Appraisal News and Business Tips

Mortgage applications

4-18-19 Newz: Strange Bathrooms; Secret Suburbs; Accurate MLS Data?

SUBSCRIBER NOTICE:
Starting next week this email newsletter will be sent out on Fridays.
Why? After 25 years of sending on Thursdays, time for a change! Also, fewer emails on Fridays, so more time to read this newsletter (and not lose it in your inbox) ;>
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4-11-19 Newz: USPAP 2020-2021 – Appraiser Experience – Mortgage Reform

ASB Adopts Changes to USPAP for 2020-21

Excerpt: The current written report options (Appraisal Report and Restricted Appraisal Report) are being retained for 2020-21. One of the more significant revisions is that use of the Restricted Appraisal Report will be permitted when there are intended users in addition to the client. An appraiser will be required to identify these additional intended users by name in the report.

The Foundation will be authoring a Summary of Changes document about the pending revisions to USPAP within the next several weeks. They will also be producing a recorded webinar on the changes. The new USPAP becomes effective on January 1, 2020, so there is still plenty of time to learn about the changes to USPAP before they go into effect.
Click here for the full blog post:

My comment: Many thanks Dan Bradley at McKissock for this blog post! I will be writing about the new USPAP in my paid newsletter, but learned many years ago to wait until a few months before it is adopted. That is when appraisers want to know about it ;>

I never used Restricted Reports because other intended users could not be added. Now I have another reporting option to use.

Read more!!

4-4-19 Newz: Loan Apps Way Up – Straw Bale House – Revised FHA Handbook 4001.1

Tips for choosing comps on a unique home (straw-bale house)

By Ryan Lundquist
Excerpt: It almost sounds like the big bad wolf story, but there really are homes built from straw. Literally. Today I want to mention a few things about this type of construction, share some photos of a local straw-bale house, and then talk briefly about how I approached appraising this one.

Worth reading to find out what Ryan did!!

My comment: Very good tips on appraising unique homes. No lender issues as the appraisal is pre-listing and not for a lender… Sacramento  is a Very Strange place for a straw-bale home!!

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These Locations Were Abandoned Years Ago. Look At Them Today

Excerpt: We’re used to seeing places maintained and kept to a high standard. Usually, we travel to places that are made to look as nice as possible through consistent cleaning and maintenance. But what about the places that are left behind?

Fascinating!! Take a break from appraising and check these out!!

https://www.editorchoice.com/abandoned-places/

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3-28-19 Newz: Adjustments Yes, No, Maybe – 2 Ads – Fannie Update

Woops! Last Wednesday I sent 2 ads at the same time…

My apologies! I have been sending out these ads for about 10 years and never sent out two at the same time.

Two weeks ago I came down with a flu that lasts about 3 weeks. It makes me very tired with a “fuzzy brain”. I did not notice that I had two ads scheduled for the same time.

Now, I check the ad scheduling several times the day before they go out, plus my office assistant also checks them.

I rarely get sick. When I do it is usually for a only a few days, so I was not prepared. Why do I seldom get sick? After over 40 years of appraising homes, I try to never shake hands or touch doorknobs. If I do, I wash my hands as soon as possible. I shook hands with a friend while shopping at a grocery store and did not wash my hands!!

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Fannie Mae Appraiser Update March 2019

Excerpt: What appraisers need to know about property data collection
Topics:
  • Appraisal Modernization
  • Property Data Collection (PDC)
  • Desktop Appraisal
  • Scope of Work and USPAP

Also: Learn how to appraise MH Advantage homes

Read the short update:
Link to Fannie’s Appraiser Page – lots of good info

https://www.fanniemae.com/singlefamily/appraisers

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Read more!!

3-14-19 Newz: Terrible RE Agent Fotos – Appraiser Article in Rolling Stone – Appraisers and Ipads/Tablets

The Property Valuation Reckoning is Imminent

How Technology is Highlighting Underwriting’s Shortcoming

Excerpt: some high-level aspects that can be used to get conversations started.

1. Increasing the availability of detailed, property-specific information, including both operational (ongoing) activities and transactions (sale, refinance, etc.).
2. The collection and analysis of macroeconomic, microeconomic, and capital markets influences that affect the real estate industry.
3. Using concepts such as systems thinking, systems engineering, and advanced technology such as artificial intelligence, machine learning, and deep learning to design semi-automated models that capture and make sense of both property-specific and larger capital markets factors.

Very interesting ideas and analysis. Long, but worth reading. FYI PropTech is a newish acronym. See the next link.

What is PropTech?

My comment: The article gives commercial examples, but is relevant for residential. I have been watching commercial applications, such as AVMs, attempted since the 1990s. The biggest problem is the lack of data. Costar is the major source of data in many areas and has not allowed its data to be commercially used by AVM developers, as far as I know. For leased commercial properties you must have income and expenses, which is not always available. For some types of non-leased properties, such as owner occupied warehouses, AVMs could work well.

Read more!!

1-10-19 Newz: Appraisal Firm Gets $15M VC Funding – Terrible RE Agent Fotos

A Response to: Mortgage Industry Expert Wants to “Eliminate” Appraisers

By Abdur Abdur-Malik
Excerpts: Rather than read the article and shrug, I decided to email the reporter who conducted the interview. I copied a number of the website’s editors and also the industry “expert,” the interviewee herself. Their contact information was available via a simple Google search, so below is an unredacted copy of the email I sent:

My comment: Well written and worth reading. Nothing new, but not the typical appraiser whining and/or ranting. Lots and lots of appraiser comments.
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12-13-18 Newz:// Futuristic Homes / Declining Prices? / Coester?

Futuristic Houses With Some Weird Architectural Designs

Just For Fun!!

Excerpts: You may have watched Transformers, robots that transforms to a vehicle. Well, that’s exactly how these house designs are made. Futuristic? Sure it is. Considering that we need space to build our homes, now we can just take our homes to wherever it is we like. It transforms from a box to a home. How cool is that?

Some of these sleek, weird houses look like they’ve been ripped out of the twenty-second century and some look like they’re from the next millennium. Get ready to move into the freaky saucer homes of tomorrow.

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Fannie Appraiser Update: Special Edition for Rural Appraisal

December 2018

Excerpt: Get tips for appraising rural properties, learn more about our manufactured housing appraisal policy, read about recent appraisal policy updates, and more in the latest Fannie Mae Appraiser Update.

We love hearing from you! Please continue to use the Contact Us form for appraisers to share what’s on your mind and to submit feedback and questions on appraisal topics.

Topics include:
Adjustments, Comps, Cost Approach, etc. tips relevant for most appraisers.
Click here to download the Update PDF
My comment: Even if you don’t appraise rural homes, there are some good tips in this document for all of us! Who never gets a weird house to appraise?
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Education

Read more!!

12-6-18 Newz// Threshold Proposed Increases, Ancient Cave Homes

Proposed appraisal threshold increases keep coming – both residential and commercial !!

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House Republicans Push to Ease Property Appraisal Rules Before Giving Democrats Control
Verification of Real Estate Values Would Drop by More Than Half Under Proposal
Source: Costar

Excerpts:

Republicans in Congress and U.S. financial regulators are proposing to ease appraisal rules for real estate sales financed by credit unions, prompting critics to warn the move could recreate some conditions that fueled the financial crisis more than a decade ago.

The proposals are part of a larger push by the Republican leadership in the House, which will hand over control to the Democrats next month, to roll back financial industry regulations while the GOP is still in charge in that chamber. The National Credit Union Administration is accepting comments until midnight on Monday on its plan to increase the threshold for nonresidential sales to $1 million, which it said would boost the portion of sales not requiring an appraisal to two-thirds of all transactions from 27 percent. About 210,000 commercial property transactions were valued at $1 million or less in 2017, according to CoStar data.

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18 Appraisal Groups send letter opposing credit union new commercial threshold

Excerpt: The letter noted that the federal banking regulatory agencies – the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Federal Reserve Board – earlier this year approved increasing the commercial appraisal threshold from $250,000 to $500,000

“We are deeply concerned the NCUA proposal, if finalized at $1 million for commercial real estate transactions, will result in a regulatory ‘arms race’ between the Agencies and the NCUA,” the letter said. “This would result in the NCUA – the agency with the least direct experience in overseeing business and commercial real estate lending – effectively driving the appraisal policies for the entire financial regulatory system.”

The letter also noted that legislation adopted this year by the U.S. House (and awaiting action by the Senate) would link commercial appraisal threshold levels for two of the U.S. Small Administration’s most popular loan programs to those established by the federal banking regulatory agencies. “This (NCUA) proposal will likely impact not just credit unions and banks, but SBA lenders and risks associated with SBA loans,” the letter said.
The NCUA did not propose changes to the appraisal threshold for residential loans. “We support the NCUA’s proposal to maintain the $250,000 threshold level for residential real estate transactions,” the letter said.
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Sign the Petition!! (residential)

Written by Ryan Lundquist and Jonathan Miller
Almost 3,000 have signed the petition as of yesterday!!

Excerpt:

While the current administration clearly believes in deregulation, this doesn’t sound like a move to protect the American consumer and the United States housing market. As recent experience tells us, it’s going to cost us.

Please sign the petition to send a message to federal regulators that exposing the consumer and taxpayer to unnecessary mortgage risk is not supposed to be their role.
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11-15-18//Newz: – Ball Houses – No Appraisers Left? – Misleading and USPAP

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Bolwoningen Ball Houses

 Excerpt: Bolwoningen consists of 50 sphere houses. The balls are made of cement, reinforced with fiberglass. They are mounted on the base in the form of a cylinder. Each sphere’s diameter is 18 feet and each has 11 round windows. The layout of these structures is quite unusual. In the center of the sphere there is a bathroom and a tiny bedroom, and a living room and kitchen, are located on the second floor-level. The house can be completely disassembled and transported to any other place (the weight of this building is only about 2755 lbs). In addition, this building can be placed not only on the ground, but also on water, on a stationary platform.

Locals didn’t quite appreciate the vision of the architect, but there are plenty of tourists, who would love to visit or even experience living in these futuristic houses.

My comment: Fascinating!! It was built in 1984 and is surrounded by standard homes. Check out the 2 links above and/or google bolwoningen ball houses
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What Would Happen if There Were No Appraisers?

By Tom Horn
 
Excerpt:
7 Consequences of Eliminating Appraisers From Mortgage Transactions
1) Questionable accuracy due to faulty county records
2) No reconsideration of values
3) No critical thinking that takes into consideration nuances of the market

Click here for more commentary and to see the other 4 reasons.

My comment: Very good analysis!! Needs to be sent to all the people who say appraisals are not needed…
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11-8-18 Newz// 8 ft Wide Townhome – Election and Banking Regs – Template Tips

What’s 8 Feet Wide and Has an Elevator? Manhattan’s Tiniest Fancy Townhouse – asking $5 million.

Excerpts: On a cobblestoned lower Manhattan street near the approach to the Brooklyn Bridge, a four-story house is about to go on the market for $5 million. The widest room measures 10 feet.

Small houses have a long history in New York. A Dutch-style gabled house at 75 ½ Bedford St. in Greenwich Village built in 1873 is 9 ½ feet wide. It is “popularly known as the smallest house in the city,” according to the city’s landmarks preservation commission. Its tenants have included poet Edna St. Vincent Millay, and anthropologist Margaret Mead.

My comment: I wonder what an 8 ft wide floor plan, with an elevator, looks like???
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7 Quick Tips for Using Appraisal Templates

Excerpt: Use these tips for proofreading appraisal reports:
5. Proofread Will a few typos or misspellings ruin your appraisal career? Probably not. However, they do seriously undermine your professionalism and suggest that you lack attention to detail. Take the time to ensure you are putting forth polished reports.

Focus on your most recent edits. When you edit something, it’s easy to introduce new errors, such as missing or repeated words. Proof new content and comments two to three times after you edit them, but also home in on those areas again during your final proof.

For more very good tips that we can all use click here:

My comment: I use a few templates for form reports and my assistant has to very carefully check each appraisal I writeup to be sure everything is okay! I gotta make sure I change the effective date of the appraisal and signed dates around the first of the year, of course…
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