What’s the appraisal definition for suburban?

Excerpts: The U.S. hasn’t had a formal definition for what constitutes a suburb. A new data analysis comes closer to defining America’s most popular neighborhood type. (Suburban appraisal definition is tricky.) What’s the appraisal definition for suburban?

The United States is a land of suburbs, with just one problem: No one’s quite clear what a “suburb” is.

It’s a question of semantics with real-world implications, as government programs, political campaigns and developers try to spend money in the “suburbs,” where a majority of Americans say they live despite the category having no formal definition.

For some people, it’s obvious: A suburb is a smaller city on the periphery of a larger city. Or it’s a sprawling neighborhood filled with vast swathes of single-family homes. Still other more dated conceptions of suburbia in the popular mind involve the people who live there: allegedly white, middle class and socially homogenous.

Now a new team of researchers believe they’ve cracked the code…

To read more, click here

My comments: Of course, if you do residential lender appraisals this is a Very Big Issue due to lender “requirements” such as no rural properties. Lots and lots of online discussion about this for a long time. Post this topic on your favorite Internet chat site or email list… and wait for the wide variety of opinions!!

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My Favorite Definitions

(This has been floating around for many years…)

Rural  Suburban  Urban

  • If you stand naked on the front porch and the neighbors can’t see you… it’s rural.
  • If you stand naked on the front porch and the neighbors call the cops on you… it’s suburban.
  • If you stand naked on the front porch and the neighbors ignore you… it’s urban.

There are other variations, of course, that are not suitable for this newsletter ;>

Crazy Appraiser Stories!!(Opens in a new browser tab)

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The Sculptured House: An Appraisal Challenge

The Sculptured House


Motoring down the scenic drive west on Highway 70, away from Denver, Colorado, into the foothills and sprawling mountains, an odd structure appears south of the freeway. An oval shape seems to float just above the trees at the top of a cliff, looking at the highway below. It would be understandable to think you’ve spotted a UFO, since the Sculptured House is known for its sci-fi history. The Sculptured House Is An Appraisal Challenge !!

To read more, click here

Appraisal Humor

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

Appraisal Process Challenges(Opens in a new browser tab)

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Covid-19 and appraisals. March 20 2020

March 20, 2020

There are many, many issues which seems to be changing on a daily basis. I wrote this yesterday. There have already been changes I am sure. I am including links to relevant information below

The big refi boom is causing lots of desperate lenders and AMCs trying to find appraisers.

You don’t need more info on keeping safe as it is available all over. What I discuss today is shift from interior inspections to drivebys, forms, what lenders are saying, what real estate agents are doing, the market changes (maybe), liability, etc.

What are lenders and AMCs doing?

Some direct lenders, such as Citibank, are sending out emails about what they recommend. On the other side AMCs are acting like nothing has happened and sending out email blast low fee appraisal request. FYI, it is a lot easier for one lender to change. AMCs work for many lenders.

Info on what Citibank is recommending from VaCAP:

Many are fearful exterior only appraisals will be the end of the traditional appraisal as we know it. Right or wrong, exterior only appraisals are a possibility that may be acceptable in certain situations. VaCAP does not believe it will end traditional appraisals with interior inspections. The profession has been down this road before. It will not fly long term, especially if the market turns downward.

Some lenders are establishing COVID-19 protocols to follow and some have remained quiet on the subject. There are rumors that one lender has instructed appraisers not to inquire as the health of the occupants of the home due to privacy laws. Others like Citibank have developed their own protocol on how appraisers should handle COVID-19 concerns. There is great flexibility to the appraiser. See Citibank’s protocol below:

Worth reading. To read more, click here

Appraisal Business Tips 

Humor for Appraisers

Covid-19 Residential Appraisers Tips on Staying Safe

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

Appraiser Recovers From COVID-19

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Does a Bedroom Need a Window for Appraisals?

Does a Bedroom Need a Window To Be Legal?

Excerpts: Bedrooms are one of those features of a home that sounds good if there are more of them. I get calls all of the time from real estate agents asking if a certain room can be considered a bedroom.

Of course, there are other ways to look at this as well. There are two components to the value of a bedroom including the utility of the room to be used as a bedroom and also the actual square footage that it occupies in the house. Does a Bedroom Need a Window for Appraisals?

To read more, click here

My comment: Written for agents, but very good analysis of relevant market factors plus what building codes say (International Residential Code – IRC). I have an excellent article on bedrooms on the paid subscriber page, with lots of details on different standards, such as FHA. I get questions about what is a bedroom regularly from real estate agents.

Appraisal Humor

Appraisal business tips

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Building A Secure Appraisal Business

Building a Secure Appraisal Business

by Joshua Walitt

Excerpt: Like many of you, I got my start as a real estate appraiser in residential mortgage work. At the time, residential mortgage work was all that I knew, and for a time, all that I thought I could do!

As a residential real estate appraiser focusing heavily on 1004 work, I had blinders on and I had not adequately considered the many, many opportunities available to me. As I developed as a professional, I began to realize that the potential career paths, types of work, and the different roles available to a real estate appraiser vary widely. I think too often as appraisers we severely limit ourselves into what we can or can’t do and define the services we can offer to the marketplace far too narrowly.

The industry is changing, and I like to think of myself as being part of the change, rather than being apart from the change. As appraisers, we each need to ask ourselves: “Do I want to be a part of the change that is taking place in the industry, or will I be apart from it?” Either way, as things change in life and in business (and they will!), we are all faced with a choice about how we will adapt to the changes and overcome the obstacles we encounter along the way. As the appraisal industry continues to evolve and change, it’s important that we appraisers understand that we are capable of providing a very wide range of services in a variety of roles.

For example, here is a list of valuation-related services that appraisers are suited for and can diversify into…

To read more, click here

My comment: worth reading with lots of ideas. I have been writing about this since 1992.

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

Appraisal Humor

Appraisal business tips

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Urban, Suburban, Rural in Appraisals

Urban, Suburban, Rural?

By Tim Andersen, MAI

Excerpt: QUESTION: Can you help me to understand the differences between urban, suburban, and rural? Where I live and work, everything is essentially one big megalopolis for 30 miles in every direction. Therefore, in my reports, I tend to refer to everything as suburban. A reviewer called me on this, but I can’t figure out why. Please set me straight.

ANSWER: At one time, a location was urban if there were high-rise office buildings and no houses close by, suburban if there were merely low-rise office buildings and many houses nearby, and rural if there were no office buildings and lots of farms, ranches, and vacant land close by. However, that was back in the day, so we need new definitions….

To read more, click here

My comment: This is a tricky issue. This post has some good tips. Tim is a regular contributor to the paid Appraisal Today with much longer articles, focusing on USPAP, lender appraising, state board complaints, etc. He reviews lots of lender form appraisals and wants to help appraisers write better reports. More info at https://theappraisersadvocate.com/

10-20 UPDATE: For lots of Covid analysis and news, go to my new covidscienceblog.com

Appraisal Humor

Appraisal business tips

What’s the appraisal definition for suburban?(Opens in a new browser tab)

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6 Reasons Appraisers Are NOT Needed

Appraisers Are NOT Needed???

Excerpt: You can buy a car in little to no time so why not a house? Over the years I have heard that the home buying process is too long. There are too many headaches for buyers and the process should be easier.

We are in a microwave society and everybody wants things instantly. This should, of course, carry over to the home buying process, right?

A house is probably the most expensive purchase people will ever make but that doesn’t mean that the process needs to consume your entire life, right? The appraiser just adds to the stumbling block that most home buyers face in getting into the house of their dreams. Today I am going to discuss 6 reasons that appraisers are not needed (wink, wink) in the home buying process.

Written for home buyers but good explanations for appraisers to use.

To read more click here

My comment: I have appraised many apartment properties. 2-4 unit properties are more difficult to appraise than a 60 unit apartment building, which I appraised recently! Owner occupants, motivations, etc. are big issues. 4 units are the most difficult.

My city has had rent control, which keeps getting stricter, for 4 years. CA recently passed rent control for the state. Must use actual, not market, rents in appraisals. Very, very difficult to appraise. 3 weeks ago I decided not to do them any more.

But, last week a family was thinking about selling their 4 unit property. I pre-screened them. If it had low rents, I don’t know who would buy it. Fortunately the rents were around 80% of market. They wanted to know if it was good time to sell. I told them I would let them know, then do the appraisal. Not a good market now.

I met one of the owners this week at the inspection. He brought a copy of the 2005 date of death appraisal and asked for an “update” or an “evaluation”, for a lower fee, which his sisters requested. I told him I could not do it and did not know any licensed appraiser who would do it. And told him to use a local real estate agent for free. I doubt if they would recommend not listing now as I speak with them regularly at open houses.

Appraisal Humor

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Top Ten Reasons Why It Is Great to be an Appraiser Humor(Opens in a new browser tab)

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What is a Competent Appraiser?

“Damn Right I’m a Competent Appraiser…Aren’t I?”

By Tim Andersen, MAI

Excerpt: To appraise a property, and then report it according to USPAP, is a requirement USPAP demands and the states enforce. All too often, reviewers see in reports boilerplate (especially in the reconciliation) such as: “In my professional opinion, the value of the subject is $XXXXXX”. In the light of competency, look closely at SR1-6(a) and (b), the reconciliation standards rule. What is a Competent Appraiser?

If there is nothing more in the reconciliation than this single (essentially meaningless) sentence, the appraiser has not complied with SR1-5(a) and (b), thus evidenced a lack of competency. In turn, the appraiser certified to a lie, in that, in not complying, the appraiser omitted preparing the report in accordance with Standards 1 and 2 of USPAP. To add insult to injury, the appraiser has violated SR2-1(b) in that the above statement and certification, with no other context or explanation, are misleading. Three serious USPAP violations might stem from these 11-words.

Therefore, relative to the concept of competency, the deeper meaning is that the above 11-words are capable of generating three charges from the state. In addition, they can generate questions from reviewers. When appraisers appraise the property credibly, and then report the results of that appraisal in a non-misleading manner, they avoid both attention from reviewers and from the state. Thus, in turn, they save not only time and money, they show themselves to be competent. They appear more professional. Professionals can and do charge more for their time and efforts, right? Let us, therefore, be professionals.

My NOTE: This blog post starts with USPAP competency standards and includes an analysis of Competency and the Fannie forms Neighborhood section.

To read more, click here

My comment: Tim Andersen is definitely a USPAP Expert! He writes, speaks, teaches classes, etc. on USPAP topics. He also helps appraisers get their appraisals more USPAP complaint. He focuses on residential appraisal issues – state boards, reviewers, AMCs, etc.

Appraisal Humor

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Covid-19 Residential Appraisers Tips on Staying Safe

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7 Ways to Not to Choose Appraisal Comps

By Tom Horn

Excerpt: Here are three of the topics:

1) I’m taking what I think the home is worth based on the owners estimate and looking for sales in this price range

4) Using higher sales from another neighborhood when there are good sales within my own subdivision

6) Using price per square foot

To find out what Tom says and the other 4 ways, click here

My comment: written for real estate agents, Tom Horn’s primary referral clients, but useful for appraisers. Maybe it will help you explain about comps to agents, or why you did not use the comps they provided. I always take whatever sales and listings the agents have. Sometimes the MLS has it miscoded somehow and I miss it. Or, there is a “pocket” listing that sold but was never listed on the MLS. Also, I never want to miss a sale very close to the subject, if only to mention it and explain why I did not use it!! 7 ways to choose comps gives you some ideas.

Appraisal Business Tips 

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Covid-19 Residential Appraisers Tips on Staying Safe

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Join the National Appraisers Online Forum

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 for me to follow the threads, so I don’t go there very often. But, it may work for you. Join the National Appraisers Online Forum!

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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