SFR with ADU or Two Units?

How to Identify a Single-Family with ADU vs. Two-Family Property

By McKissock


The presence of an additional living unit can complicate the appraisal process. It may make it difficult for you, the appraiser, to know how to classify the subject property. How do you know whether you’re dealing with an accessory dwelling unit (ADU) or a second unit?

Topics include:

  • ADU meaning and types
  • What is a two-family property?
  • How to tell if it’s a single-family with ADU vs. two-family property
  • It’s more likely to be a two-family property vs. single-family with ADU if:
  • It’s more likely to be a single-family with ADU vs. two-family property if:

To read more, click here

My comments: ADUs have been a controversial topic for a long time in California as state and local governments kept changing their ADU requirements. Finally, what they are and where they can be built became standardized. Today, they are becoming popular to get extra rentals in markets low on housing. Most recently, there is a possible regulation to sell them separately from the main house. Another tricky HBU issue in California!

Check the regulations in your state, county, or city.

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on  non-lender appraisals, VA, flood and fires no insurance, retirement,  few lender appraisals, unusual homes, mortgage origination


$22M Modern Mansion on 130 Acres in Napa Has Its Own Cabernet Vineyard

Excerpts: 6 bedrooms, 6.5+ baths, 7,154 square feet, 130 acre lot

The sprawling property boasts two parcels with a pair of bold, all-white, contemporary homes, situated atop Mount Veeder.

The main “villa” residence has four bedrooms, a wood-paneled library/office, fitness center, and kitchen, as well as living and dining areas.

“When I first drove up to the property, my first response was, ‘Wow, where did this come from?’” recalls listing agent Arthur Goodrich, of Sotheby’s International Realty–St. Helena Brokerage. “I have never seen something this contemporary before in Napa Valley. It looks like a sculpture sitting on top of Mount Veeder. The uniqueness of the homes and the landscape sitting on a hill is just stunning.”

The grounds include more than 8 acres of premium cabernet vineyards and several wells that provide water to the homes and vineyards. The grapes grown here have produced award-winning wines, the listing notes.

To see the listing’s virtual tour and 45 photos, click here

My comments: Definitely a different house for the Napa wine growing area! For many of homes with vineyards, in this area, the vineyards are leased to wine makers to grow grapes. The vineyards have a wide range of sizes.


Mortgage Application Volume Nearing Historic Low
Appraisal Volume Way Down

Excerpts: Per the Mortgage Bankers Association (MBA), the loan application volume is at another low point in our history. The article in Mortgage News Daily titled “Mortgage Application Volume at Lowest Levels Since 1996” in this link provides context.

For a related perspective, the article contains a graph, which can be expanded to show mortgage rates and application volume for decades, from 1971 to today. (Graph above)

Many appraisers, yours truly included, became associated with this profession roughly two decades ago, when rates were going down and appraisal work was increasing. As the graph indicates it’s been a roller coaster ride, but generally speaking up to late in 2021 to early in 2022, it’s been financially rewarding for many appraisers.

Some appraisers, a true minority, have been able to transition to private, non-mortgage-lending appraisal work, but that’s not as easy as some advocate. And many appraisers who only know how to do mortgage lending assignments are reluctant to market themselves outside that confined space. They then become collateral damage recipients that they themselves control.

To read more, click here

To see the original graphs, which can be manipulated, click here

My comments: Why is it so bad now? There were no foreclosure sales needing appraisals! That got me through all the other downturns

I started appraising in 1975 and have been through many ups and downs in mortgage lending in Northern California. This graph includes the worst time for lender appraisers, from 1980 to 1985, with rates over 15%. The GSEs started keeping track in 71. Data before 1971 is minimal.

I am one of the few res appraisers who has always done non-lender appraisals since I started my business in 1986. I had never seen a Fannie form, so all types of clients were new. I did not like lenders telling me how to do my appraisals, so I always preferred non-lender appraisals. I decided what to do.

Half my non-lender work is from my website, set up in 1998, and referrals. The easiest and free way to get online is to set up a Google Business Profile, including a free web page. I have written about them. In some ways, they are better than a website. Your profile can go to the top of the search page.

Some types of non-lender appraisals have little competition, and marketing can be done quickly. You can get them now, such as bail bonds, tax appeals, and private money lending. I have written about all three.

Estate and divorce require heavy networking over time with real estate agents, the primary referral source.

Unfortunately, most res appraisers are unwilling to try new clients where you decide what is in your appraisal reports and what you do in your appraisals. They prefer the AMC Rat Race, I guess.


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The 9th National Risk Assessment: The Insurance Issue. Risk to Home Values.

Source: First Street Foundation

Sept. 20, 2023

Excerpts: The First Street foundation Wildfire Model (FSF-WFM) results reveal that there are huge numbers of properties at risk of rising insurance rates and non-renewals due to the growing risk of wildfires for nearly 4.4 million properties, 23.9 million properties for wind, and 12 million properties for flood across the US not included in FEMA SFHAs.

These millions of properties across the US represent a significant subset of the larger real-estate market which has not adequately priced the cost of climate risk into its valuation. The unrealized climate-corrected valuation gap represents a growing climate bubble which is just starting to be recognized and quantified.

In some cases, this will lead to homeowners foregoing insurance while in all cases, the value of their property will be impacted as the cost of ownership increases with rising premiums. These dynamics are visible in some areas of the country where rates are increasing, and private insurance companies are effectively labeling areas as uninsurable, with state-backed “insurers of last resort” becoming the only option for many homeowners.

Without the ability to insure properties in high risk areas with relatively affordable policies, homeowners will not be able to afford the cost of ownership associated with homes in those areas and property values will deflate, leading to a realization of the current climate-driven overvaluation in the market.

The First Street Foundation’s updated models and the property-specific estimates of risk and loss add to the existing understanding of climate risk across the nation, so that decision-makers may be better informed regarding risk in the current year and 30 years into the future. First Street Foundation makes this property-level information publicly available through its Risk Factor® website, where every property owner may find their Flood Factor®, Fire Factor®, Wind FactorTM and Heat Factor® and the estimated damages associated with their risk. More broadly, this information is available for communities, states, and governments to help inform decisions regarding this wildfire risk so that people, properties, and communities may be adequately protected from climate risks.

To read more and download the full report, click here

My comments: Whether or not appraisers are responsible for verifying that an owner has flood or fire insurance is controversial. I recently read a long email discussion online about it, pros and cons, in the National Appraisers Forum, my go-to place to check out appraisal topics. To join, go to


US Home Insurance ‘Bubble’ Closer to Popping as Climate Risks Mount: Report

September 20, 2023

Source: Insurance Journal

Excerpts: Home insurance costs that have soared in much of the US may get even higher.

Tens of millions of properties around the country are insured at prices that haven’t caught up with the danger of hurricanes, wildfires and floods, according to a new report from the First Street Foundation, a nonprofit that works to define and communicate risks posed by climate change.

“The over-reliance of property owners on the state-run insurers of last resort is a big flashing sign that standard practices in the insurance market cannot keep up with our current climate reality,” said Matthew Eby, First Street’s executive director.

Eby said that when the market correction happens, it will render millions of homes essentially uninsurable and therefore cause their value to drop.

To read more, click here

My comments: Thanks to Robert Wiley from LIA for this interesting article from an insurance publication! The recent fires in Hawaii dramatically illustrate this problem. Warning sirens were set up for tsunamis, which was their prime hazard. However, many knew about the fire hazards from the plants growing in the former sugar cane fields, but nothing was done.

I look out my windows and see a hazardous fire hazard in the Oakland Hills. In 1991, a firestorm leveled over 3,700 homes, and 25 lives were lost. I had appraised many of the homes. After the fire, only the brick chimneys were left. The concrete foundations had been destroyed. It was a small part of the risky area.

Nothing much has been done since then to mitigate the problems. Residents would not pay for any changes. The California state government is trying to get something done about the fire insurance problem.

I am located on an island in San Francisco Bay. Parts of the island are close to the bay water level now, with some flooding with high winds and “king” tides (Extreme tides raising the water level). FEMA rezoned many homes (about 10 years ago) to require flood insurance. What was the local reaction? How can I get out of paying flood insurance by having my place surveyed?

I am above any flood risk and have very low fire risks. My personal risk is earthquakes, as I live 10 miles from two major earthquake faults. I have never seen any effect on values, even if located on top of the fault. Few people will pay for the state policy, with limited coverage and very high deductibles. I pay for it. I have several apps on my cell phone to detect any earthquakes nearby. Maybe I will have 5 minutes warning :<


VA Appraisal Requirements and How to Become a VA Appraiser

By McKissock

Excerpts: If you’re interested in becoming a Veterans Affairs appraiser, you’ll need to learn about VA appraisal requirements and what these assignments entail. You may have questions like, “What obligations do appraisers have when performing a VA appraisal?” and “How is it different
VA appraiser selection

The U.S. Department of Veterans Affairs does not originate or underwrite individual loans, but the VA does select the appraiser who will complete the appraisal for each VA loan. It uses a rotation system to select appraisers to complete appraisals on VA loans in a certain geographic area.

The VA differs significantly from the FHA when it comes to appraiser selection. For FHA, the lender (or the AMC working as an agent of the lender) is permitted to select the appraiser. For VA loans, the VA selects the appraiser, period. The originating lender has no input into who is selected to complete their appraisal.

VA appraisal fees

Another difference is that the VA sets appraisal fees. These are maximum allowable fees which are based on geographic areas. The fee schedule is available on the website of the VA Regional Loan Center (RLC) that has jurisdiction. This is in direct contrast to FHA, which does not set or establish fees. An appraiser may negotiate with the lender or AMC to establish an FHA appraisal fee that is agreeable to all parties; not so with VA.

To read more, click here

My comments: I wrote a long article about this in the past and spoke with many people. Most appraisers were not interested in doing VA appraisals, so I never updated the article.

Many appraisers on the VA panel mention they still have some VA work now.

What those on the VA panel did not like: difficult to turn down work. Difficult to get on the panel. Please be persistent, since it can take a while. The VA panel only opens when the VA Regional Loan Center (RLC)

A few tips: To get started, request a county far away and/or other appraisers don’t want to work there. Location near a military base is a significant plus, as more veterans will live nearby.

VA is the only type of lender appraisal I ever recommend. The VA wants to be sure the veteran has an appraiser to ensure there are no defects and that they did not overpay. I don’t know of any other requested res lender appraisals that do this at all. Appraisers are just deal killers, take too much time, etc. etc.


Iowa Schoolhouse Reimagined as a Luxe Estate $1,750,000

Excerpts: 4 bedroom 5.5+ bath, 13,872 square feet, 3.25 acre lot

According to the Ames Tribune, the school sat vacant for nearly 20 years before Dean and Dianne Jensen purchased it in 2007. After a painstaking renovation of the 13,872-square-foot property, they moved in in 2012. Now,

Built in 1923, the three-story brick structure known as “Prairie Castle” features an eye-popping interior that still pays homage to the school’s legacy. The interior features ceiling heights that soar up to 23 feet, “exposed structural and brick elements,” original maple flooring, and a gymnasium-turned-ballroom. There are four bedrooms, five bathrooms, two full kitchens, and three “morning” kitchens. An elevator offers access to all three floors.

The property receives extra credit for the garage and shop area, which could be used to house equipment or be turned into an art studio.

To read the listing and see lots of photos and virtual tour, click here

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, click here.

Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample go to Or call 510-865-8041, MTW, 7 AM to noon, Pacific time.

My comments: Rates are going up and down. Some appraisers are very busy, and others have little work. Those with non-lender work are keeping busy.


Mortgage applications decreased 1.3 percent from one week earlier

WASHINGTON, D.C. (September 27, 2023) — Mortgage applications decreased 1.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 22, 2023.

The Market Composite Index, a measure of mortgage loan application volume, decreased 1.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 2 percent compared with the previous week. The Refinance Index decreased 1 percent from the previous week and was 21 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 27 percent lower than the same week one year ago.

“Mortgage rates moved to their highest levels in over 20 years as Treasury yields increased late last week. The 30-year fixed mortgage rate increased to 7.41 percent, the highest rate since December 2000, and the 30-year fixed jumbo mortgage rate increased to 7.34 percent, the highest rate in the history of the jumbo rate series dating back to 2011,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Based on the FOMC’s most recent projections, rates are expected to be higher for longer, which drove the increase in Treasury yields. Overall applications declined, as both prospective homebuyers and homeowners continue to feel the impact of these elevated rates. The purchase market, which is still facing limited for-sale inventory and eroded purchasing power, saw applications down over the week and 27 percent behind last year’s pace. Refinance activity was down over 20 percent from last year and accounted for approximately one third of applications. Many homeowners have little incentive to refinance.”

The refinance share of mortgage activity increased to 31.9 percent of total applications from 31.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.5 percent of total applications.

The FHA share of total applications decreased to 14.1 percent from 14.2 percent the week prior. The VA share of total applications decreased to 10.9 percent from 11.0 percent the week prior. The USDA share of total applications increased to 0.5 percent from 0.4 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 7.41 percent, the highest level since December 2000, from 7.31 percent, with points decreasing to 0.71 from 0.72 (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 $726,200) increased to 7.34 percent, the highest level since the series’ inception in January 2011, from 7.32 percent, with points decreasing to 0.78 from 0.80 (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 7.16 percent, the highest level since March 2002, from 7.08 percent, with points increasing to 0.96 from 0.92 (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 6.73 percent, the highest level since July 2001, from 6.62 percent, with points increasing to 1.17 from 1.08 (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 6.47 percent from 6.42 percent, with points increasing to 1.58 from 1.10 (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.

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.


Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
1826 Clement Ave. Suite 203 Alameda, CA 94501
Phone 510-865-8041

NAR Member Survey on Appraisal Data Collectors

NAR  Member Survey on Data Collectors

Excerpts: In May 2023, NAR surveyed its members pertaining to data collectors in the appraisal process. Here are a few of the many survey results.

Survey respondents

Sales agents accounted for the largest proportion, with 45% of participants holding this license. Brokers followed with 24%, and appraisal-certified professionals comprised 14% of the respondents. Broker-Associates and Appraisal Licensees accounted for 13% and two percent, respectively, while the remaining two percent reported holding other types of real estate licenses.

According to the survey responses, the majority of participants (76%) perceive the quality of property data collected by data collectors to be lower than that collected by appraisers themselves. Conversely, 23% of respondents believe that the quality of data collected by data collectors is comparable to that of appraisers.

The survey findings indicate that 30% of respondents reported that a data collector had given them the impression that they were the appraiser or had a role other than merely collecting property data.

Fifty-one percent of respondents expressed safety concerns with the data collection process.

To read more, click here

My comments: Now we know what NAR members think about it. Not very positive. I was surprised at how negative they were. Read the full report. Very interesting. I am working on an article on Hybrid Appraisals for the November issue of Appraisal Today. To me, the big issue is who is doing the inspections. Only appraisers do the appraisals. I see very different levels of inspectors.

Before Covid, I talked with various AMC upper-level managers who were testing it. What they were doing about inspectors had a wide range. They included appraisers, real estate agents, and someone with a week, a month, or online video training. They should definitely not be paid the same. An AMC can offer different levels to their clients, depending on how much reliability their lender customers want or need.

On a more positive side, I have done thousands of drive by appraisals since 1986. I drove by the house and looked at what was nearby, etc. For example, I’m appraising a Victorian built before 1910. There is no way to know what the inside looks like or the foundation (many are brick). Using MLS photos is a joke, as real estate agents don’t take photos of defects. A buyer gets a seller’s disclosure statement for that information. I would be more comfortable if someone used an app that was set up to take specific photos, do floor plan, etc. At least I would have some independent photos.

Data Collectors: Appraisers vs. Uber Drivers

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on  Fannie and state regulators, appraiser inspection training, real estate market, unusual homes, mortgage origination

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NAR Appraiser Survey July, 2023

NAR Appraiser Survey July, 2023

In July 2023, NAR Research conducted a survey of all 9,800 appraiser members and 50,000 randomly-selected residential-focused non-appraiser members.

The survey results had a comparison of 2022 and 2023, which was very interesting.

  • Appraiser Topics
  • Greatest challenges in business
  • Lesser challenges with business
  • Valuations
  • Comfort with valuation tools
  • Radius in which appraisals are conducted
  • Radius by area type (rural, small town, urban, resort, suburban)
  • How often asked to conduct appraisals outside geographic area/Property type of expertise

Sample: Greatest challenges in business

(AMCs) in general among their greatest challenges. This year, this option was broken into three separate AMC-related issues. Forty-four percent cite at least one of these, with 28 percent specifically citing AMC requests for revisions.

This year, however, the single greatest challenge, cited by almost half (47 percent), is “fee pressures,” which, based on comments, is also related in many cases to pressure from AMCs. This is up sharply from 27 percent last year.

One-quarter (26 percent) cite technology fees (not an option in 2022). Appraisers are less likely this year to cite expanding regulations/interpretations of regulations, lender requirements, pressure from real estate agents/brokers, and liability concerns.

The 21 percent who cite other challenges are most likely to cite lack of business/slow market, rising interest rates, low fees, and to reiterate pressure from AMCs.

A very good graphic is included for each section.

To read the report, click here

My comments: Read the appraiser sections in the long report. Fortunately, appraiser results are in the first section. I read the full survey. Most of the questions were for all NAR members, both appraisers and non-appraiser members. Some may be of interest to you. Much of the appraiser results were what we already sort of suspected, but it is good to see actual survey results.

NAR Appraisal Survey 2022

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on  GSE Appraisal Independence Update, Private money lender appraials, ADUs, adjustments, unusual homes, mortgage origination

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Appraiser Salaries

What’s the Average Real Estate Appraiser Salary?

Excerpts: On average, appraisers earn $102,620 a year. However… the average appraiser salary varies significantly across license levels.

Trainee appraisers earn an average annual income of about $53K. Licensed appraisers earn approximately $89K per year. Certified residential appraisers earn more than $101K annually. And certified general appraisers earn the most, making approximately $145K per year.

Like with many professions, the more time you put in, the more your hard work pays off. Average earnings tend to increase the longer an appraiser is in the profession, with the greatest jump being from 0-2 years of experience to 2-5 years of experience. Appraisers who have put in 16+ years in the appraisal industry tend to make the most ($118K), while those who have less than 2 years of experience earn the least ($43K).

To read more and see the charts, click here

My comments: Mckissock results are from their own survey of appraisers. I have seen this type information before, but mostly from contacting companies, recruiters or government databases. Most res appraisers are fee appraisers, but this lets you know the relative income levels based on various factors.

If you’re thinking about upgrading your license, this illustrates the income levels. For example, I do both commercial and residential appraisals, a significant positive factor in my income. When one is slow, I do more work in the other. Of course, if you are only licensed you should upgrade ASAP.

Relatively few residential appraisers have salaried jobs, but they are available at lenders, AMCs, assessors, etc.

My first appraisal job at a county assessor’s office in 1975 paid $900 per month. I would have never become an appraiser without a salaried job. Also, due to “affirmative action” at that time, women were hired for the first time as appraisers at assessor’s offices and lenders. An appraiser I know was hired by FHA as an appraiser trainee. She was previously a secretary. There were few women at my appraisal classes.

Until the early 1990s, when lenders outsourced appraisals to fee appraisers, most res appraisers had staff lender jobs.

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on non lender appraisals, MLS  hacked,  appraisers and real estate agents, Humor,  unusual homes, mortgage origination

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Apps for Appraisers

7 Must-Have Apps for Appraisers

By: McKissock


1. Dragon Anywhere

Dragon Anywhere is a dictation and speech-to-text app that allows you to create, edit, and share documents from your mobile device. This professional-grade dictation service could save you tons of time on typing reports and taking notes in the field. The company boasts a 99% accuracy rate as well as powerful voice editing capabilities. Dragon is very well-liked among appraisal professionals, making it number one on our list of must-have apps for appraisers.

6. Genius Scan

This app gets a lot of love from appraisers. Genius Scan makes it easy to scan, upload, and share documents using your mobile devices. It can even scan handwriting and convert it into text. This tool is excellent for making copies of tax records, floor plans, etc. Over 200 million users and thousands of small businesses are currently using Genius Scan. This app could be a lifesaver for your workfile creation.

To read about the other 5 apps, click here

My comments: Worth checking out. When business is slow is an excellent time to look for new apps, learn how to use your MLS and forms software, etc. etc. Dragon has been around a long time and is popular with commercial appraisers.

Appraisal Business Tips 

Humor for Appraisers

Fannie: Words and Phrases in Appraisals

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NOTE: Please scroll down to read the other topics in this long blog post on non lender appraisals, MLS  hacked, real estate market, UAD redesign and new formats for appraisal reports, unusual homes, mortgage origination

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Appraisers: Be Careful with Your Words

Pesky Words. Keeping Appraisers out of Language Purgatory

Appraisers: Be Careful with Your Words!

by Dave Towne

Excerpts: Appraisers, on July 17, 2023, a document from Freddie Mac was circulated to numerous appraisers around the US which identified certain words and other info that can be considered to be ‘BIASED’ in appraisal reports. Here is the Link to the Bulletin.

We need to step back for a moment and carefully analyze and consider why that was done, and what it means to appraisers.

In many ways, appraisers forget the purpose of the appraisal assignment – which is to value real estate. In other words, the physical structures tied to the land.

But too often, elements of personal or neighborhood demographics or other comments seep into the reports. Maybe not consciously or on purpose, but because appraisers are not critically reading what they write and may not realize the implications of how what they write can be interpreted.

To read more, click here

To read the Freddie document, click here

My comments: Well written and worth reading. Thanks to Dave Towne! I have subscribed to his emails for a long time. To join his list, send an email to requesting to join. I wrote about the July 17 Freddie announcement in this newsletter’s June 16, 2023 issue. Guess it finally got out into the appraiser internet world.

Appraisal Business Tips 

Humor for Appraisers

Fannie: Words and Phrases in Appraisals

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

NOTE: Please scroll down to read the other topics in this long blog post on non lender appraisals, USPAP and Bias, Fannie changes, unusual homes, mortgage origination

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Value of a Pool for Homes?

The value of a pool for Homes?

July 18, 2023 By Ryan Lundquist


Some areas have more pools than others

Real estate is about location. That’s what we always hear. And, it’s true. Homes in different locations and price points tend to have different amenities, and that includes pools. Keep in mind the presence of a pool could be about lot size also – not just the price range.

More pools at higher prices

Here’s a look at the percentage of homes sold with pools by price range in a few local counties. In short, the higher the price, the greater chance of having a pool. This likely has to do with the cost of building a pool, cost of maintaining a pool, and even larger parcels at higher ranges – not to mention buyers at higher price points expecting a pool more often.

NOTE: Does your market look similar?

Adjustments for pools

Last but not least, let’s remember there is no such thing as a one-size-fits-all adjustment for a built-in pool because the value of a pool is going to depend on quality, condition, and even age. But it’s also about location because some price ranges and areas simply expect a pool to be present. In contrast, pools hardly exist in some locations, so it’s less of a factor because buyers don’t expect a pool. Ultimately, let’s look to the comps for the answers. What are buyers willing to pay? The ideal is to find similar homes with and without pools to help us understand that.

To read more and see Ryan’s tables and graphs on pools, click here

My comments: I live in an island city with a “Mediterranean” climate located on San Francisco Bay, which means some fog and moderate temperatures. This week, the highest temperature will be under 70 degrees. About 10-15 miles away, east of the hills, the climate is totally different, with very hot summers. The current high temperature there is about 100 degrees.

Where I live, very few homes have pools. After 35 years of appraising here, the value effect is none. Often, the MLS mentions that the sellers will fill in the pool, but I don’t know if that has ever happened. In dramatic contrast, when I first started appraising “over the hill”, 10-15 miles away where there are many subdivisions, I noticed that in certain neighborhoods, a pool was almost mandatory. I used comps with pools for any homes with and without pools to see any adjustment.

If you are not in an area where this is clear, making pool adjustments can be tough without adequate comps. I have appraised a few homes with pools in areas with few pools. It was tricky.

Pools can be a significant hazard, especially for children. Also, maintenance and heating is a hassle.

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on non lender appraisals, foreclosures way down from 2008, Freddie and ANSI, unusual homes, mortgage origination stats, etc.

click below to read more

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Appraiser Countersues Alleged Discrimination

Appraiser Countersues Black Plaintiffs Who Alleged Discrimination

by Isaac Peck, Publisher WorkingRE

There are now a number of lawsuits facing appraisers where the primary allegation is racial discrimination.

Tate-Austin v. Janette Miller, filed in California in Dec. 2021, was one of the first (and perhaps the most publicized). But since late 2021, a number of similar lawsuits have popped up—from North Carolina to Maryland.

Connolly & Mott v. Shane Lanham et al. is one highly publicized lawsuit covered at length by mainstream media–CBS News, The New York Times, NBC, CNN, ABC News, and more.

Filed in August 2022 in the U.S. District Court of Maryland, Connolly and Mott allege that Lanham discriminated against them and violated professional appraisal standards because of his allegedly “racist beliefs” (among other things).

Mr. Lanham is now countersuing Connolly and Mott for labeling him a racist, making false and defamatory accusations, and causing severe harm to his business, his reputation, and his well-being. Alongside his counterclaim, Lanham has also filed a Motion to Dismiss Connolly and Mott’s initial claim, arguing that they have failed to show any facts that support he discriminated against them.

“Plaintiffs cannot transform allegations of incompetence or a breach of appraisal industry standards into racial discrimination by baldly alleging that Mr. Lanham believed that Plaintiffs did not belong in their neighborhood and that their home was worth less than other homes because of their race. There are no facts alleged in the First Amended Complaint, and none can be alleged with good faith, that Mr. Lanham treated Plaintiffs any differently than homeowners of other races,” the motion reads.

To read more, click here

My comments: Long article and worth reading. Discusses many issues and lawsuits. I don’t write about this topic much. My opinion is that everyone is biased against something. I learned I was biased against young Black men when I was on a criminal jury many years ago.

When a young Black man, the defendant, walked into court, I immediately thought he was guilty. I sent a note to the judge who excused me publically in court. I was very, very embarrassed. But it would have been a lot worse to stay on the jury and vote to convict him. My parents raised us not to be prejudiced against anyone. But I grew up in Tulsa, OK, next to Greenwood, an area of successful Black residents prior to 1921. The Tulsa race massacre occurred on May 31, 1921. I never heard it mentioned by anyone. Older people, who knew about it, never spoke of it. Some newspaper issues were destroyed.

I assume that since I had been appraising in high crime neighborhoods, I became prejudiced. I work hard not to show it. I don’t cross the street when I see a young black man coming towards me, and I smile when we pass, but I do get a little nervous. What is most important is recognizing and not acting on your prejudice.

I have been tempted to lower a value when an owner’s large do dog jumps on me or tries to bite me. But I know I don’t like aggressive large dogs and don’t let it affect my value.

Of course, some appraisers could be biased. But, for residential lender appraisers, there is no advantage to coming in “low” on any residential lender appraisal. You may lose a client.

In the past, appraisers were trained by FHA to redline, with lower values in Black neighborhoods. Appraisal textbooks and classes included this. But, it all changed in the mid-1970s, when I started appraising and was no longer allowed. Hopefully, I would not have become an appraiser working for residential lenders before then because of the obvious bias.

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Fannie: Words and Phrases in Appraisals

What Fannie Says Effective June 29, 2023

Say This, Not That: Words and Phrases to Replace in Your Appraisal Reports

By McKissock

As part of our contributor series, Julie Molendorp Floyd gives tips on how to use more objective language in your appraisal reports ahead of the new Loan Collateral Advisor (LCA) alert messages that will take effect June 29, 2023.

Excerpts: Following that thought process, our appraisal language has simply got to change to reflect current times. In addition, our lenders and GSE’s are implementing tools and programs to identify when “Certain prohibited, subjective or potentially biased words or phrases are included in appraisal reports.”

(Freddie Mac Announcement: “Loan Collateral Advisor: Starting June 29 New Messages Alert Users to Certain Unacceptable Appraisal Practices,” April 28, 2023)

To read, click here

So, if we have the technology and tools to present our conclusions in clearer, fact-based ways, let’s get ahead of the program and make the changes proactively.

None of us enjoy completing revision requests. They take time, effort, and ultimately do not contribute to our bottom line. However, revision requests are part of an appraiser’s life. How can you go about crafting your appraisal report to avoid a revision request for “problematic language” or “unsupported conclusions”? Let’s dive into some words or phrases that should not be included in your appraisal reports and uncover ways to convey your meaning in a compliant, credible way.


  • Moving toward fact-based language
  • Words and phrases to replace in your reports
  • Samples:
  •    Say This     Not That:
  • Within 10 blocks of shopping areas — Convenient to shopping areas
  • Conforms to current market trends — Traditional
  • Primary bedroom, ensuite — Master Bedroom

To read more, click here

My comments: If you do lender appraisals, read this post.

Changes in names is nothing new for appraisers. Since FHA, etc stopped redlining since the 1970s, appraisers have been asked to avoid certain words. Now Fannie’s computers will let lenders know.

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Appraisers: Watch for Concessions and Kickbacks

Concessions, Kickbacks, and the Appraiser’s Nightmare

by Richard Hagar, SRA

Excerpts: What Appraisers Must Do

There are many steps appraisers must follow, more than I can list here. However, you should start off by listing and describing the concessions. Learn how to provide an accurate value conclusion that protects the appraiser from the potential ramifications of their bad acts.

On the first page of FNMA’s form, they ask this question:

“Is there any financial assistance [loan charges, sales concessions, gift or down payment assistance, etc.] to be paid by any party on behalf of the borrower?”

The appraiser has no choice when faced with this question, they must answer and if they get it wrong…then the appraiser is in trouble. After disclosing the information, the appraiser’s next task is to determine how the concessions have impacted the sales price. Federal law, FNMA/FHLMC guidelines and USPAP all point to a solution.

Solutions to Keep You Safe

  • Make sure you have a complete signed purchase contract.
  • In the appraisal, list how many pages of the contract you have in your possession (In case someone is hiding pages from you).
  • List the concessions on page 1 and in the final reconciliation.
  • In the sales grid, list any known concessions that were involved with the purchase of a comparable….

To read more click here 

My comments: Some good tips on how real estate agents try to deal with this. I have known Richard for many years. He is an expert and is a most excellent instructor. I have taken many of his seminars over the years.

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