Am I being trained properly?

[TerryRohrer]

This makes sense to me, especially after having been in the commercial arena. That was in a way more intuitive for me because the investors were generally concerned with a similar goal - maximizing return.

Residential is harder in that respect, for me at least. I know there is some art to it. What I am being taught right now is, say you have an outdoor feature like a screened-in lanai. Maybe a comp or two have similar lanais that are unscreened. If we think we know the contributory value of the screened-in lanai, any adjustment for there not being a screen is more of small walk-back from the full screened-in lanai (depending on size, condition, quality). I would admit trying to find paired sales on a minor deviation (like a screen v. no screen) is probably not something I would agonize over.

In a nutshell, commercial and income property values are largely driven by people motivated by money, and you can measure money and the flow of money. Conversely, residential real estate is largely driven by emotions, with every participant having their own motivations and baggage, etc. There is a large portion of that motivation that appraisers cannot account for or adjust for, even if you could identify it. It is based on the unique circumstances and outlook of the buyers and/or sellers.

 

[JTip]

Residential appraisers are qualitative, while generals are quantitative.

 

[Zephyr999]

He will get over that the first trip to the state board he makes. It is a very common sanction and if they review your work to get licensed, you will suffer the same fate. Show your work. Go to whatever lengths necessary to find land sales or 'tear downs" (excellent comps for land value)

There was a recent post to this end...about reports sent for licensing not passing/trainee referred for remedial education, license denied.

 

[Terrel L. Shields]

Residential appraisers are qualitative, while generals are quantitative.

As Lenin said, "Quantity has a quality of its own."

 

[GWISC]

I paid a USPAP instructor to review 2 of my reports (with the lender's permission as it told them it was for quality control). The USPAP instructor also did review work for several state appraisal review boards, so I knew he would be critical which is what I wanted. I spent $500. The instructor sent back the reports with his comments of where my reports could use more support and where it needed a bit more narrative and explanation. Overall, he gave me a good grade and told me I had no reason to lose any sleep at night. I read all of his comments and critiques. I used the critiques to make my reports better and stand out. It was $500 well paid.

As for support, it is all within your sales comps. Site size adjustments can be calculated from vacant land sales (land sale price differences divided by site size difference gives you a rough guide on contributory value to surplus land). Survey some sales agents to see what they see the market paying per bedroom, bathroom, 3 car vs 2 car garages etc... It is not perfect, but is acceptable. Put those surveys in a file for reference and throw them into your workfile. Differences in quality and condition can be more subjective.

 

[George Hatch]

Where you can get into trouble with adjustments is if you aren't doing any analysis at all. Anything is better than nothing. Sub-optimal is better than not-attempted. The very worst thing an appraiser can do is say they they did something that they didn't actually do. Don't use the term "matched pairs" unless you actually did matched pairs. Don't say you compared the comps to each other and adjusted that way unless you did it. And so on.

 

[redfish]

Learning how not to do things is good. It forces you to seek out an education on your own.

 

[Mike Ault]

Where you can get into trouble with adjustments is if you aren't doing any analysis at all. Anything is better than nothing. Sub-optimal is better than not-attempted. The very worst thing an appraiser can do is say they they did something that they didn't actually do. Don't use the term "matched pairs" unless you actually did matched pairs. Don't say you compared the comps to each other and adjusted that way unless you did it. And so on.

And don't generate six pages of regression analysis to place in your workfile if you can't point to it and credibly claim that it informed your decision-making process. State boards are not generally hesitant to use evidence in your workfile "against you" when appropriate.

 

[Tiffany Gibbons]

I have been a trainee appraiser working towards Certified Residential for roughly 6 months; my QE is done, and I am fully focused on getting as many experience hours as I can over the coming months. I come to the industry with 20+ years commercial real estate experience, with 4 of those years working under an MAI on in-house valuations and ad valorem tax appeals. I enjoy valuation work.

I was lucky to find a supervisor because a personal friend is Certified Residential and offered to take me on at my request. I am his first trainee. After a number of months of his supervision, I am beginning to question whether I am being trained properly on certain aspects. I'm concerned that I am not learning some of the more, in particular, technical/real life methods properly, but I would appreciate insight from others.

Most concerning to me is that I am not being taught how to properly support adjustments for the sales comparison approach. I have other similar, but more minor concerns that I will not get into at the moment. I have tried to inquire with my supervisor about how to use paired sales and any other techniques (looking beyond the overly simplistic textbook cases) to support adjustments. Instead, I am being taught what his short-hand heuristic approaches are (i.e. adjust X% of cost, flat dollar amounts for various physical features, etc.) that don't deviate much by neighborhood/price point nor are they backed up with much, if anything in the workfile. I have tried to incorporate data analysis with the use of third party adjustment software, but he is distrustful and regularly dismisses the data.

I don't believe he is deliberately cutting corners or trying to do anything intentionally misleading. Rather, the reports go above and beyond in other areas (photos, attachments, descriptions). We review the reports carefully before sending to clients (aside from what I've mentioned). Ultimately though the data/support/application of appraisal methods feels very insufficient and really risky should anything ever be challenged. My gut tells me this isn't ideal, and puts me in a vulnerable position once I am on my own because I've simply learned short-hands.

I'll add that I am grateful for my supervisor taking me on and giving me the opportunity. It has come at a cost to him. Maybe there are re-assuring words from this forum that what I've described is in some part normal in a world where appraisers have to work faster to earn a living? Or, if this is indeed something I should be concerned with, how do I get what I need? Going out and finding another supervisor would be a huge challenge, and I fear it would hurt him personally. I appreciate whatever insight this forum may have.

What sort of commercial "in house" valuations under an MAI and tax appeal work did you do? I'm just curious why you would go the CR route with 20 years of commercial experience, especially with recent developments in residential appraisal. This is coming from one who went through the whole process for a CR, then again years later for my CG.

 

[MrLA]

Yes, you are basically screwed. Good luck.