Smart Appraisers Make Dumb Mistakes?

[Mark K]

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Perfect example is the inability of a human being to address randomness, which can be addressed only quantitatively, because of inherent human bias.

This is why the Apple Ipod had to be reprogrammed not long after its introduction. In random mode, it would sometimes play the same song twice in a row, you know, the way random things happen.

People complained, said 'how could this be random, we don't like it?' Apple re-programmed it to make it less random so you wouldn't hear the same song twice within a certain length of time.

 

[ZZGAMAZZ]

This is why the Apple Ipod had to be reprogrammed not long after its introduction. In random mode, it would sometimes play the same song twice in a row, you know, the way random things happen.

People complained, said 'how could this be random, we don't like it?' Apple re-programmed it to make it less random so you wouldn't hear the same song twice within a certain length of time.

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I'd be content listening to Free Bird song-after-song-after-song.

 

[Terrel L. Shields]

listing agents an opportunity to provide potential comps for my consideration, which they used as the basis of a listing strategy, inevitably results in a long list of properties--none of ever are appropriate comparables (none)

I wonder if Realtors don't vet the appraisers. I live in a small town. The brokers here were people I grew up with or their children. They know better than to jerk my chain. But their insights often make me rethink things as well. Where you have good comps, it is a lead pipe cinch. I know once I was told by a HO whose daughter sold RE in another town that he thought it was worth X dollars. I thought it worth about 2/3rds that. I went to a local broker who had listed the place previously for somewhere between the two opinions. Asked him and he made it plain that I was spot on my analysis that the 6 acres which the frontage was labeled commercial and back half residential with the house (old dated house) and he said, Well it is either 6 acres commercial and the house isn't worth much, or its 6 acres residential with a house...which did I think it was and he told me why the listing didn't sell (no one interested at his price) so I was pretty sure I was on the right track. The HO's daughter then called me to thank me for the report, it was well supported and I basically read between the lines that she had told her father he was somewhat too high already. He didn't complain a bit.

 

[Terrel L. Shields]

Free Bird song-after-song-after-song.

You and my neighbor...he named his farm that. (The chicken farms have to be named so they can sort them all out and they basically have banned the use of letters - no A & B Farms, etc. because of too many duplicates.) No fan of LS myself.

 

[J Grant]

If lenders gave appraisers 2 weeks turn time, paid a big fee so appraiser could turn down other work and focus on the one, "mistakes" would be vastly eliminated and every sale not used could be analysed. But since lenders press for ASAP turn time and fee levels mean appraisers need to take on multiple orders, that is the reality.

"Missing" a sale is not necessarily a mistake. Also, not every sale is supposed to be a comp. But sometimes yes, a sale is pointed out an appraiser overlooked. It's a big messy market and it can happen.

Some things are due to inexperience, which only market exposure will change. Most appraisers come from middle class/working class bg- thus they may be thrown first few times on basic low $ or distress properties, and conversely on a very high $ luxury property. It can take experience to grasp what is considered average and market accepted for eiher end of the spectrum.. Keep in mind most RE agents over the course of career only deal with a limited area / property type. Typically they list/sell in their own community, or specialize- luxury homes or tract homes or starter FHA- but that's it. They may never travel ou tof that area or niche. Yet appraisers are expected to analyze and become rapidly familiar with a wide variety of properties and areas ( even within a county they cover )

 

[ZZGAMAZZ]

I wonder if Realtors don't vet the appraisers. I live in a small town. The brokers here were people I grew up with or their children. They know better than to jerk my chain. But their insights often make me rethink things as well. Where you have good comps, it is a lead pipe cinch. I know once I was told by a HO whose daughter sold RE in another town that he thought it was worth X dollars. I thought it worth about 2/3rds that. I went to a local broker who had listed the place previously for somewhere between the two opinions. Asked him and he made it plain that I was spot on my analysis that the 6 acres which the frontage was labeled commercial and back half residential with the house (old dated house) and he said, Well it is either 6 acres commercial and the house isn't worth much, or its 6 acres residential with a house...which did I think it was and he told me why the listing didn't sell (no one interested at his price) so I was pretty sure I was on the right track. The HO's daughter then called me to thank me for the report, it was well supported and I basically read between the lines that she had told her father he was somewhat too high already. He didn't complain a bit.

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Starting the career, I once called OREA to complain about a Realtor who lied to me to support an inaccurate MLS description. The OREA appraiser said "It's your JOB to review all available information, and to determine what is correct and what isn't. Hardest part about learning the bizz was being brazen enough to ask questions; and I found that the "Columbo" approach is best, regardless of how stupid I might look along the journey, long as the final report is above reproach. [Still learning virtually every day . . . after all these years.]

 

[glenn walker]

Realtors don't lie to appraisers they just report alternative facts and in many cases believe there version. As far as OREA now BREA they do not deal with crybaby appraisers who complain about Realtors and neither does the BRE care about issues like yours. You are the expert and its your job to verify data and there will be many times that you use inaccurate data because Realtors are notorious for over stating or omitting things in MLS . I did an-appraisal last week where the listing showed 4 bedrooms and 2 baths. I get to the property and I couldn't find a second bath, I ask the HO and he says its in the garage. I walk into the detached garage and sure enough it had a 3/4 bath out there. Anyway he said the Realtor told him it would be counted as a 2 bath home. Anyway no big deal I didn't call teh Realtor or complain to some State Board- The Realtor knew that 1 bath homes are hard to sell and in order to get walk through of potential buyers she would list it as a 4 bedroom, 2 bath, and it worked the buyer is planning on adding a second bath after the close of escrow.

 

[Elliott]

I use the "Columbo" method when I'm asking questions. "Say, I noticed some new concrete floor in the basement and a new sump pump, that was certainly professional looking, and just why did you do that?"

There are sharks out there, best to avoid them.

 

[RCA]

I am not sure that USPAP lets appraisers make mistakes in reality...yeah, they claim you can be less than perfect...but...

Can Smart Appraisers Make Dumb Mistakes? - George Dell, SRA, MAI, ASA, CRE

I am a smart and educated, award-winning appraiser. Doesn’t he know how smart I am? Why, even my peers have agree with me.

georgedell.com

The real problem comes as smart people come to assume that they are less vulnerable to bias, simply because they are so educated, experienced, and intelligent.​

The best proof is USPAP itself. It has many errors and was, we might assume, written by "smart" appraisers. But then again, maybe the real problem was that they were not smart enough.

On another note, one thing I discovered along my path of experience, is that going back to correct an old appraisal is fraught with danger. It is surprising how a relatively small change to one part of a report can ripple through other parts of the report. A change in the SCA can impact the CA; so any time you make changes to an old report, you really have to sit down and study the dependencies, before making that change. It is very easy, when your focus is on a more current task, to brush off some requested change to a past report as "minor".

 

[Artemis Fowl]

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I'd be content listening to Free Bird song-after-song-after-song.

Oh. God. No.
Not that they are bad...just that I've heard them 13,000,000,000,000,000,000,000,000,000 times and just can't do it anymore!
Even worse...almost every gig I play BOTH of those are, inevitably, requested. I wanna throw shi...stuff at 'em but everything within easy reach is expensive.

Fun fact! If you throw stuff at an audience they will throw stuff back...and more of it.

EDIT: I musta removed part of my original thought pre-post. Throw Peaceful Easy Feelin into there with Freebird and what I said makes a little more sense. Ironical that I did that in this thread now isn't it?