2021 Appraiser Fee Survey
By Isaac Peck
Excerpt: The 2021 Appraiser Fee Survey includes 365 Metropolitan Statistical Areas (MSA), as defined by the U. S. Census Bureau, with rural areas included by state. The survey includes eight different appraisal products, including reviews and FHA appraisals, and addresses turn times, to offer insight into that controversial topic by area.
To check out the very detailed report for your MSA, click here
My comments: Lots of info by MSA! I got this info Wednesday and did not have time to look at it in detail.
Raise Your Fees, especially if working for AMCs!! Before AMC broadcast bids looking for the lowest fee, appraisal fees did not change much when volume changed. Since 1986 direct lender fees went up gradually. In my area, fees were about $250 in 1986 for SFR. Now fees have gone up to about $450 – $550 for regular long-time lender clients (and local AMCs). National AMCs are not loyal. Direct lenders can be loyal.
Fascinating and very comprehensive results by state and MSAs. I hear a lot about lenders and borrowers complaining about high appraisal fees. But in my area fees are not that high per the survey. I hear regularly about desperate AMCs who will pay $1,000 or more for appraisals. Appraisers are deluged with AMC appraisal requests, which are often deleted unopened of course. I also hear that sometimes the fee to the appraiser is much lower than the AMC fee.
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To read more of this long blog post with many topics, click Read More Below!!
NOTE: Please scroll down to read the other topics in this long blog post on unusual homes, bias, fees, non-lender appraisals, UAD, Fannie Update, mortgage origination stats, etc.
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Triangle House in Houston
Excerpts: A pointed residence in Houston adopts a new angle: a design no buyer has ever seen. It’s on the market for $649,000.
One reason a design like this triangle-shaped home could be built is that Texas’ largest city doesn’t have a zoning ordinance.
The sharp angles of the home accommodate two bedrooms, 2.5 bathrooms, and 3,067 square feet of living space. There’s also room for a chef-grade kitchen, dining area, living room, gym, and two home-office spaces.
To read more, click here
My comments: Hard to believe they could fit all that into a triangle. I have seen commercial buildings that are triangular in downtown areas, but never a home like this!!
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Fannie Mae August Update – UAD and Forms Redesign
Excerpt: Would you like to know more about the Uniform Appraisal Dataset (UAD) and Forms Redesign? Fannie Mae and Freddie Mac have just updated the FAQs. Learn about the key benefits, scope, and more.
To view the UAD FAQs, click here
Note: Look for “NEW” (in Red) in the list of UAD FAQs.
The Nine New FAQs include:
- Q5. Will the new UAD make it easier to describe and identify the property characteristics?
- Q7. Will the new UAD and URAR work for hybrid appraisal reports or alternative methods of inspection?
- Q8. Will the new UAD make the Sales Comparison Approach section of the URAR clearer?
- Q9. Quality and condition ratings are vague; will the new UAD help address them?
- Q10 Will the appraiser be able to add additional supporting information to the quality and condition ratings?
- Q11. Will all property types eligible for purchase by the GSEs be UAD-compliant?
- Q12. How will the various property types be identified if the current forms are retired?
To visit the UAD page read the answers, view the video and other resources, click here
Video is 3.46 minutes long, dated 1/26/21. Discusses forms design (one online form for all) and UAD changes.
My comments: We have been waiting for a long time. The 1004 is very old. UAD really needs updating. “UAD, the Movie” is a well-done overview. The infographic shows what the new online form may look like when printed.
A new timeline is coming “soon”. Of course, we don’t know how long it will really take for these changes to be completed ;>
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Thinking about doing non-lender appraisals?
Now is the very best time. Everyone else is very busy doing lender appraisals!!
I regularly receive calls from appraisers who are burned out on lender work and are thinking about quitting appraising.
I have done a lot of different types of non-lender work (residential and commercial) since I started my appraisal business 35 years ago.
I started writing about it in 1992 in my monthly Appraisal Today newsletter and have lots of tips to help you decide what types of work you want to do. Plus how to get appraisal assignments now!
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Special Briefing: The impact of race and socioeconomic status on the value of homes by neighborhood
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A Critique of the Brookings Institution’s ‘The Devaluation of Assets in Black Neighborhoods’ 1-hour audio with a transcript.
By AEI, American Enterprise Institute
Excerpts: Our work finds that what Perry et al. characterize as race-based differences in home values are actually, in large part, SES (socio-economic status) differences.
Lower SES certainly reflects a legacy of past racism and lingering racial bias, leaving Blacks at a large income (and wealth) disadvantage relative to most Whites.
However, if largely SES based, the primary remedy would be policies that work to address the income and wealth gap. Our work finds that while much work remains to be done, the focus should be on increasing financial security, creating generational wealth, and shrinking the SES gap through sustainable home ownership.
This is largely a buying power issue, not a valuation one. To do otherwise risks repeating the mistakes of the past. (Bold added)
To read more, click here
My comments: Finally an analysis of Brookings Institute data and conclusions! Fixing the wealth gap will be very difficult. For example, after World War II, in the Bay Area, many white GIs got FHA loans to purchase homes. Redlining and restrictive covenants limited where Blacks could purchase homes even if they had all cash. We still have much of the same segregation now.
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Property Appraisal and Valuation Equity (PAVE) First meeting
By Jonathan Miller
The current administration is addressing the lack of diversity in housing valuation with the formation of an interagency task force on Property Appraisal and Valuation Equity (PAVE).
Excerpt: I’ll get into the PAVE Task Force impact to appraisers in future posts as it unfolds but at first glance, I think this will end up being good for good appraisers as more and more information comes out for a number of reasons:
It will marginalize activists who have brought much-needed attention to the lack of diversity but literally do not understand what appraisers do
- It will reduce the pressure from the AMC industry, whose bad actors emphasize only speed and price
- It will re-focus emphasis on quality appraisers over AVMs
- It will help the public better understand what appraisers actually do
- It will shed light on the diversity issues of AVMs, which are built by human beings
The PAVE Task Force is quite significant to appraisers – it won’t leave us twisting in the wind because:
- It involves cabinet-level attendance, not for junior officials
- It has a 180-day deadline to deliver a final action report
- The ASC is a member of the task force
- The agencies that comprise the ASC are also a part of it
Editor’s Note: Miller has issues with TAF. I have objections to some of what TAF does also. However, PAVE was made up of government agencies and TAF is not a government agency, so it was eligible to be on the committee.
To read more, click here
Scroll down the blog post for a list of attendees
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More info on PAVE:
Excerpt: In response to President Biden’s directive, Secretary Fudge, along with Domestic Policy Council (DPC) Director Susan Rice (and now Co-Chair), established the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE). The Task Force will deliver a final action report within 180 days that: (i) describes the extent, causes, and consequences of undervaluing of properties; and; (ii) finalizes and releases a roadmap of consumer facing and industry actions and policy implementation that agencies and other participants commit to take to address the undervaluing of properties.
The Task Force exists within the Department of Housing and Urban Development (HUD) and facilitates meetings with Principal Task Force Members (and their Staff Representatives).
To read more about PAVE, click here
My comments: I did not watch the meeting and could not find a recording online. Per an online post by a reliable appraiser who watched the meeting, Jim Park of the ASC was there. He was probably the only appraiser. Jim was a fee appraiser in the past.
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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. I have been following this data since 1993. For more information or get a FREE sample issue go to https://www.appraisaltoday.com/
Mortgage applications increased 2.8 percent from one week earlier
WASHINGTON, D.C. (August 11, 2021) – Mortgage applications increased 2.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 6, 2021.
The Market Composite Index, a measure of mortgage loan application volume, increased 2.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 3 percent compared with the previous week. The Refinance Index increased 3 percent from the previous week and was 8 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 18 percent lower than the same week one year ago.
“Mortgage applications rebounded last week, including an increase in purchase applications for the first time in nearly a month. Rates slightly rose but remained below 3 percent, driven by an end-of-week increase in the 10-year Treasury yield following the positive July jobs report,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Homeowners continue to respond to lower rates, with refinance activity climbing to the highest level since February 2021. The refinance share of loan counts was at 68 percent, compared to a 63.4 percent share for refinances by dollar volume, as purchase loans continue to see significantly higher loan sizes.”
Added Kan, “The higher level of purchase activity last week was driven by more government purchase applications, including a 3.3 percent increase in FHA loans. With low for-sale inventory keeping home-price appreciation in many markets at record highs, the jump in FHA purchase applications is potentially a sign that more first-time buyers are finding purchase options despite the high prices.”
The refinance share of mortgage activity increased to 68.0 percent of total applications from 67.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 3.2 percent of total applications.
The FHA share of total applications decreased to 8.9 percent from 9.0 percent the week prior. The VA share of total applications decreased to 9.6 percent from 9.9 percent the week prior. The USDA share of total applications remained unchanged from 0.5 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 2.99 percent from 2.97 percent, with points decreasing to 0.30 from 0.33 (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 3.15 percent from 3.12 percent, with points decreasing to 0.29 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 3.06 percent from 3.08 percent, with points decreasing to 0.27 from 0.29 (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 2.35 percent from 2.33 percent, with points increasing to 0.25 from 0.23 (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 2.52 percent from 2.93 percent, with points decreasing to 0.15 from 0.20 (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.
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Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
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Phone 510-865-8041
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