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How much vacation time do self employed appraisers usually take per year?

www.appraisalport.com Poll Results, June 17, 2013

How much vacation time do you usually take per year?
None 893 votes 15%
1 week or less 2,251 votes 39%
2 weeks 1,624 votes 28%
3-4 weeks 712 votes 12%
5-6 weeks 128 votes 2%
More than 6 weeks 107 votes 2%
I’m partially retired 128 votes 2%

Total Votes: 5,843

My comment: I remember 26 years ago, when I was a corporate employee with 3 weeks vacation, plus sick leave. Of course, I was not a good employee. I am just not suited for working for someone else. But, I do miss those regular paychecks, vacation, benefits, etc. etc.

Posted in: appraisal, appraisers

Two very different results for appraisers’ opinion of the future

Press release:
CHICAGO (July 17, 2013) – More than three-fourths of U.S. real estate appraisers are very or somewhat positive about the demand for their services over the next one to two years, according to an Appraisal Institute survey released today.

Eighty percent of residential appraisers and 78 percent of commercial appraisers said they are upbeat about their future, according to the survey conducted in May-June by the nation’s largest professional association of real estate appraisers.

“Appraisers have faced a challenging real estate market in recent years, and it’s great to see that so many valuation professionals are feeling optimistic about the future,” said Appraisal Institute President Richard L. Borges II, MAI, SRA.

According to the survey, 95 percent of residential appraisers and 49 percent of commercial appraisers said there is currently more demand for their services than a year ago.

My comments: Hmmm… refi demand has been declining because of increased rates. “Starter” home sales may be affected – harder to qualify for buyers. Don’t know about all cash investors, a big part of the market in many areas. Commercial appraisal fees are still down in many parts of the country. But, it is good to see that some appraisers are optimistic, at least during the survey period of May 31-June 17. The commercial appraiser results are interesting as they are seldom surveyed. The results are similar to what I have observed locally.
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Additional results  from the AI survey (excerpts):

Trainee hiring

Trainee hiring will remain relatively weak for the next one to two – years. While commercial real estate appraisers comprise less than one – third of practicing appraisers in the US, they disproportionately employ more full – time appraiser trainees.

Commercial appraisers also hired more trainees in the past 12 months than residential appraisers did, and commercial appraisers said they would hire more full-time trainees in the next one- to two-years than residential appraisers would hire.

Nearly one-half (49 percent) of commercial appraisers surveyed said they employed one or more full-time appraiser trainees in the past 12 months. By comparison, less than one-third (29 percent) of residential appraisers employed one or more full-time trainees.
„h Of the residential appraisers who employ trainees, an overwhelming majority (93 percent) employs one to three trainees ¡V only 7 percent employs four or more trainees. Comparatively, slightly more than one-fifth (21 percent) of commercial appraisers employ four or more trainees.

Strong majorities of commercial and residential appraisers surveyed (75 percent and 80 percent, respectively) said the number of trainees retained in the past 12 months did not change. Concerning recent new hires, 14 percent of commercial appraisers said the number of trainees retained increased over the past 12 months. Comparatively, only 5 percent of residential appraisers hired more trainees.

Res appraisers – different clients than commercial appraisers
Substantial proportions of commercial appraisers anticipate more demand from financial institutions (47 percent), law firms/lawyers (33 percent), and government agencies (25 percent). Residential appraisers anticipate a different mix of business predominantly from AMCs (36 percent), financial institutions (34 percent), and property owners/buyers directly (33 percent).

Commercial and residential appraising are going in very different paths. These results reflect that dichotomy. Commercial appraisers are seen as professionals. Residential appraisers used to be seen as professionals but are now perceived by way too many clients as not reliable, probably because of the 2008 crash.

Click here to read the full press release
http://www.appraisalinstitute.org/newsadvocacy/news/2013/Real-Estate-Appraisers-Optimistic-About-Future-16-7-13.aspx

Click here to read the full survey results:
http://www.appraisalinstitute.org/newsadvocacy/downloads/fact_sheets/2013-Real-Estate-Appraisal-Outlook-Summary_Jun-28.pdf

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Appraisalport poll – 6/23/13

How do you foresee your workload and income changing in the next year if the government slows its purchase of mortgages and/or interest rates begin to rise?

I see things slowing a lot. 2,083 votes 36%
I see things slowing a little. 2,210 votes 38%
I don’t’ see any real change 1,091 votes 19%
I see things picking-up a little. 218 votes %
I see things picking-up a lot. 139 votes 4%

Total Votes: 5,741

FYI, appraisalport users do residential lending appraisals. www.appraisalport.com
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My comment on the two survey/poll results: Quite a difference between the results of the two surveys!! Of course, the Appraisalport survey asks the opinion if rates rise and mortgage purchases slow, but most everyone sees rates rising. Also, it was a poll, not a survey. Appraisalport users work for lenders. Rates started increasing in May.

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Posted in: appraisers

Appraisers warned us about the crisis but we didn’t listen

By William K. Black

Excerpts:

On July 9, 2013 I participated in a radio interview with a lobbyist for the 100 largest financial firms.  The San Francisco radio program host asked me what question I would ask the lobbyist and I said that any discussion should begin with allowing him to state his view of what caused the crisis.  In the course of his explanation, he bemoaned the fact that there was no warning about the crisis.

I found this ironic because I had just published that morning an article about how the appraisal profession warned us that the senior officers controlling the mortgage lending firms were engaged in pervasive “accounting control fraud.”

Note that the appraisers’ petition began in 2000 and was public.  When the regulators and prosecutors did nothing in response to the appraisers’ warning the appraisers delivered it to government officials to ensure that no one could say they were not warned.  What tends to be forgotten is that the mortgage industry’s leaders did nothing to restrain the fraud epidemic and a great deal to expand it.  A finance industry representative claiming in 2013 that no one warned the industry of the coming crisis when the warnings began no later than 2000 epitomizes the industry’s death of accountability, integrity, and candor.

My comment: Worth reading. Appraisers got what they wanted – freedom from mortgage broker pressure. But, at a huge cost – low fees and incredible scope creep. Fees are up now, but will go down when lending slows down. Maybe lenders will figure out that scope creep doesn’t help anyone and slows down appraisal production.

http://www.creditwritedowns.com/2013/07/housing-appraisers-warnings-fraud-crisis.html

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Posted in: appraisers

Commercial AVM??

First American Professional Real Estate Services Releases Automated Value Model For Commercial Properties

Press release excerpt:
First American Professional Real Estate Services, Inc., a leading provider of real estate transaction-based products and services through its Evaluations group, announced today the release of the Indexed Value Report (IVR), an automated valuation model (AVM) for commercial properties.

Used in portfolio management, loan extensions and new originations by commercial lenders and others, the new IVR model incorporates current commercial property sales data from assessors’ offices, covering more than 3,200 counties in the United States.

In an independent reliability test conducted by three professors from Minnesota’s St. Cloud University on 19,000 commercial properties sold within the last year, the IVR estimated that values for these commercial property sales across the U.S. represented an average of 87 percent of the purchase price and a median value of 103 percent of the purchase price. This is considered to represent reliable indications of value from an AVM. Additional information about the new IVR can be found by visiting www.firstamces.com .

My comment: Over the past  20 years, every so often I heard about one of these. None of them were successfully implemented and sold. Of course, the problem, as with residential AVMs, is data. Costar was rumored to be looking at one some time ago. I can’t imagine using assessor’s office information that is publicly available for a commercial AVM. Income and expenses are critical to determining values for many commercial properties.

Click here for the full press release:
http://www.firstam.com/news/2013/65278.html

Click here for more detail on the product and a link to a sample report
http://www.firstamprs.com/products_services/survey_site_coordination/commercial_evaluation_services

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Posted in: appraisers

Quirky houses can make lenders nervous

Excerpt:

Want to live in a geodesic home or a reproduction of a medieval castle? Jumbo borrowers shopping for offbeat homes may face challenges in getting a mortgage.

Kristi Gillis and her husband, Bill Hollars, bought a geodesic home in Montera, Calif., for $700,000 last fall. The couple was preapproved by a major bank for a jumbo mortgage, but when they told their lender they planned to buy the domed home, the bank withdrew the financing. Every lender they contacted refused to discuss a loan because of the house’s unusual shape. “What was upsetting is that we thought we’d done everything right,” Gillis said. “We both were pretty shocked, and even the agents involved were surprised.”  (They did finally get a loan)

“An artsy person who lives outside the box will look at one house and think it’s stunning,” said Karen J. Mann, a Discovery Bay, Calif.-based appraiser who covers the San Francisco, Silicon Valley and Sacramento communities. “When an appraiser looks at it, it’s about what’s the norm for the area.

My comment: And the appraisals can be nightmares!! Fortunately, we can google the address and see the house before re-negotiating the fee or Just Say No!

Link to original article: http://www.marketwatch.com/story/quirky-houses-can-make-lenders-nervous-2013-07-02?siteid=rss

Posted in: appraisal, appraisers, lender appraisals

Chase not liable for AMC appraisal fees?

A Florida Bankruptcy court said Chase was not liable for appraisal fees not paid by Evaluation Solutions, which is in bankruptcy.

There has been a lot of online discussion about this. I don’t understand the legal issues.

Fortunately, Scot DiBiasio of the Appraisal Institute posted a succinct comment on the Appraisal Buzz email forum. Here is his revised version – succinct and easy to understand.

“This decision is from one Judge in a single U.S. Bankruptcy Court District – the Middle District of Florida.  Another Judge in the same, or different, Court could very easily rule a different way on a different case. And, it remains to be seen whether or not the valuation companies that objected to the Settlement Agreement in this case will appeal to the U.S. District Court or to a Bankruptcy Appellate Panel, where the outcome could change.”

Here’s a link to the recent WorkingRE article on the topic:
http://www.workingre.com/workingre/Bankruptcy-Court-Absolves-Chase-of-All-Liability-page.html

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Posted in: appraisers

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This blog has recent full FREE email newsletters (that start with the date and Newz) plus excerpts from the email newsletters where you can post comments. This newsletter has been sent out almost every week since June, 1994. I started with 6 subscribers on Compuserve. Now it is up to 17,000 subscribers!! To subscribe to the free email newsletters and get them them when they first come out, go to www.appraisaltoday.com and sign up in the big Yellow Box!!

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Posted in: appraisal, appraisal business, Appraisal fees

Poll – Taking comp photos?

Poll Results 4/1/13 – www.appraisalport.com

With many ways available to view a property (ex. MLS and Google photos) how do you feel about having to always include your own comp photos?

Always necessary 1,928 votes 36%
Sometimes necessary 1,731 votes 32%
Rarely necessary 1,313 votes 25%
Never necessary 368 votes 7%
Total Votes: 5,340

My comment: interesting results. I have to take my comp photos, even if I have seen the property recently. I’m always afraid I will miss something… I guess I am just “old school”. Of course, I have only done a few desk appraisals or reviews. I just couldn’t seem to be able to do them. Oh well…

I love these www.appraisalport.com surveys!! Thanks to Steve Costello for doing them!!

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Posted in: appraisal

Appraisers' forecast for 2014

www.Appraisalport.com   – another great poll!!

How do you foresee your workload and income changing in the next year if the government slows its purchase of mortgages and/or interest rates begin to rise?

I see things slowing a lot. (36.4%) 1,886 votes
I see things slowing a little. (38.5%) 1,993 votes
I don’t’ see any real change (18.9%) 978 vote
I see things picking-up a little. (3.8%) 198 votes
I see things picking-up a lot. (2.4%) 126 votes
Total Votes: 5,181

My comments: I suspect it will slow down but I don’t know how much. Lots of appraisers are turning down work every day now. Time to prepare for the upcoming slowdown, with the inevitable reduced fees. Fees are now based on supply and demand of work.

Make as much money as you can on each appraisal you accept.

The July issue of my Appraisal Today newsletter, see below, has an excellent article on negotiating with AMCs to make more money.

I also have an article on getting started doing divorce appraisals. I have always taken non-lender work, since I started my appraisal business in 1986. I would not be in business today if I didn’t have it to help me get through the down cycles of appraising, both the big and small swings in volume of business.

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Posted in: appraisal

Change in the number of appraisers since 2000!

My comment: I like to use California data as trainees were licensed, giving a much better picture that asc.gov, which does not include trainees, only licensed and certified. The number of residential appraisers has always gone way up and down, dependent on mortgage lending volumes. Lenders will start allowing trainees when the number of appraisers get too low. About half the residential trainees/appraisers lose their jobs in the downturns. Nothing new. Commercial appraising has always been much steadier as there was reliable, steady work.

This was posted 5/25 by George Hatch on the very active http://appraisersforum.com 

I’ve been keeping track of the number of licensees in my state (California) for a long time now. As of this morning this is what it looks like:

– The low point in numbers was in 2001-2002, but the percentage comparisons are made against 2000.
– The number of fully licensed/certified residential appraisers last bottomed out at less that 6,000 heads before nearly doubling by 2008.
– The number of CGs have steadily declined each year during the entire time frame except that we had a one-time bump (~170 heads) in 2007 prior to the increase in qualifications criteria.
– Even though the number of fully licensed/certified residential appraisers is 23% lower than the 2008 peak it’s still 36% higher than it was 10 years ago.
– The number of CGs has dropped to within 19 heads of the previous low spot in 2003, and remains 17% lower than the 2000 number. I would imagine this year we’ll lose enough more heads to result in the new low.
– If any of you residential appraisers (in CA) are actually giving serious consideration to restarting your puppy mill operations just remember that the CA market is still grossly overserved relative to the number of appraisers prior to 2005. You’ll be cutting your own throats – again – the next time the markets bust.

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Posted in: appraisers