Post No. 35 – First off and most importantly, Happy Holidays to everyone. Be safe, enjoy some down time with family and friends, and here's to a Happy New Year!
Post No. 34 – Some of you may have seen a recent article by Isaac Peck, Associate Editor of WorkingRE. His article was titled "'Low Bid' Appraisal Ordering and Its Effect on Quality." It can be found at this link - http://www.workingre.com/low-bid-appraisal-ordering-effect-quality/
We live in a world where finding out about a product or service before we buy is quick and simple. When we are looking at a potential purchase on Amazon.com or other Internet sites, there are star ratings and reviews to read. Want to try out a new restaurant? Try using Yelp or Google Reviews. Hiring a plumber or house keeper? Angieslist is the place to go. Even fairly obscure companies usually have some sort of grade on the Better Business Bureau’s website to peruse before deciding whether or not to buy. So what about appraisers and appraisal services?
Mortgage volume has slowed down and in-turn appraisal volume has also slowed down. All the major lenders are having huge layoff's as well.
I do pre-foreclosure and home equity work for several clients, and their assignments include some Exterior-From-Street appraisals. Insurance companies and agents request this type of report as well. Recently, I heard from an appraiser who doesn't do "drive-by" Exterior-Only assignments. I understand, as part of managing businesses appraisers make different business decisions related to the nature of the work they will and will not accept. And I'm never about to tell another appraiser what work to accept and what work to avoid.
Dear North Carolina Board of Directors,
First off, congratulations on your appointment for the upcoming year.
I was in attendance at the Chapter meeting in Pinehurst and the subject of Evaluations came up. This has been a pet project of mine for nearly 20 years - i.e. I believe every State should allow appraisers to perform true Evaluations (non-USPAP compliant valuations).
October 29, 2013 - Post No. 32 – In response to a Letter to the Editor in the Summer 2012 edition of The Appraisal Journal, I first mentioned my Theory of Valuetivity. It is summarized as follows:
• Price only equals value when a market is in equilibrium.
• Real estate markets are rarely in equilibrium.
• Therefore, price rarely equals value.
"Paired Sales are a joke" …So some folks say.
Okay, I agree that paired sales are not the be-all and end-all of adjustments, and that there are other methods for supporting adjustments, but the paired sales method really can be valuable.
In the past two years over four AMCs have closed their doors and left appraisers unpaid. Some AMCs have done this in a very deceptive manner while others closed due to legitimate cash flow issues. When an AMCs continues to order appraisals knowing that they will not be able to pay for the work completed this should be looked at as a criminal act. My firm in Chicago has experienced this misfortune multiple times. In some instances we were able to get paid by the lender that engaged the AMC and other times it was a loss for the company.
October 14, 2013 - Post No. 31 – Everyone has probably heard many investment rules. Buy low, sell high. Buy when everyone else is selling and sell when everyone else is buying.
Although everyone knows they should that, the vast majority do just the opposite. It is the ‘smart money’ that actually follows those rules. They buy assets when the public is dumping them. They sell assets when the public can’t buy enough of them.