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This blog has excerpts from my FREE appraiser email newsletter, sent out almost every week since June, 1994. I started with 6 subscribers on Compuserve. Now it is up to almost 14,000 subscribers!! To subscribe to the free email newsletters and get them them when they first come out,, go to www.appraisaltoday.com and sign up in the big Yellow Box!!

I have been publishing a paid Appraisal Today monthly newsletter since June, 1992 with in-depth articles on topics important to appraisers. Click below for more info!!

Japan’s disposable homes

During my morning walks, I listen to podcasts. One of my favorites is Freakonomics Radio (Yes, the same guys that wrote the book)
I recently listed to a podcast where they analyzed Japan’s very unusual home sale market. They consider many homes to last about 20 years (economic life) and then they are demolished and new homes built.
A few excerpts from the summary of the podcast:
It turns out that half of all homes in Japan are demolished within 38 years – compared to 100 years in the U.S.  There is virtually no market for pre-owned homes in Japan, and 60 percent of all homes were built after 1980. In Yoshida’s estimation, while land continues to hold value, physical homes become worthless within 30 years. Other studies have shown this to happen in as little as 15 years.
In the podcast, we look into several factors that conspire to produce this strange scenario. They include: economics, culture, World War II, and seismic activity.
Richard Koo, chief economist at the Nomura Research Institute, has argued in a paper called “Obstacles to Affluence: Thoughts on Japanese Housing” that whatever the rationale behind the disposable-home situation, the outcome isn’t desirable…
My comment: Fascinating and worth listening to!! Very interesting for appraisers, especially.

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How accurate is the reported square footage from the tax records in your primary service area?

How accurate is the reported square footage from the tax records in your primary service area?
3/10/14 poll – www.appraisalport.com
Poll Results
- Very accurate for most homes 869 votes – 16%
- Mostly accurate (about 75% of the time) 2495 votes – 55%
- Hit and miss (about 50% of the time). 1470 votes – 27%
- Not reliable (accurate less than 25% of the time). 475 votes – 9%
- The tax records do not usually show the square footage in my area. 127 votes – 2%
Total votes = 5,346
My comment: AMCs seem to be assuming that tax records are more reliable than appraisers’ measurements. WRONG!! I started appraising at an assessor’s office in 1975. We were no more accurate than any other appraisers and never thought that our square footages were exact.
I used to do a lot of relocation appraisals where 2 or 3 appraisers were hired to appraise the same property. Very, very seldom did the appraisers have the same square footage.
A few years ago, a local real estate agent asked me about an appraisal where the sketch did not match the house. Tax records sq.ft. was way off. The appraiser had “fudged” the dimensions to match public records.
Do many appraisers do this to avoid AMC hassles or they were taught to do this by their supervisors?
I have always looked at tax records sq.ft. as a cross check, but never assumed it was more accurate than my measured sq.ft. In some neighborhoods and cities they are accurate and are very unreliable in other areas as they often are not correct.

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Former appraiser gets first pot license in WA

Excerpt:
His company’s name celebrates being too stoned to get off the couch, and he hopes to bring an ultra-potent “super joint” to market.

Meet Sean Green, chief executive of Kouchlock Productions and the proud owner of Washington state’s first legal-marijuana business license.

Green said he got involved in the industry after his decade-long career as an independent real-estate appraiser dried up. He took $10,000 and started Pacific Northwest Medical in Shoreline in 2011, later expanding to Spokane.

He plans to begin by growing 1,200 square feet of starter plants to provide to other growers as they become licensed. He expects to expand to growing marijuana buds for retail, with 30 to 50 employees. For now, he said he will also continue running his medical operations, though the Legislature is considering whether to bring medical marijuana into the same system as recreational pot.

My comment: I love the creative diversification!! Yes, I do have a California medical marijuana card…

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How many appraisers are left?

I like to use California as it has always included trainees. ASC.gov is ok but includes duplicate licenses.

1994: 16,000 total license appraisers
1999 11,000 total license appraisers
2007 20,000 total license appraisers
2014: 12,232 total licensed appraisers

3,343 certified general appraiser;
6,147 certified residential appraiser;
1,906 appraiser licenses and
836 appraiser trainees.
total 12,232 appraisers

Quite a change up and down. Reflecting the mortgage market, of course!!

Posted by appraiser Roy Villa. Thanks!!

There are still way too many left!!

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VIDEO: What’s Inside This House On Wade Avenue?

VIDEO: What’s Inside This House On Wade Avenue?  (in Raleigh, NC)

Very, very interesting. I find these videos for appraisers but not many people have watched them. This one has 1 million views after it was included in an article and has definitely gone “viral”. Definitely of interest to appraisers also!!

Appraisers’ forecast for biz in 2014

AppraisalPort Polls – 2014 biz forecast
www.appraisalport.com

Do you expect appraisal fees to change in 2014? January 6, 2014
Yes, increase substantially – 384 votes – 7%
Yes, increase slightly – 1,030 votes – 18%
Yes, decrease slightly – 420 votes – 8%
Yes, decrease substantially 230 votes – 4%
No, stay about the same – 3,227 votes – 57%
Not sure – 302 votes – 5%

Total Votes: 5,593

My comment: Looks like the majority of appraisers see stable fees. However, only a few weeks later, I am hearing reports of AMCs dropping fees, especially on broadcast orders.

——————–

I think the business environment for appraisers in 2014 is going to be: (December 30, 2013)
Much better than 2013 – 212 votes – 4%
Better than 2013 – 516 votes – 9%
About the same as 2013 – 1,962 votes – 35%
Worse than 2013 – 1,781 votes – 32%
Much worse than 2013 – 621 votes – 11%
Too early to tell – 548 votes – 10%

Total Votes: 5,640

My comment: Looks like appraisers are unsure about 2014.
They left off my choice – I have no idea!!

Appraisal Today newsletter

Positive Resolution to Chase AppraiserBlacklisting Saga

 Source: WorkingRE

Excerpts:
Nearly two years have passed since Working RE first reported the story of John Dingeman, an appraiser who faced the difficult choice of either violating USPAP’s Confidentiality Section or suffering the wrath of JP Morgan Chase by refusing. Finally, this holiday season, there is some good news to share.

In March 2012, Dingeman refused Chase’s initial request to discuss an appraisal with the bank because of the Confidentiality Section of USPAP.  Immediately following his refusal, Dingeman was placed on Chase’s Ineligible Appraiser List. Chase then filed a complaint against Dingeman with the Arizona Board of Appraisal. The complaint was promptly dismissed and found to be without merit.

The good news? After battling for over a year, Dingeman recently learned that he has been removed from Chase’s “Ineligible Appraiser List.”  He’ll be the first to tell you that it didn’t happen without a fight.

http://www.workingre.com/blacklist-positive-resolution-chase-saga/

My comment: I am not a lawyer and don’t play one on TV, so I don’t know what it means legally. But, it is great to see an appraiser winning!! I do know that many appraisers refuse to work for Chase because of this and many other problems.

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Info on Fannie’s “do not use” appraiser list available

Info on Fannie’s “do not use” appraiser list available

Many thanks to appraiser Dave Towne for sending the email below!!

FannieMae distributed this info below on 1/07/14 ….. shown here just as an FYI, because appraisers cannot access the AQM page.

But you can access the LL-2013-10 which describes some of the negative reporting issues the GSE’s have seen since the UAD was implemented.

Your UAD reports are subject to a higher level procto exam if:
–>you often use the same comp in different reports, but the data you report for that property is different between reports
–>you change the Quality and Condition rating for the same property used as a comp in different reports  (The first time it’s used the Q & C ratings should ‘stick’ thereafter)
–>you are contacted by a GSE reviewer who discusses the above item(s), and you don’t have a credible explanation as to why you have done the above
–>you continue to make the same reporting errors frequently

If you wind up on the GSE’s ‘do not use list’ you are effectively out of business – at least for federally regulated mortgage lending reports.  So “let’s be careful out there!”

Appraiser Quality Monitoring Information
Fannie Mae has published a new web page with information about the recently implemented Appraiser Quality Monitoring (AQM) process. The new AQM web page includes FAQs and a link to the AQM list identifying appraisers whose appraisals will be subject to 100% review by Fannie Mae or whose appraisals are no longer accepted by Fannie Mae. The AQM list is protected content, and approved Fannie Mae sellers/servicers may set up access through Technology Manager.

For more information, refer to Lender Letter LL-2013-10: Appraisal Quality, which reminded lenders of Fannie Mae’s appraiser selection requirements, highlighted several data quality issues, and described the AQM process that Fannie Mae has implemented to identify and monitor issues with individual appraisers.

Direct link to Fannie Appraiser Quality Management (AQM) web page at  http://www.fanniemae.com/singlefamily/appraiser-quality-monitoring

Dave Towne, AGA, MAA                                             towneappraisals@clearwire.net                           www.towneappraisals.comMount Vernon, WA

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What do I think? This can be good for the appraisal profession!

Appraisers have been complaining for years about the “other” appraisers who are unethical, incompetent, lazy, or stupid. For many clients, since licensing, all appraisers are seen as the same. Why not use someone who gives you what you need – turn time, fee, no problems with underwriting, etc.?

Unfortunately, AMC hassles have driven many very experienced appraisers out of the business, or refusing to do AMC work. This makes the problem more difficult.

Maybe more AMCs will start using appraiser quality rather than fee, turn time, etc. to select their appraisers.

Also, the preference by many AMCs for low fees makes it very tempting to skimp on the time and effort for doing appraisals.

A low fee does not mean that you can do a poor job on an appraisal. I know what it is like to work for a low fee. I tried doing low fee jobs a few times over the years, but found I had a really “bad attitude” about the appraisal and had to force myself to do the same appraisal no matter what the fee. Doing a good appraisal is more important to me than using a low fee as an excuse for doing less work on an appraisal.

It is great to see that Fannie is using objective criteria, rather than a reviewer that gives an appraiser a bad rating, removing them from the list of a major lender. Just like appraising, reviewing is subjective. Particularly with the use of reviewers not familiar with your local market.

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