appraisal business

Covid-19 Residential Appraisers Tips on Staying Safe

For Covid Updates, go to my Covid Science blog at covidscienceblog.com

Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news!!

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 fees, house settling, unusual homes, mortgage origination stats, Covid tips for appraisers, etc.

Real Estate Agents and Comparable Sales – Tips for Appraisers

By Ann O'Rourke on December 25, 2020 / appraisal business, Coronavirus, COVID, Fannie, fauci, real estate market, unusual homes, USPAP / Leave a comment

Tags: Comps, Fannie, real estate market, unusal homes

Agents and Comparable Sales – Tips for Appraisers

Excerpts: When real estate agents provide relevant comparable sales to appraisers, it certainly benefits both parties. Agents can ensure that appraisers are reviewing comparables that match their properties and, hopefully, meet the seller’s desired price.

Additionally, while appraisers still must verify the information, it can save them time. Here are some dos and don’ts to follow as agents and appraisers work together on establishing comps for appraisal properties.

One of the tips: Don’t go outside the neighborhood

Other neighborhoods may be less or more desirable, and that can affect overall value. Comparable sales should come from only the direct neighborhood in which the house is located—even if that means choosing homes that are slightly smaller or bigger to use as a comparison. Agents should never use sales from a “better” neighborhood to boost the value of an appraisal property.

To read more tips, click here

My comments: All appraisers get comps from agents sometimes. Unfortunately, many are not useful. I always ask if an agent has any sales or listings for me. Agents are often experts in their particular area and know what is happening. Appraisers work in a much wider area usually. Whenever I speak with agents, I tell them how to select comps, especially pending sales, using some of the criteria above.

This does not apply to the sales provided by AMCs, of course, which require a response and often wasted time for the appraiser. Most are generated by computer algorithms or occasionally a review appraiser that knows nothing about the local market.

Covid-19 Residential Appraisers Tips on Staying Safe

For Covid Updates, go to my Covid Science blog at covidscienceblog.com

Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news!!

To read more of this long blog post with many topics, click Read More Below!!

AMC Appraiser Dress Requirements?

By Ann O'Rourke on December 11, 2020 / appraisal business, BATHROOMS, lender appraisals, mortgage loan volume, USPAP, weird homes / Leave a comment

Tags: AMC dress codes

AMC Appraiser Dress Codes?

Excerpt: I recently saw a Facebook post where an appraiser was quite upset and offended that an AMC asked him to dress professionally for an appraisal walkthrough. Now, this

was a request that was made upfront as one of the conditions for accepting the order. Reading the post, it sounded like this appraiser was upset for two reasons. One, he was offended that the AMC was implying that he does not take his job seriously enough or dress professionally enough. Two, he felt like the AMC did not have a right to tell him how to do his job (i.e., how to dress).

First, let me say that I personally do not think it was the AMC’s intention to imply that this appraiser is not professional in any way. I simply think that they were taking extra precautions to make sure the borrower was extremely impressed by the service they, and the appraiser whom they hired, provided. Now, on to the real question. Can an AMC tell an appraiser how to dress? And the answer is yes.

To read more, plus appraiser comments, click here.

My comment: This has always been a controversial topic for fee appraisers. Dustin is correct. An appraiser client can have many requirements, such as requiring a newer car, no flip-flops, etc. It is your decision whether to work for them. Primary Rule: There is always another client!

Covid-19 Residential Appraisers Tips on Staying Safe

For Covid Updates, go to my Covid Science blog at covidscienceblog.com

Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news!!

To read more of this long blog post with many topics, click Read More Below!!

Appraisal highest and best use analysis

By Ann O'Rourke on November 27, 2020 / appraisal business, unusual home / 1 Comment

Tags: appraisal business, unusal homes

The Four Tests of Highest and Best Use

Excerpt:

Legally permissible

You must consider whether any zoning issues or restrictions will prevent building on or improving the lot.

Some questions to answer:

Do you have a current survey of the property? (If not, obtain one, specifically covering boundaries to learn if easements or encroachments exist.)
Are there any deed restrictions?
Are there zoning issues, such as minimum lot size or maximum building height or size?

To read more, click here

My comments: Short and well written with good tips for the four tests. This is particularly important for vacant land and areas that are transitioning to other uses, such as changing from homes to conversion to commercial uses. Appraisal highest and best use analysis is critical.

Many residential appraisers miss these issues as most lender appraisals are for standard properties, such as subdivision homes. You can get into Very Big Trouble by just checking the check box, which is probably already checked on your form template…

Covid-19 Residential Appraisers Tips on Staying Safe

For Covid Updates, go to my Covid Science blog at covidscienceblog.com

Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news!!

To read more of this long blog post with many topics, click Read More Below!!

Time Management for Appraisers

By Ann O'Rourke on October 30, 2020 / appraisal business / Leave a comment

Tags: appraisal business, time management

Time Management – Appraisers Need This Skill

Excerpt: Results of a McKissock Survey

We recently asked our appraisal community, “What ONE business skill does every appraiser need to master?” By far, the most popular answer selection was “delegation and time management.” According to real-life appraisers, several business skills are important. But time management, in particular, is essential for building a successful career in real estate appraisal. Time Management for Appraisers is critical for success.

Delegation & time management (42%)

Others were Project management/Planning, Financial Management, Communication & Negotiation, Networking and Other.

Two of the comments on Time management

“I’ve watched my dad work for himself as an appraiser for the last 10+ years, and everything comes pretty easy to him except meeting deadlines. Organization and time management is key! Don’t let it be your downfall.”

“When researching a subject property, you’ve got to have a good feel for all the time involved—how long will it take to drive to the home, inspect it, research it and complete the report? You’ve got to use all of that information to appropriately plan your days so you meet your clients’ expectations.”

To get the full results and read more appraiser comments, click here

My comment: I have been writing about time management for appraisers since I started my monthly newsletter in 1992. Recently, I have been writing about it a lot as many appraisers are very busy with the refi boom. Every hour saved it an hour you can work on an appraisal and make more money. Or, take a short break!!

The October issue of the paid Appraisal Today newsletter had “Practical tips you can use today for getting more appraisals done and make more money.” The November issue has “Increase your productivity by managing your email”. See more below in my ad.

Appraisal Humor

Appraisal business tips

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How accurate is the reported square footage from the tax records in your primary service area?(Opens in a new browser tab)

What is Included in Appraisal Square Footage?

By Ann O'Rourke on October 23, 2020 / appraisal business, Appraisal fees, square footage / Leave a comment

Tags: appraisal business, appraisal fees, square footage, strange house

Question: Can it count in the square footage?

Roof detail house

By Ryan Lundquist

Excerpts: Can you include it in the square footage? I get questions like this almost every week. Is it okay to count an accessory dwelling in the living area? What about a pool house? How about a man cave or she shed? Let’s talk about this.

The straight dope: It’s tempting to lump something else in the backyard into the square footage, but that’s not appropriate per ANSI measuring standards. Suppose you have to walk outside of the house into something else that is not directly accessible to the house. In that case, we’re really dealing with something that isn’t considered to be a part of the main house…

To read more, click here

My comments: Written for homeowners, but has some good remarks on square footage, such as “lumped square footage” in MLS. What is Included in Appraisal Square Footage can be tricky and controversial. It can also vary by geographic area.

Marketing and Management Tips for Appraisers

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Working with difficult appraisal clients(Opens in a new browser tab)

AMC Fined for Appraisal Order Blast Violation

By Ann O'Rourke on October 16, 2020 / AMCs, appraisal business, appraisal management company, comp photos, Coronavirus, COVID, data, FHA, Freddie, Mortgage applications, unusual homes / Leave a comment

Tags: AMC, AMC fined, comp photos, FHA repairs, mortgage loan volume, strange house

AMC Fined for Appraisal Order Blast Violation

Excerpt: Consolidated Analytics, an AMC based in Anaheim California, was fined $3,000 for violating the Utah AMC Administrative Rules R162-2e-306 “Offering An Appraisal Assignment and Communicating with Two or More Appraisers About a Potential Assignment.

The specific part of this rule that pertains to broadcasting has been relatively effective in reducing the broadcasting of assignments. Clear Capital recently was fined $5,000 for failing to comply and there are additional complaints working their way through the system.

To read more, click here

My comment: Broadcast orders are bad for many reasons for both the AMC and the appraiser: goes to everyone on their list, no considerations about appraiser qualifications for the assignment including geographic. Hundreds of appraisers competing on fees when business is slow make it hard for appraisers to stay in business. There is always someone with a lower fee, in appraising, and any type of business.

When business is strong, such as today, AMCs have to take whatever warm body they can get. Many appraisers are way too booked up and not taking any more work.

Maybe you can get your state appraisal regulator to get a similar regulation!!

Which Appraisal Clients are used the most?(Opens in a new browser tab)

Marketing and Management Tips for Appraisers

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Fact Witness vs. Expert Witness Appraisers

By Ann O'Rourke on October 2, 2020 / appraisal business, appraisal how to, appraisal waivers, COVID, fauci, hybrid appraisals, Mortgage applications, Strange homes, weird homes / Leave a comment

Tags: appraisal waivers, COVID, Expert Witness, Fauci

Excerpts: When a real estate appraiser is called to testify in a court, it could be as one of two types of witnesses. If you are called to testify as an appraiser, it’s important to determine at the time of the request which of the two types you will be: fact witness or expert witness appraisers.

A fact witness is one who testifies only to that of which he or she has firsthand knowledge and who describes only facts (as opposed to expressing opinions). There is no formal definition of a fact witness….

As an expert witness appraiser, you are allowed to express opinions. In fact, your opinions are the very reason for your testimony. The opinions are to be based on the expertise afforded by “scientific, technical, or other specialized knowledge.”

Short and well written. Includes legal references. To read more, click here

My comments: This is a never-ending hot issue for many appraisers. They don’t understand the difference. The difference is you get paid a minimal fee as a fact witness (similar to a witness of an auto accident, for example). As an expert witness, you are paid very well for prep for expert witness testimony, depositions, waiting outside the courtroom, and testifying. I have written about this in my paid Appraisal Today newsletter.

Appraising Weird Stuff is Challenging!(Opens in a new browser tab)

Appraisal Process Challenges

By Ann O'Rourke on September 11, 2020 / appraisal business, appraisal how to, Coronavirus, COVID, fauci, Mortgage applications, unusual home / Leave a comment

Tags: appraisal business, appraisal how to, Coronavirus, mortgage loan volume, strange house

The Most Challenging Part of the Appraisal Process

Appraisal Process Challenges
Excerpts: Number 1: Data analysis (34%)

“When comps are limited, or when sales prices vary by as much as 50% for what appear to be very similar properties in the same neighborhood (which seems to be more and more common in the Denver metro area), selecting the best comparable properties can be a very time consuming and stressful process.”

Number 2. Site value opinion (17%)

“I choose ‘Site Value Opinion’ as the most challenging since there are very few vacant land sales in the areas that I appraise in. With very few sales, it’s very difficult to provide an opinion of value for many sites.”

To read more comments from appraisers and the other 7 challenging parts of the appraisal process click here

My comment: Lots of good appraiser comments. Data Analysis is my number one choice also. Tract homes are sorta boring but can be a welcome break from all the non-tract homes I appraise. Also, with Covid, I don’t connect with real estate agents every week at open houses to find out what is happening (behind the data).

Common Appraiser Violations(Opens in a new browser tab)

What to Do When Your Appraisal Is Under Review(Opens in a new browser tab)

Which Appraisal Clients are used the most?(Opens in a new browser tab)

Should Appraisers Pay to Be on AMC List

By Ann O'Rourke on August 28, 2020 / adjustments, AMCs, appraisal business, appraisal management company, cost approach, COVID, Fannie, fauci, new appraisers / Leave a comment

Tags: adjustments, appraisal business, appraisal management company, Coronavirus, Fannie, mortgage lending, mortgage loan volume, new appraisers, unusal homes

By Dustin Harris

Excerpt: Should appraisers pay to be on an AMC’s approved appraiser list? Is this one way to get new clients? If an AMC solicited you, would you check it out?

Now, I work for some AMCs that, frankly, you might not choose to work for. That’s fine. It’s a choice we all make. Understand that most of the areas I work are rural, so AMCs are generally willing to pay more because of this. Some AMC are very demanding. Yet, when I meet those demands, I get a lot of well-paying jobs from them.

To read more, plus lots of appraiser comments, and listen to the podcast, click here

My comment: A never-ending very controversial topic ever since AMCs took over residential lender appraisals after the mortgage crash around 2008!