Appraisal News and Business Tips

Posts Tagged bifurcated appraisals

11-29-19 Newz: Choosing Comps – VA and Bifurcated – Most Expensive Homes

By George Dell

Excerpt: This question caused me to rethink the relationship of ‘spiritual’ or ‘mental health’ principles to profitable business practices. From last year’s blog, the research showed benefits with: relationships, physical and emotional health, reduced anger/isolation, sleep, self-esteem, and even improved brain power! Cool.

So, do these things cost me money? Or do they help make more money?

Let’s start with the obvious: what’s in an appraiser’s required belief system: Standards, ethics, and conduct. Recall that USPAP requires you to be worthy. Worthy of belief. Credible.

So, what in that list helps me make more money?

To read more, click here

My comment: Very good appraisal comments for Thanksgiving and the upcoming holidays! Worth reading.

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11-15-19 Newz: Adjustments – Angle Measurements – Zillow iBuying Problems

Accurate Measurements with Odd Angles

Excerpt: Imagine a 2,100 square foot, one and a half story house with an attached garage, porch, and deck. You probably imagined the typical bungalow. Now, imagine that house having 48 corners and only 4 of them are 90 degrees. I recently had an experience with just that house. Some architect, thinking they were Frank Lloyd Wright reincarnated, decided to build this house on a high bank cliff overlooking the Puget Sound. Don’t get me wrong, it was a pretty cool design, but I knew right away when I received the order for that appraisal that I was going to need some help.

To read more, click here Lots of reviews of the product, plus other similar products.

My comment: $19.95. An inexpensive product we all need!! They have been around for awhile, but most appraisers did not know about them. I appraise a lot of Victorians. Very useful!!

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11-8-19 Newz: Zestimates – Fee Transparency – Science and Appraising

National Appraisers Forum

By Dave Towne

Excerpt: Appraisers, if you would like to learn from highly qualified peers (other than me! :), post questions, or offer your own comments, consider joining the FREE group, National Appraisers Forum (NAF). Use this link.

This is one of the best appraiser groups as all commentary is respectful. While not everyone always agrees with certain points, the discussions are not demeaning. There is a wealth of info participants share freely on a wide number of topics. The group has several moderators who monitor the posting activity.

One key point, NAF participants are not anonymous. You must use your name (at a bare minimum) when participating, which is required when signing up… Moderators are asking that anyone who wants to join should give their name as licensed, the state they are in, and their license number.

To read more, click here

My comments: This is my favorite appraiser online group! I get many emails from various sources for this newsletter and have been a member of many online communication places. Before the internet was widely available, I hosted live chats on aol and compuserve. Since then I have watched many online places. Unfortunately, just like any other topic, sometimes the groups end up doing lots of “flaming” (attacking another participants, etc.), negative comments, off topic, politics, etc. I quit going to these places.

Of all the groups I have subscribed to, National Appraisers Forum is the best for me. I have been a member since it started, or soon after. No complaining about AMCs, off topic, trolling and flaming, etc. The founder, Steve Smith, and the moderators keep it this way. Regular contributors are “high end” appraisers with many years of experience. Hot topics are often discussed.

There are well managed appraisal groups on Facebook, but it is too hard to for me to follow the threads, so I don’t go there very often. But, it may work for you.

Another major factor is that you must use your real name, so we know who is commenting. Allowing anonymous postings can easily decay into a mess.

I will be updating my article ” How to connect with other appraisers online. What’s the best group for you? ” in a future issue of the paid Appraisal Today discussing other email chat groups, how to find other groups or start your own, Facebook, etc.

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10-25-19 Newz: Fannie Waivers – No Bifurcates? – Market Cycles

We Don’t Need No Stinking Bifurcates… Do We?

By Tim Andersen, MAI

Excerpt: QUESTION: I’ve heard so much lately about hybrid appraisals. I really don’t understand them. I guess, though, my biggest question about them is whether they are USPAP compliant. Some heavy hitters in appraisal have said they are not USPAP compliant, they pollute the industry, they will degrade us appraisers to the point we are no longer necessary. Some equally heavy hitters have said none of that is true, and that appraisers should be doing them since clients want, to coin a phrase, a painter to paint their house (cheap & fast), not Michelangelo to create an immortal work of art in it (expensive & slow). Since hybrid appraisals do not require me to inspect the property, how can a hybrid appraisal report be USPAP compliant? Do I have to list the inspector in the Certification since inspecting the property is significant appraisal assistance? How are state boards going to look at hybrid appraisals? I do not know what to think. Help!

To read Tim’s answer, click here

My comment: I love Tim’s blog postings. He has been writing articles for the paid Appraisal Today on evaluations, suing state boards, and What’s changed in USPAP 2020-2021? (coming in the Dec. issue) He is definitely a USPAP expert!!

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10-4-2019 Newz: Comp Photos – Waivers – No Permits – Rubik’s Cube

When 1,000 square feet doesn’t count

By Ryan Lundquist

Excerpts: One of the most interesting homes I’ve seen just sold. It was brand new, four stories, and a halfplex. Oh, and on paper it was 3,000 sq ft, but about 1,000 sq ft didn’t count in the square footage. This is definitely a conversation piece, so I’m thankful Realtor Brian McMartin agreed to do a Q&A. I hope this will be valuable and interesting. Any thoughts?

Quick points:

This house has 1,000 sq ft that is not permitted as square footage. The “non-conditioned” space looks just like square footage.

Understanding permits really does matter…

Interview with selling agent plus Ryan’s (and appraisers’) comments. Worth reading.

To read more, click here

My comment: I see non-permitted areas in homes a lot in my city, typically converted basements. Fortunately, I can get the permit info easily from the city and the property owner does not “get into trouble” because of my inquiry. I am lucky.

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9-27-19 Newz: Bifurcated Appraisals and Inspections; Abandoned Resorts – New CA Independent Contractor Law

Crowdsourcing Appraiser Data

By Jerin Harper, IFA, ASA, CREA

Excerpt: Just imagine the possibilities of having a hyper-local database…

If you are not in the business of data you will be out of business. I’m not sure if I heard this somewhere or not, but this mantra has been in my head for a while now. Being in the data business is essential for every business today. We see it across all industries where the companies that embrace data are still in business, and the companies that didn’t make that pivot are out. In our profession we saw Fannie Mae get into the big data business with the creation of CU. CoreLogic took their data business to a whole new level when they bought Alamode. One of my favorite examples is sports: just in the last several years data & analytics have completely changed the way football, basketball, and baseball is played— and those sports have been around for 100 years. It doesn’t matter what business you’re in, you have to be able to capture the right data and communicate it effectively.

I suggest that appraisers start crowdfunding their data.

To read more, click here, plus the many comments,

My comment: A never ending idea… Who “owns” the appraisal data? I remember the days of the CMDC (California Market Data Cooperative) where appraisers, including myself, shared their appraisal data, long before the Internet. It still exists and is owned by FNC. Their historic data is available.

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9-6-19 Newz: Bidding Wars – Dumb Mistakes – U.S. Abandoned Places

Can Smart Appraisers Make Dumb Mistakes?

By George Dell, ASA, MAI, SRA

Excerpt: I am a smart and educated, award-winning appraiser. It is not possible for me to be irrational. Of course not. You can see that. I can see that.

A high IQ and education won’t necessarily protect you from highly irrational behavior—and it may sometimes amplify your errors. David Robson, in an Excerpt from The Intelligence Trap

Oh No! Who is this guy!? Doesn’t he know how smart I am? Why, even my peers have said I am smart. I pride myself on my critical thinking. Even my kids say that! What more proof do you need? Let’s get this straight: I am rational, smart, of high IQ and extremely educated, especially in my chosen field!

Recently, scientists have started to measure what things go with irrationality. There is even a name for this field of study, this measure: dysrationalia. The studies roughly parallel the studies of dyslexia and dyscalculia (difficulty in dealing with number things).

Understandable, Well Written and Interesting!! To read more, click here

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8-30-19 Newz; 99.99% Price Drop – Curious Bathrooms – Amazon’s $105K House

Once listed for $1 billion. Sold for $100,000. What just happened?

Excerpt: A heated court battle, a last-second offer and a sparsely attended auction behind a fountain in Pomona — this chapter of the famed Mountain of Beverly Hills ends not with a princely sum but a sale price more like that of a sports car.

Touted as the city’s finest undeveloped piece of land, the 157-acre property redefined the luxury market when it listed for a record $1 billion last year. On Tuesday, it sold for a mere $100,000 at a foreclosure auction, a fraction of the $200-million loan outstanding on the property.

A markdown of 99.99%, of course, comes with some fine print. Any other buyer would have been on the hook to repay that loan — and this buyer has to eat that loss

To read more, click here

My comment: Quite a story!! Only in LA, of course!! FYI, I am in Northern CA… very different here. We think we are superior to LA ;>

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5-31-19 Newz: Hit the Sales Price – Hybrid Warning – Guitar shaped Hotel

Why do appraisers hit the sales price?

By George Dell

Excerpt: A recent study includes a graph which shows that some 90% of appraisals hit the sale price exactly, or were higher, while only some 10% were below the sale price (when the sale price is known).

Is this a bias on the part of appraisers, or is the bias the cause of the system? What could possibly cause this strong upside skew?

First, ignore the ongoing pressures from the entire ‘loan industry’ to make the loan, make the commission, make the quota, make the bonus, and look successful. Ignore the claimed purpose of the public trust (of our quasi-governmental standards and licensing quagmire).

The goal of protecting the public trust failed, and will fail again— this time with different excuses and blaming— but it will fail again.

Let’s look at some underlying economic truths and social/governmental policy. What economics and public policies come into play here? Three come to mind immediately:

To read the full, very interesting post click here

My comment: When I started my appraisal business in 1986, I was told by local very experienced appraisers to appraise at the sales price or I may be kicked off a lender’s approved list. Of course, since I was trained at an assessor’s office, I was shocked and refused to do this… There was always another lender client I could get.

Dell’s blog has very short posts. My June paid newsletter will have a much longer article written by him: “Old Versus New: Conflict or Opportunity?” It has a brief look into the past, including a photo of an acoustic coupler for connecting to remote sites. Plus, of course, comments on the future! I remember 30 baud transmission rates in the early 1980s connecting from my home PC to my company’s servers;>

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5-17-19 Newz: Dancing and Crooked Houses – Will Appraisals Be Transformed??

Will Fintech Transform/Disrupt Appraisals?

Bifurcated appraisals is the “tip of the iceberg” in changes coming to lender appraisals

I recently attended Jeff Bradford’s excellent presentation on coming changes in the type of valuation used in the residential mortgage industry. I also attended a webinar “New Valuation Trends Disrupting the Industry” that focused on the lender side, especially loan originations. Both saw significant changes coming in the next 5-10 years, going from legacy to digital lending that will transformational.

Both used the term “Fintech” regularly.
Here are two definitions “computer programs and other technology used to support or enable banking and financial services” and “fintech is one of the fastest-growing areas for venture capitalists”. I have written about several VC funded appraisal companies in this newsletter, both residential and commercial, working on new ways to make appraisals more efficient.

Both presentations talked about many ways, such as using AI, photos and data to evaluate interior condition, estimating square footage without measuring, “real time” google earth, etc.

I will be writing about both presentations in the next month’s issue of the paid Appraisal Today.

For more info, google Fintech and mortgage lending and/or Fintech and mortgage lending appraisals. FYI, I did not know what fintech referred to and had to google it after the presentations;>
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