The Surfing Appraiser

Riding the Waves of Up and Down Mortgage Rates 

By Mark Buhler

Excerpts: Riding the waves of the appraisal profession can result in a range of outcomes and emotions over time. Appraisers, and surfers, have varying levels of experience, and experiences. Most appraisers have been through some extremely busy seasons that have been very positive. Those same appraisers have gone through droughts, where appraisal orders dried up.

Appraisers have been blessed to have the independence and autonomy to create whatever they want for themselves. Most workers in America do not have the same opportunities for success and advancement that appraisers have. Look at this lull as a time of opportunity. A time to finally work on and execute a plan for your business.

During the refinance boom of the early 2020’s, the majority of appraisers did not have time to come up for air. The waves of work kept them down, and every time they got a chance-they grabbed the next order (or wave) and maximized the opportunity while it was there. Appraisers were busy cranking out appraisal reports. Now appraisers are not busy, but they should be. Do not get out of the water and put your surfboard away. Stay out there, splash around in the calm ocean, there are waves coming.

To read more, Click Here

My comments: Read the full article! This article uses surfing as an excellent illustration. In my 20s, I lived in my van for a few years and parked it near my surfer friends’ house in Santa Cruz, CA. They surfed every morning when the waves were good (Steamer Lane), cold or raining. When the waves were low, they stayed home or went over to see if there were any changes. I watched and listened to them talk about it and learned a lot. A very good analogy to 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 , , VA changes, State Appraisal Board problems, gratitude for appraisers, unusual homes, mortgage origination stats, etc.


San Francisco Bay’s Red Rock Island is for Sale for $25M

Excerpts: Red Rock Island is the only privately owned island in San Francisco Bay.

Current owner Brock Durning, who has been living in Alaska for decades and inherited the property from his father, told Christie’s that he hasn’t visited the island recently and decided he wants to sell so he’s financially able to take care of his aging mother.

As cool as it may sound to own a private island in the bay, it comes with lots of baggage. For starters, any development would have to pass through three levels of bureaucracy, as 4.1 acres of the island lie in Contra Costa County, 0.09 acre is in Marin and the remaining 1.58 acres in San Francisco.

The city of Richmond, likely to endure any consequences of building, organized to oppose it in the past. A private home is a more likely option, given that an owner could build on just the Contra Costa land, avoiding interactions with the other counties. Even that, if approved, would likely take years if not decades to complete, since almost none of the island is level.

To read lots more about the very interesting history, Click Here

My comments: I sailed and raced my sailboat in San Francisco Bay for over 15 years. Red Rock was always a mystery to me. Maybe this time it will sell and become who knows what or not change at all. Sorry, not interested in the appraisal unless there is a huge fee


“Naked, Unarmed, and Alone?”
In front of your State Appraisal Board

Timothy Andersen, MAI

Excerpts: Question: “My state board recently charged me with authoring a misleading report. I got the client to write a letter to the state indicating my report did not mislead them, yet the state sanctioned me for it anyway! If my client says I did not mislead them, how can the state board say I did?!”

Answer: The answer to this question is one with numerous and subtle twists-and-turns. Really, you can’t go into a contest with your state appraisal board naked, unarmed, and alone. Why would you want to? Obviously, you need legal counsel, but you may also need USPAP counsel as well. So, your first step is to get proper counsel, who can then give you proper advice…

A state’s appraisal board carries the sword and shield of legal counsel. Why should you enter that arena naked, unarmed, and alone?

To read more, Click Here

My comments: It’s worth reading. I am so glad we never had a state board in California! Arnold Schwarzenegger was governor when licensing started and wanted to keep costs down. At first, fee appraisers were used as investigators. Then, it soon moved to state employees only.

Being a board member and practicing appraiser can be a conflict as you are making decisions on other appraisers. Over the years, I have heard about some bad situations in other states.


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E&O Insurance Tips

Many appraisers are very slow now. Some are thinking about quitting or retiring. Others are looking for a lower-priced policy

What about appraisers who are thinking about quitting appraising or retiring – Get a tail coverage policy!

If you qualify, you can get lifetime tail coverage for free from the E&O companies that offer this benefit. Requirements vary widely – number of years with the E&O broker, years of experience, etc. Check with your E&O Broker.

The cost is typically 3 times the price of your final year’s coverage. Be sure to get 5 years. A one-year policy is not worth much.

Unfortunately, very few appraisers who are leaving the business get “tail coverage”. They just let their insurance lapse. This means that they are self-insuring for all possible claims for appraisals done before they discontinued paying for insurance.

What if you get tail coverage and want to start appraising again? Check with your E&O company. They may allow you to come back as an insured appraiser.

Shopping only for the price is not a good idea.

Instead, you need to check out the exclusions, limits, etc. The cheapest is not always the best, especially when you have a claim.

I recently spoke with a residential appraiser who had a complicated problem with a non-lender client, who said it was okay to refund the fee. I told the appraiser to contact his E&O carrier. He contacted them and said they could not help him unless there was a claim. I had never heard of his E&O company. I told him to refund the fee ($1,700) and take it as a good business lesson about selecting E&O companies. Also, avoid problems by not using the same engagement letter for every appraisal. I often suggest refunding the fee. I have done it myself a few times over the years, up to $2,000.

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Gratitude for Appraisers By George Dell, MAI

Excerpts: Why should I have gratitude? Ugh!

My clients want me to hit the number . . . And be ethical about it! Pressure, pressure, pressure.

For me, the problem was the way I looked at things. I saw gratitude as a way of giving thanks for what had been given me. I see things differently today.

For me giving thanks is different from being grateful. Once again, my self-oriented brain got tricked into doing good for me. I was outsmarting myself. Gimmie, gimmie, gimmie, then I will thank you. But there were some things I didn’t know. I didn’t know what I didn’t know. It turns out gratitude is a tool. A method for making my own life better. Even better. . . it made the lives of those around me better. And they behaved better also. Unbelievable!

Once again, modern brain-body science jumps ahead and teaches me things. I am told there are seven scientifically proven benefits of gratitude. They say gratitude is one of the most misunderstood free tools for a better life. There’s no money involved. And the benefits are amazing.

To read more, Click Here

My comments: I got this link after last Friday’s newsletter, so I could not include it before Thanksgiving. I will never forget George’s original blog post in 2018. One of his very best blog posts, in my opinion!


California Home Is Actually a $1.4M Part Modular Build in El Sobrante, CA


5 bedroom, 3 bath, 2,224 sq.ft., 0.33 acre lot

The main house is 1,600-square-feet, with three bedrooms and two baths. The guesthouse has two bedrooms and one bathroom. Both have full kitchens with European appliances.

The home’s price has been reduced by $100,000 since its initial listing.

At first glance, it might not register that most of this modern-industrial home in Northern California was built in a factory, delivered by a truck, and assembled on-site. This brand-new property is indeed part modular home.

“Some of it is shipping container, and some of it is their own construction—the bar is a shipping container, the pool is a shipping container, and the ADU is a shipping container,” Rowland says, referring to an accessory dwelling unit, meaning the separate guesthouse. “The main house is just the end modules of shipping containers, and the rest is steel construction.”

For more information, Click Here

To see the listing with 3d tour and 53 photos Click Here

My comments: El Sobrante homes median price is $749,000. The median price in my city (15 miles away) is $1.1 Million, close to the Bay Area median. This property is well above the median for El Sobrante and is unusual construction for this area, thus the price drop. Thanks (again) to reader Joe Lynch for this link!


VA halts foreclosures for veterans about to needlessly lose their homes

Thousands of veterans are at risk after change in COVID forbearance program that provides affordable way to get current on home loans.

Excerpts: The Department of Veterans Affairs is halting foreclosures for six months for veterans and service members who have VA Loans.

The move follows an investigation by NPR that found thousands of veterans who took what’s called a COVID forbearance are now at risk of losing their homes through no fault of their own.

“Helping Veterans and their families stay in their homes is a top priority at VA,” said VA Press Secretary Terrence Hayes in a statement. “We are calling on mortgage servicers to pause foreclosures of VA-guaranteed loans through May 31, 2024.”

The forbearance program was set up by Congress after the pandemic hit in order to let people who suffered a loss of income skip mortgage payments for six or 12 months, and then have an affordable way to start paying their mortgage again.

But in October 2022, the VA ended the part of the program that allowed homeowners an affordable way to get current on their loans again, which has left many veterans facing foreclosure. The VA has a new program to replace it, but says it will take four or five months to implement.

For more information, Click Here

My comments: I have recommended that appraisers join the VA for decades. Many VA appraisers still have some work. Working for the VA means you are helping veterans. Quite different than others in the lending business who just want to make as much money as they can. Thanks to long-time reader Doug Smith in Montana for sending me this link.


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, Click Here

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 go to Or call 510-865-8041, MTW, 7 AM to noon, Pacific time.

My comments: Rates are going up and down. Many appraisers are not busy. Some are busy, usually with non-lender appraisals.


Mortgage applications increased 3.0 percent from one week earlier

WASHINGTON, D.C. (November 22, 2023) — Mortgage applications increased 3.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 17, 2023.

The Market Composite Index, a measure of mortgage loan application volume, increased 3.0 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 0.1 percent compared with the previous week. The Refinance Index increased 2 percent from the previous week and was 4 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 4 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 20 percent lower than the same week one year ago.

“U.S. bond yields continued to move lower as incoming data signaled a softer economy and more signs of cooling inflation. Most mortgage rates in our survey decreased, with the 30-year fixed mortgage rate decreasing to 7.41 percent, the lowest rate in two months,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Mortgage applications increased to their highest level in six weeks, but remain at very low levels. Purchase applications were up almost four percent over the week, on a seasonally adjusted basis, as both conventional and government purchase loans saw increases. The average loan size on a purchase application was $403,600, the lowest since January 2023. This is consistent with other sources of home sales data showing a gradually increasing first-time homebuyer share.”

Added Kan, “Refinance applications increased 1.6 percent last week, but the level of refinances continues to be well below historical averages, given that most borrowers already have a rate well below current market rates.”

The refinance share of mortgage activity increased to 32.4 percent of total applications from 31.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 8.3 percent of total applications.

The FHA share of total applications increased to 14.8 percent from 14.4 percent the week prior. The VA share of total applications increased to 11.3 percent from 11.2 percent the week prior. The USDA share of total applications decreased to 0.4 percent from 0.5 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 7.41 percent from 7.61 percent, with points decreasing to 0.62 from 0.67 (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 $726,200) decreased to 7.51 percent from 7.65 percent, with points decreasing to 0.62 from 0.67 (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 7.19 percent from 7.36 percent, with points decreasing to 0.79 from 0.85 (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 6.89 percent from 6.94 percent, with points decreasing to 0.76 from 1.00 (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 increased to 6.76 percent from 6.65 percent, with points increasing to 0.82 from 0.72 (including the origination fee) for 80 percent LTV loans. The effective rate increased 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.

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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