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Old 11-30-2011, 01:49 PM
rolco rolco is offline
Join Date: May 2011
State: Illinois
Professional Status: Certified General Appraiser
Posts: 15
Default wearing two hats (salesperson/appraiser)

Can an appraiser who is a licensed salesperson provide a potential sales customer with a certified appraisal of their property in an ethical manner so as long as the the appraiser discloses in the certification that he/she may have a future interest in the property?

It was always my understanding that under no circumstances could an appraiser act as both an appraiser and sales agent for the same property for the same transaction.

Below are the ethics rules on conduct from USPAP. The two rules in bold seem to contradict each other. The latter of the two seem to suggest that you can do both as long as its disclosed in the certification.

207 An appraiser must perform assignments with impartiality, objectivity, and independence, and
208 without accommodation of personal interests.

209 An appraiser:
210 􀁸 must not perform an assignment with bias;
211 􀁸 must not advocate the cause or interest of any party or issue;
212 􀁸 must not accept an assignment that includes the reporting of predetermined opinions and
213 conclusions;
214 􀁸 must not misrepresent his or her role when providing valuation services that are outside of
215 appraisal practice;
216 􀁸 must not communicate assignment results with the intent to mislead or to defraud;
217 􀁸 must not use or communicate a report that is known by the appraiser to be misleading or
218 fraudulent;
219 􀁸 must not knowingly permit an employee or other person to communicate a misleading or
220 fraudulent report;
221 􀁸 must not use or rely on unsupported conclusions relating to characteristics such as race,
222 color, religion, national origin, gender, marital status, familial status, age, receipt of public
223 assistance income, handicap, or an unsupported conclusion that homogeneity of such
224 characteristics is necessary to maximize value;
225 􀁸 must not engage in criminal conduct; and
226 􀁸 must not perform an assignment in a grossly negligent manner.
227 Comment: Development standards (1-1, 3-1, 4-1, 6-1, 7-1 and 9-1) address the requirement that
228 “an appraiser must not render appraisal services in a careless or negligent manner.” The above
229 requirement deals with an appraiser being grossly negligent in performing an assignment which
230 would be a violation of the Conduct section of the ETHICS RULE.
If known prior to accepting an assignment, and/or if discovered at any time during the assignment,
232 an appraiser must disclose to the client, and in the subsequent report certification:
233 􀁸 any current or prospective interest in the subject property or parties involved;
234 􀁸 any services regarding the subject property performed by the appraiser within the three
235 year period immediately preceding acceptance of the assignment, as an appraiser or in any
236 other capacity.
237 Comment: Disclosing the fact that the appraiser has previously appraised the property is permitted
238 except in the case when an appraiser has agreed with the client to keep the mere occurrence of a
239 prior assignment confidential. If an appraiser has agreed with a client not to disclose that he or she
240 has appraised a property, the appraiser must decline all subsequent assignments that fall within the
241 three year period.

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Old 11-30-2011, 01:50 PM
stefan olafson stefan olafson is offline
Join Date: Apr 2003
Location: Grand Forks, ND
State: North Dakota
Professional Status: Certified General Appraiser
Posts: 2,148

No you can't.
Old 11-30-2011, 02:11 PM
David Wimpelberg's Avatar
David Wimpelberg David Wimpelberg is offline
Join Date: Mar 2005
Location: Hamptons, NY
State: New York
Professional Status: Certified General Appraiser
Posts: 15,827

Originally Posted by rolco View Post
Can an appraiser who is a licensed salesperson provide a potential sales customer with a certified appraisal of their property in an ethical manner so as long as the the appraiser discloses in the certification that he/she may have a future interest in the property?
Theoretically, yes. I'm assuming that there is nothing specific in your state's license law that states otherwise.

Practically, speaking it may not be wise to do so. It is doubtful that the appraiser will be perceived as being unbiased. Also, certain clients, such as a lender, won't accept the appraisal. It could be performed specifically for the potential sales customer, but I wouldn't recommend doing so (misuse of the appraisal, fodder if the relationship with the client goes south, etc.).

In this specific case, if the broker is asked to give an opinion of value, I recommend the broker provide a BPO. Otherwise, recommend another appraiser.
Old 11-30-2011, 02:43 PM
Michael S Michael S is online now
Join Date: Mar 2009
Location: Albuquerque
State: New Mexico
Professional Status: Certified General Appraiser
Posts: 1,139

It may technically be possible to provide both appraisal and brokerage services in an ethical and legal manner. However there is a percieved conflict of interest that can't be overlooked. No matter how impartial you try to be, it's not worth it.

It seems like the compensation for providing brokerage services would be far higher than any possible appraisal fee.
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