An Appraisal Conundrum

Published 12:00 am Saturday, December 10, 2016

My memories of growing up in a small Eastern Oregon town include my father’s love for his emerging career as a real estate appraiser. His talk about property rights, differences in home design and what motivated people to buy and develop land were of great interest. Back in the ‘60s real estate appraising seemed to be a craft that few professionals chose, but I knew it was for me.

As the economy has run its course over the past 40 years, the science of real estate appraisal has grown from adolescence to maturity. In the industry’s youth, appraisers worked for buyers, developers and borrowers with multiple clients needing favors to put together a deal at the bank. Needed changes in the lending world have now built safeguards between those clients and their desired loans. The real estate appraisal process has evolved as recognized procedural flaws required innovative changes. As one pushes “fast forward” to 2016, new challenges have occurred, and market-driven solutions are emerging.

It is clear that during the busy 2016 summer season, when real estate activity peaked, lenders experienced delays in getting a home appraisal, which is needed for bank loans. From an insider’s perspective I’ve seen that today’s appraiser has had to deal with demands for lower fees and faster delivery times while scrambling to meet expanded appraisal requirements plus added layers of review. Appraisal firms are responding with improved automation, careful research and longer work hours when needed to meet looming deadlines. Most appraisers have been hesitant to begin training an appraiser assistant because they recognize a need to slow the work process to allow time for training.

Presently Bend has 85 state-certified appraisers and four registered assistants — a downward shift in both categories from the pre-bubble years of 2004-2008. From my point of view it is easy to see that recession years helped some appraisers to move to new careers. Now, as the market bounces back, firms are beginning to open the doors to hiring registered appraiser assistants with strong qualifications to fill the growing need for help.

Today, the appraiser in training must jump high hurdles including the need to have a bachelor’s degree, pass a series of pre-hire classes and complete a lengthy mentorship program that requires working with the supervision of an appraiser for a minimum of two years.

Donnie Montagner with Beacon Appraisal Group recently hired an assistant and he stated, “As a business owner I recognize that the economic gain from training an assistant is minimal, but I believe that our profession is important and we should strive to train qualified appraisers for this stellar career.”

Montagner’s desire to pay it forward by training an appraiser for future service is driven by the fact that once someone helped him to complete an appraiser-training program.

Nancy Gabert, a lead certified residential appraiser at Bratton Appraisal believes that her team needs to inspire college-age people to consider our line of work, and she is working with two eager professionals who are looking forward to being part of this profession in the generation ahead.

Gabert cites improved appraisal processes and rising fees as reasons that make 2016 the best time to be an appraiser in her 30-year career. She stated, “The cost and time required to secure an appraisal is not a one-size-fits-all formula, but rather determined by the complexity of the assignment. It makes sense that properties considered to be easy to appraise receive low fees and short turn times while appraisals for more unusual homes requiring extended site visits, additional research and expanded analysis will require higher fees.”

Another phenomena that challenges appraisers is summed up in the statement that not all clients are created equal. Service providers tend to embrace work from clients who operate at a predictable, professional level and avoid those who are challenging and insist on an expanded analysis. Every appraiser has a story about an impossible property or an equally challenging client. My advice to those who find it difficult to obtain an appraisal at a reasonable fee and turn time is to treat appraisers like people, consider the file they are working, determine exactly what analysis is needed and communicate clearly.

The appraisal backlog dissipated as the red-hot summer sales season cooled and area Realtors have exhaled a collective sigh of relief. I believe the appraisal industry is showing signs of expanding and will meet client needs and the economic challenges that will face us in 2017.

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