased slightly to 3.17 percent. Even though rates have been below 3.20 percent over the past month, they are still around 20-30 basis points higher than the record lows in late 2020.”  

The refinance share of mortgage activity decreased to 61.3 percent of total applications from 61.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 3.7 percent of total applications.

The FHA share of total applications increased to 9.6 percent from 9.1 percent the week prior. The VA share of total applications decreased to 10.9 percent from 11.2 percent the week prior. The USDA share of total applications remained unchanged from 0.4 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 3.17 percent from 3.18 percent, with points increasing to 0.39 from 0.35 (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 $548,250) increased to 3.34 percent from 3.30 percent, with points increasing to 0.38 from 0.30 (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 decreased to 3.16 percent from 3.20 percent, with points increasing to 0.31 from 0.25 (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 increased to 2.56 percent from 2.53 percent, with points increasing to 0.31 from 0.27 (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 decreased to 2.54 percent from 2.81 percent, with points remaining unchanged at 0.29 (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

Email  ann@appraisaltoday.com 


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