Appraisal News and Business Tips


When will the residential lender appraisal business pick up?

Loan applications have been declining sharply since April, 2013

How do I know? Loan applications peaked in April 2013 and have been declining since then. Appraisals are ordered after loan applications so loan origination data tells you the future. The Mortgage Bankers Association has published a weekly index of loan applications since 1990. I have included a graph in every issue of my paid Appraisal Today newsletter since 1992. I also periodically include a copy of the MBA’s weekly data in these free email newsletters. Also, of course every economist has been forecasting substantial declines in loans.

About a month ago I started getting the inevitable calls from appraisers when they finally figured out their lender business has slowed down. I enjoy talking with appraisers, but it seemed better to tell my almost 14,000 email subscribers.

What are the main questions from appraisers?
How do I get non-lender work?
Do I think business will pick up soon?
How can I find out the names of good AMCs?

What appraisers are not asking is:
– Which AMCs will be going out of business?
– Are AMC fees dropping?

When will business pick up?
We are in a decline in lender work because rates are up. It is just another inevitable cycle of boom and bust mortgage lending that started in the 70s when Fannie and Freddie securitized lenders’ loans so they could sell them and get more loans. The volume is driven by refis. Prior to that time it was driven by real estate sales. I have no idea when it will pick up, but rates are forecast to increase. I don’t know when they were this low in the past, going back to the 1930s. They may have been lower prior to the 1930s but there is not enough data to know. There are some people who can’t refi because they don’t have enough equity, couldn’t qualify for a loan, or just never got around to refinancing, etc.

How to get non-lender work?
Many post-licensing appraisers have only worked for lenders. Some even use current lending form reports in court when testifying in court. I have been writing about non-lender work since 1992 in my paid Appraisal Today newsletter. In the October issue of the paid Appraisal Today I will have an article “Quick start for non-lender work”. I also have special reports on Estate, Legal and tax related, and Relocation appraisals ($10 for paid subscribers. $15 for non-subscribers). Or, subscribe and get over 2 years of back issues FREE which cover these topics plus Free Special Reports. See ad below.

Get answers to many of your AMC questions by signing up at  
For unknown reasons appraisers seem to think it is expensive or “too good to be true”. They are wrong. I wrote an article about the company earlier this year for my paid Appraisal Today newsletter.  is free until the end of this year. After that fees are based on how many reviews you contribute. The more reviews, the lower your annual fee. They advertised in my email last week in an ad sent separate from this email. Few appraisers opened their ad. Pathetic. I guess appraisers spend all their time online reading postings from other appraisers, a complete waste of time for getting AMC information. Or, just assume nothing is changing or it will pick back up soon.

Don’t even get me started on appraisers who lost money when AMCs went into bankuptcy because they didn’t know it was coming. There were hints online for months before they tanked. lets you know what is coming.

On the plus side, you made it though the worst appraisal business collapse ever – HVCC in 5/09 when appraisers lost almost all their mortgage broker clients and had to work for AMCs. Many just quit appraising. Today’s slowdown is nothing compared with that time.

To understand AMCs better (beyond the data), purchase my AMC Special Report for $20. Free to paid subscribers.

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Posted in: appraisal, appraisers, forecast

Piano House in An Hui, China

Piano house fotoExcerpt from original article:

 This unique piano house was built recently in An Hui Province, China. Inside of the violin is the escalator to the building. The building displays various city plans and development prospects in an effort to draw interest into the recently developed area.This unusual Piano and Violin shaped building built in 2007 serves as showroom for exhibiting the plans for newly created district of Shannan in Huainan City, China.The transparent Violin houses the escalators and the staircase for the main piano building which displays various plans and development prospects for newly developed area.

 Very interesting. Check out the other fotos!!

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Posted in: Strange homes, unusual home

Fewer appraisers in the future – fees and turn time?

In last week’s email I reported these results:  poll

With few new people currently entering the appraisal profession, do you foresee a shortage of appraisers at some point?

Yes, in the next few years. 2,705 votes 47%

Yes, but it=s probably years down the road. 1,603 votes 28%

No, I don=t think we will see a chronic shortage. 1,137 votes 20%

Not sure. 253 votes 4%

Total votes: 4,818


This is a followup to that poll

As a follow up, do you think the future shortage of appraisers will affect fees and turn times?

Yes, at some point it will. 3403 vote (70.6%)

No, I don’t think it will have much effect. 663 votes (13.8%)

No, I don’t think we will see a chronic shortage. 528 votes (11%)

Not sure. 224 votes (4.6%)

Total Votes: 4,818

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Posted in: Appraisal fees, appraisers, forecast, future

Will there be an appraisal shortage in the future? poll

With few new people currently entering the appraisal profession, do you foresee a shortage of appraisers at some point?

Yes, in the next few years. 2,705 votes 47%
Yes, but it’s probably years down the road. 1,603 votes 28%
No, I don’t think we will see a chronic shortage. 1,137 votes 20%
Not sure. 253 votes 4%

Total Votes: 5,698

Until appraiser licensing 20 years ago, most residential appraisers worked for lenders. When it was busy they hired armies of trainees. When work slowed down many were laid off. With the cyclical fees in AMC work and many lenders not allowing trainees to sign appraisals, it is not financially feasible for fee appraisers to train.

I assume that lenders will allow trainees to sign at some time as the inevitable cycle of weak vs. strong regulations shift. I have no idea when this will happen. This is the easiest way to fix the problem. Low AMC fees when business is slow is more complicated as it reduces the financial incentive for fee appraisers to hire trainees and give them part of the fee.

Posted in: appraisal, appraisers, forecast, future, lender appraisals

Beer can house in Houston, TX

Excerpt from article:
At first, all John Milkovisch wanted in 1968 was a covered patio where he could drink his beer at the end of the day. But a bigger idea was brewing. For years, he had been saving his empty beer cans.

“While I was building the patio I was drinking the beer,” in an interview in 1983. “I knew I was going to do something with them aluminum cans because that was what I was looking for … but I didn’t know what I was going to do.” (Milkovisch died in 1988.)

Over time, Milkovisch’s love of beer and work with his hands — he was an upholsterer — fused into one project. In his retirement, he covered his entire home with beer cans — all different parts, in various shapes and functions. It’s that more than 50,000 cans were used.

My comment: This would be a tough appraisal!!!

Posted in: unusual homes

New Fannie Mae Guidelines 7-30-13

New Fannie Mae Guidelines – 7/30/13


Selling guide

Many thanks to Montana appraiser Doug Smith for this info. Here’s what Doug says:
“Not much new but lenders have to put in QC steps that may increase the review situation. Fannie Mae stated that they have a right to exclude appraisers from appraisals sold to them. I think this is the first time they have put this in writing.”

My comment: It is always good to refer to the most recent version of th Fannie Mae Guidelines. The Announcement has a summary of the changes. I remember back in the “Stone Age” prior to HVCC in 5/09 when all we had to worry about was Fannie Mae Guidelines. Now, every lender seems to have lots of changing requirements that dramatically extend what appraisers have to do.

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Posted in: appraisal

Do your appraisal fees reflect the value of your work product? survey

Do you think the fees you currently accept are indicative of what your work product is actually worth?

Yes, at least in most cases. (15.2%) 826 votes
Not yet, but they seem to be headed in the right direction. (33.6%) 1,821 votes
No, they would have to increase dramatically to meet the current scope of work. (51.2%) 2,774 votes

Total Votes: 5,421

My comment: My fees have always been too low and I don’t even do any AMC work! I just can’t seem to get my billings up to my $100 per hour minimum. Darn!!!

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Posted in: appraisal, Appraisal fees, appraisers

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

Click here to read the full survey results:


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.
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


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.

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Posted in: appraisers