Appraisal News and Business Tips

AMCs

6-28-17 Newz// Octagon house craze, Reproducibility Crisis, AMC Technology Efficient?

Octagon House Craze in the 1800s

Excerpt: If you were a forward-thinking individualist in 1800s America, building an eight-sided abode was a great way to show it. The octagon house was a cutting-edge design at the time, believed to be a more efficient use of space, energy, and cost than the conventional square.

… Thousands of these geometric oddities were built by the time the trend hit its peak in the 1860s.

My comment: Wow!! I have never appraised an octagon house, but have seen a few from the outside. Have measured octagon turrets on Victorians.

Top cities where the number of million dollar homes is skyrocketing

Excerpt: In large swaths of the country, a cool million has mostly come to represent the new standard for good, upper-middle-class housing. “In more markets than ever before, the million-dollar mark is the new benchmark for that green lawn and white picket fence,” says Javier Vivas, manager of the realtor.com® economic research team.
  1. Denver CO
  2. Santa Rosa CA
  3. Boulder CO
  4. Truckee CA
Click here get the full list and read the comments on the cities – very interesting!!

My comment: In my small city in the San Francisco Bay Area, with a median price of around $850,000, many properties are listed just under $1,000,000 and sell over list. Starter homes are $750,000 to $800,000 (2 bedroom/1 bath, built before 1940, maybe updated kitchen and bath, 1000 sq.ft.) No, we did not get on the list. Already have too many over $1,000,000.. I am soo glad I bought my  house in 1985 for $135,000!!

Read more!!

6-22-17 Newz//McMansions .Credit Risk Increasing .Freddie – No Appraisals

What If McMansions Ruled the World?

Excerpt: Whether on the gleefully snarky blog McMansion Hell or in haunting photos of cul-de-sacs abandoned during the recession, McMansions-those ersatz chateaux of modern suburbia-are frequent targets of urbanists’ ire, derided as symbols of the wastefulness and isolation of suburban sprawl.
But what if the McMansion could be put in the service of urbanism instead?
My comment: Fascinating!!
——————————————————————-

Appraiserville

Housingwire Gave Appraisers A Long Overdue Win

By Jonathan Miller
Excerpt: After a snarky trying-to-be-coy blog post that tried to win on a technicality that there was an appraiser shortage, many appraisers, including myself, took to the streets (the comments section) to voice our outrage. It was based on an amazingly misinformed Urban Institute post that doesn’t understand the appraiser role in mortgage lending, which was even more infuriating.
Housing Wire’s editor reached out to Jonathan Miller for the appraisers’ side of the story – He handed our long besieged industry a rare “win, include” and I am grateful for his honesty and for the opportunity to voice my view on their platform.

Read more!!

5-25-17 Newz: Lenders’ AMC problems, Arms-length Transactions, Incredible Private Islands

3 incredible private islands

Just for Fun – very short video
A few tidbits
– Locations: Key Largo  (FL), Washington state and Long Island NY
– Space for 110 ft. yacht
– Lowest price: $11 million
– Tennis court that doubles as a helicopter pad

http://www.realtor.com/videos/video-the-ultimate-getaway-you-can-own-one-of-these-3-incredible-private-islands/ac74f30c-de71-43ba-bae1-e54d8336a7ae 

——————————————————————————–

Analyzing the subject’s sales history

By Josh Wailitt
Short video. Worth watching. Check out some of the other videos in his USPAP errors series at www.appraiserelearning.com
———————————————————————————–

Arm’s-Length Transactions, Part 1

Read more!!

5-18-17// Newz, AVM/BPO Problems, Castles in America, Cherry Picking Comps

Castles in America

Excerpts:
Roger Declements likes to build his castles the medieval way.
He starts with stone – up to 1,000 tons of it – and then constructs two parallel walls. After years of work, sometimes an entire decade, these walls add up to what he considers “the most advanced, strongest and most comfortable” abode a person can have.
In the United States, where there are no authentic medieval castles, imitation ones are few and far between. But interest in them has grown, in part because of the popularity of books and shows like “Vikings,” “Downton Abbey,” “Game of Thrones” and the Harry Potter series.

My comment: Very interesting article with good photos plus some info on castles in Europe for comparison. FYI – article is in the New York Times, which only allows a few free articles before requiring a subscription.

——————————————————————

Cherry-picking comps & being connected to the neighborhood

By Ryan Lundquist
Excerpts: On paper it looked like value was going to be so much higher. Why? Because comps to the north were easily 10-20% higher, and even Zillow came in $100,000 above the appraisal (ahem). The big cause of such a legitimately lower appraisal boiled down to one thing. Location. Today I want to show a situation where a small section of the neighborhood was blocked off from the rest, and it was a big deal for value. Have a look below and let me know what you think. Anything to add?
Methodology when only 5 sales in 5 years: When appraising something in this section, there were zero sales over the past 2 years and otherwise only 5 sales in the previous 5 years. This means I had to really study older sales to understand how value works…

My comments: Lots of good ideas. Very well written with good analysis and excellent use of graphs and annotated maps. I regularly go back in the past for comps and analysis. Making market conditions adjustments is very easy. I also use percent adjustments, which tend to be stable over time.

Read more!!

5-11-17 Newz:: Zillow Sued, Value of Views, Portable Architecture

Portable Architecture You Can Roll, Wear, Tow, or Float

A sauna on skis and 11 other dwellings made to move.

Excerpt: Some of the examples are ideal for recreation, such as the compact-cute, California-made Golden Gate 2 camper, with a rounded timber frame, portholes, and a spot for a surfboard. For lovers of winter sports, the Nomad Sauna, which was built on a lake in Norway, includes an internal ice-hole for intensely refreshing breaks from the heat.
It is not all fun and games-others are designed for important, practical use. It can also be used to provide shelter during a crisis, or for protection in extreme weather.
———————————————————————————–

Sleeping lawyer at mortgage fraud trial

Excerpt: A businessman will get a new trial on mortgage fraud charges because his defense attorney was seen sleeping by the judge, witnesses and the federal court jurors who convicted him last year.
U.S. District Judge Donetta Ambrose ruled James Nassida was denied a fair trial because Stan Levenson dozed during the October trial. Levenson has acknowledged that he fell asleep because he was taking cold medicines that made him drowsy.
—————————————————————————-

What are views worth?

To figure out the premium that these vistas can command, the realtor.com® data team compared the prices for all the homes for sale on our site that highlight these sought-after panoramas, and then compared them to similar-size properties in adjacent ZIP codes with no view to speak of.

Here are a few:
4. Chicago, IL: Lake Michigan
Median list price for homes with views: $525,000
Killer view premium: 96.8%

1. Manhattan, NY: Central Park
Median list price for homes with views: $3,795,000
Killer view premium: 39.9%

My comment: Percent of value varies widely. Of course, the total dollar amounts vary even more! I love data!!

Read more!!

5-4-17 Newz .Appraiser Sues Coester. Regression Depression .Google Docs Phishing Scam

Appraiser sues Coester – email hacking

 Source: Appraiserville by Jonathan Miller

With links to court documents
 
Mark Skapinetz v. CoesterVMS.com Inc. and Brian Coester
Excerpt: Do you like to read John Grisham books? I have a story that is much better. It is about a residential fee appraiser in Georgia who filed suit against what the appraisal industry sees as the most notorious AMCs out there and its owner. The appraiser provides compelling tangible evidence with his claim that his email was hacked by the AMC.
… The complaint reads better than “The Firm.”
http://www.millersamuel.com/note/april-28-2017  Scroll down to appraiserville 
 
Dustin Harris Interview with the appraiser:http://appraisersblogs.com/mark-skapinetz-free-appraisers 
More analysis, opinions, and links to documents plus comments
————————————————————————————-

Regression Depression

Why is it so easy? Why is it so hard?

By George Dell, MAI, SRA, ASA

Read more!!

4-13-17 Newz// Desktop Appraisals .Fannie Appraiser Update .Trump Dump Dodd-Frank Regs

Sign up for Fannie’s new Appraiser Update and other appraisal-related news!

How do appraiser-related policy updates, technology changes, and industry trends affect your business? To stay on top of the latest Fannie Mae appraisal news and policies, check out the new Fannie Mae Appraiser Update, a newsletter providing periodic updates for residential appraisers serving Fannie Mae lender customers.  Sign up today to receive the newsletter and other appraisal-related updates.
My comment: I get all the Fannie announcements and have to scroll through them looking for anything relevant to appraisers for this email newsletter. Hopefully, Fannie’s appraiser info will be send frequently. The first newsletter is available.
========================================

Ecological Plastic Bottle House

One family’s mission to exemplify sustainability took on a whole new life as a surprisingly beautiful home.
Excerpt: Alfredo Santa Cruz and his family built the bottle house out of trash and recyclables they collected. Aluminum cans, glass jars, CDs, cardboard cartons, and of course, plastic bottles were all used as construction materials. The house has multiple rooms, and even furniture constructed from all these items.
Scroll down the page to see bottle houses in Michigan, Canada, and Azerbaijan!!
===============================================

Read more!!

3-30-17 Newz: Corelogic Taking Over?, Oldest Living Things, NAR Appraiser Survey

The Oldest Living Things in the World

Fifteen places to find some of the most ancient life on Earth.

Just For Fun ;>

Excerpt:
On every continent on the planet you can find ancient lifeforms that have been living for thousands, or in some cases tens of thousands of years, their lifespans varying wildly depending on the type of organism.
Many of these are trees. Earth is dotted with ancient trees representing the oldest individual examples of their species, the most elderly of which have been around for between 2,000 and 5,000 years, providing food and shade for some of the earliest human civilizations.
But the real longevity champions of the plant world are clonal colonies, a Utah aspen colony is up to about 80,000 years old!
 
My comment: And I thought California’s 4,800 year old bristle cone pine tree was old! This email newsletter would be a lot more boring without atlas obscura!! Somehow uspap, etc. can be sorta boring ;>
==========================================

Corelogic taking over? Lots of data, AMCs, MLS, education…

Excerpt: This morning, as I do every morning, I made some coffee and began work on one of the two appraisal reports that were soon to be due. The first was for an AMC known as Speedy Title and Appraisal Review Services. This appraisal management company is owned by CoreLogic. From their website…

Read more!!

3-22-17 Newz: AQB Degree and Experience .Raise Deminimus? .AMC High Consumer Fees

Are you paying unseen add-on fees for your appraisal?By Ken Harney, nationally syndicated real estate writer

Excerpt: Are you getting fleeced on appraisal charges when you buy a house or refinance? Could you be paying as much as double what the appraiser is receiving for actually doing the work, with the excess going to an undisclosed third party?

Many appraisers say yes. And they’re eager to let consumers know that when the appraisal charge is $500 or $800 or $1,000, they’re frequently being paid just a fraction of that. The rest is going to an “appraisal management” company…
Read the full article here and add your comments:
My comment: Finally, someone is writing about the AMC Consumer Ripoff!! I have been saying since 2008 that the best way to “fight” AMCs is to let consumers know they are getting ripped off!! Appraisers complain about how AMCs treat appraisers and low fees, but don’t seem to focus on consumers, who are paying much more.
————————————————————————–

Read more!!

3-9-17 Newz .Non-lender fees .Mortgage volume since 2013 .AMCs gone wild

Why are barns painted red and the White House white?

Just for fun!! Great short video plus good explanation.
Excerpts: there are some paint choices that never seem to come up for question. Ever wondered why barns are red? Why is the White House white? And is the Golden Gate Bridge supposed to be … gold, instead of a reddish-orange?
My comment:
Also discusses: Why are green rooms green? For musicians, this is where you ‘hang out’ waiting to play. I have never been in a green room painted green ;> Now I know where the name comes from ;>
Click here to watch the short video and read the info below
————————————————————————
Strip-Mall Totems: The Trees of Sprawl
Just for Fun ;>
Excerpt: These forgotten or overlooked trees engage with us on multiple levels, whether we notice or not; they’re full of stories. Many, obviously, were planted – planted to soften a massive hardscape, arrest fresh-bared soil, comply with municipal regulations. A few might be legacy trees from pre-sprawl farmland or prairie copses. Others colonize the sprawl-scape via a bird’s gut or a propitious breeze.
My comment: Strip mall trees will never be the same again for me ;> check out the photos and the comments.
——————————————————————
Valuation Management Group Co-hosts Webinar with Fannie Mae – Collateral Policy & Technology Guidance for Appraisers, March 29 2017
Fannie Mae is presenting a free webinar for residential real estate appraisers on Wednesday, March 29, 2017 at 11 am EST. This webinar will cover collateral policy, technology guidance for appraisers, and the latest information on Fannie Mae’s appraisal policies. Fannie Mae agreed to a second event due to maximum capacity and positive feedback and response to the previous co-hosted event.
Julie Jones, Fannie Mae Credit Risk Analyst will be the presenter, and Jeremy Staudenmaier, also a Fannie Mae Credit Risk Analyst who helped develop the information, will be participating and answering questions. The goal of the webinar is for appraisers to gain a better understanding of Fannie Mae’s mission, to dispel common appraisal myths, and to improve communication with appraisers.

To register,click here:

——————————————————–

What will you do when business really slows down? Start looking for non-lender work when everyone else does?  

It’s a lot easier to get non-lender work when business is strong. There is very little competition. Other appraisers assume/hope/etc. that it will always be busy and do nothing. Lending always goes up and down.
I have been writing about getting non-lender work in my paid newsletter since 1992. For example, I can tell you how to get your business in the top of google search listing at no cost and just a few minutes of time. Half my appraisal business comes from Internet searches.
The two most popular non-lender work for residential appraisers is estate/trust and divorce. Subscribers learn the pluses and minuses of these types of non-lender appraisals and many other types. I have not done any lender work since 2005 and regularly turn down work as I am too busy.
 
If my articles help you get one non-lender appraisal,
it is worth the subscription price!! 
$8.25 per month, $24.75 per quarter, $89 per year (Best Buy)  
or $99 per year or $169 for two years 
Subscribers get, FREE: past 18+ months of past newsletters 
plus 4 Special Reports, plus 2 Appraiser Marketing Books!!
To purchase the paid Appraisal Today newsletter   go to
www.appraisaltoday.com/products  or call 800-839-0227.
—————————————————————————–
How much are you charging for non-lender work?
You should base your non-lender appraisal fees on what local borrowers are paying for their mortgage appraisals. Call around and ask.DO NOT charge what lenders and AMCs pay you. 
I keep hearing about appraisers charging low lender/AMC fees. I have no idea why. If so, they should never complain about low fees again.
My non-lender appraisal fees keep going up and up as borrowers keep paying more and more, due to high demand from lenders. I am still below what they pay, so it seems like a “good deal” to non-lender clients.

I have been writing about non-lender work since 1992 in my paid Appraisal Today newsletter.

====================================
The ugly truth about appraisal fees
By Ryan Lundquist
Excerpt: The Issue: I was asked to appraise something challenging, so I quoted a fee that was higher than a standard fee in Sacramento but still reasonable for the job because the house was funky. Anyway, I was comfortable with the fee and it was accepted by the AMC (Appraisal Management Company) that the lender hired to manage the appraisal ordering process.
But then things got interesting because through the course of the transaction someone showed me an email from the loan officer where I learned the AMC was actually charging the buyer $345 higher than the fee I quoted. What the? That seemed excessive, but the real clincher for me was the email showed a chain of conversation with the AMC where they said I was the one who quoted the much higher fee. Not only was the AMC gouging the buyer in my opinion, but there was a blatant lie that I was the one dictating this fee that was 43% higher than the one I quoted.
Look, I’m not a complainer and I am a total optimist, but this is not okay on so many levels.
My comment: See above for non-lender fees. 
———————————————————————-
Slow Pay AMCs
 by Dave Towne
Excerpt: Through several of the ‘media sources’ I read recently, I’ve learned that “a particular AMC” based on the west coast has a slow pay reputation.
As so often happens with low echelon AMCs with few clients, when business slows down, their payment process becomes a Ponzi scheme. Ultimately they go out of business.
I currently have an outstanding report with that AMC, but the payment due date to me is March 7. So I’m respectfully withholding their name publicly from others, until and unless they don’t pay me on time.
Over past years I’ve written about how appraisers MUST keep close track of their submitted reports and payments due for them. Too many appraisers get busy and neglect to monitor their Accounts Payable for their business.
My comment: A good reminder of AMCs that are in trouble. Read Dave’s suggestions. I am very strict and have loss less than $2,000 in 30 years of fee appraising. It was my fault for poor client screening. I write about this topic regularly in my paid Appraisal Today newsletter, usually when business slows down.
Click here to read plus the many comments.
———————————————————–
AMC Fined for Removing Appraiser from Panel
By Isaac Peck, Editor
Excerpt: Many states also have AMC laws that have stringent requirements that AMCs must notify an appraiser when he or she is removed from an appraisal panel. Unfortunately, the lack of enforcement actions against AMCs for such violations has caused many appraisers to question whether such regulations have any effect at all.
However, in a precedent setting move, the Washington State Department of Licensing has recently become the first regulatory agency to fine an AMC for removing an appraiser from an appraiser panel without proper notification. In September 2015, the American Reporting Company (ARC) was sanctioned for “removing a real estate appraiser from [an] appraiser panel without proper notifications” and failing to “provide [a] real estate appraiser [the] opportunity to respond to removal from panel.”
Click here to read the full article for lots more info, plus the comments from appraisers.
———————————————————
Rules checking software gone wild!!
If the ‘story’ can be told using 3 comps, why are 4 or more really necessary?
By Dave Towne
Excerpt: Interesting report data from review of 1.5 million appraisals. A few of the stats:
– 4.72% of the appraisals Market Value is higher than the adjusted comp values. But real estate is not perfect, and sometimes it does make sense
– 12.10 % of the appraisals use comps from different Cities. And the concern is?
– 6.25% of the reports did not use 5 or more comps. And the concern is??
Be sure to read Dave’s full comments plus the comments at the end from other appraisers:

http://appraisersblogs.com/comps-rules-check-software 

—————————————————————–
Mortgage loan origination volume from 2013 to 2017
This graph has been in every issue of the paid Appraisal Today since 1992. I use the data from the MBA below. Business has been slowing down since the peak in 9/16.
——————————————————————–
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 (see above) every month in my paid Appraisal Today newsletter. 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 8AM to noon, Pacific time.
Mortgage applications increased 3.3 percent from one week earlier
WASHINGTON, D.C. (March 8, 2017) – Mortgage applications increased 3.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 3, 2017. The previous week’s results included an adjustment for the President’s Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 3.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 16 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week to the highest level since December 2016. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index increased 15 percent compared with the previous week and was 4 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to 45.4 percent of total applications from 45.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.7 percent of total applications to the highest level since October 2014. The average loan size for purchase applications reached a survey high at $313,300.

The FHA share of total applications decreased to 11.8 percent from 12.3 percent the week prior. The VA share of total applications decreased to 11.6 percent from 11.7 percent the week prior. The USDA share of total applications remained unchanged at 0.9 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) increased to 4.36 percent from 4.30 percent, with points increasing to 0.44 from 0.38 (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 $424,100) increased to 4.27 percent from 4.23 percent, with points increasing to 0.26 from 0.25 (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 increased to 4.18 percent from 4.07 percent, with points decreasing to 0.32 from 0.37 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.57 percent from 3.51 percent, with points remaining unchanged at 0.36 (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 increased to 3.48 percent from 3.35 percent, with points decreasing to 0.20 from 0.29 (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.

Page 1 of 912345...Last »