AQB's latest dumbing down by 'Stakeholders' Dropping the College Degree Requirement

[CGinMN]

Part of being an SA is re-teaching the remedial QE stuff in a real world setting. For some it clicks and they get it right away. Others take 6 months and still don’t understand when you make a negative adjustment when the comp is superior. For those their SA tells them they weren’t cut out for this and they cut em loose. Does PAREA solve this, or does it just keep pushing them along?

 

[CGinMN]

SRAs are a PITA.

 

[Elliott]

So what I'm gathering is there's a problem with SA's. So the solution is to reduce the degree requirement, and that will improve the the profession how? I have no problem with my experience with my SA and to the best of my knowledge, the appraiser I trained doesn't have an issue how she was trained, and we all had college degrees.

So the AQB should correlate SA's with high school and college degrees?

 

[Elliott]

SRAs are a PITA.

You'd complain if hung with a new rope. : )

 

[RCA]

Well, according to at least one of our fellow participants, that is not his fault.

If you required all licensed appraisers to pass the likes of the MAI exam, that would help.

If you also required them to pass a rigorous exam on using MARS regression, that would help.

Then, they would be required to submit 6 reports of complex properties that utilize:

1. MARS regression for the SCA.
2. Cluster Analysis for Neighborhood Definition.
3. Cluster Analysis for price factor aggregation.
4. Direct Capitalization and DCF for the IA.
5. Constraint-based methods for constraining adjustments for unmeasured variables.
6. The use of R or Python for generating value contributions, adjustments and other calculations to create an intermediate Sales Grid.
7. Logical explanations of all methods and reasoning. [ The logic must be valid and withstand criticism.]

 

[chad hampton]

That seems like a lot of work for a $275 AMC report?

If I ran an AMC and paid a professional $275, I'd consider myself lucky if they got the address right.

 

[Mark K]

I can tell you that from my experience wereh I reviewed a good many appraisals post crash ( field reviews of over 300 appraisall over 2 plus years ) that many of these appraisals were over valued. That is in addition to the exotic loans and predatory lending that you mention. The loans with 125% LTV and teaser rates etc paid a huge part, but over valauiotn of some properties by cerratin appraiser played a role as well....

.......

I never said that bad appraisals didn't exist; I know they do. I also know that they didn't cause any of previous crashes and they won't be the cause of the next one(s). They were barely a contributing factor. Poor lending standards including exotic financing vehicles and Wall Street greed caused the last crash.

You should read some of the post-mortem books regarding the last crash. Appraisals are barely mentioned because they weren't the cause.

 

[Non Sequitur]

Well it was not announced until last October. Based on what I saw in a demo, I would not have expected anyone to have finished by now.

The feedback I have heard is that some PAREA students are struggling because they took the lowest cost education available, and do not have the proper technical basis to make it through. The mentors are having to take the students through remedial education.

In the SA model that would not be an issue, because the SA could just tell them to adjust at $40/SF and move on.

Um, which "last" October are you thinking of? The Criteria and Guide Note for PAREA was adopted by the AQB on October 16, 2020 and became effective January 1, 2021. The AI announced their program was approved May 18, 2023 with a registration start of September 2023 after a soft launch with select students over the summer of 2023. That's enough time to have at least one graduate considering what PAREA is supposed to be. As far as blaming "less than" education, the AI didn't have a couple of students with AI QE in the pipeline? Or is that just an excuse the MAIs, who are neck deep in a residential program, are using for trying to cram demo style reports down the throats of aspiring appraisers who have never completed a report?

As I predicted, the AI is treating PAREA like they treat everything residential. It's a mess and the excuses are already rolling in. I have never been worried about AI PAREA for that reason, eventually the AMCs and other vendors will get involved, that's when the gates will open.

 

[djd09]

There sure is quite a bit of discussion on this topic. It would be great if the AQB heard some of it. Their Concept Paper seeks answers to 8 specific questions. Why not take a few minutes and provide the AQB with some reading material?

Concept Paper

Comment Link

On a separate note, it's nice to see my take on the College Degree Requirement acknowledged in the Reference Material provided by the AQB. Although my comment in the 2001 Public meeting of the AQB was made on behalf of NAR, it is also my personal view as an appraiser, and (at that time) as a state regulator. My personal view is still the same. FTR, I do not have a four-year degree.

why dont they come on here and comment...

 

[DWiley]

Um, which "last" October are you thinking of? The Criteria and Guide Note for PAREA was adopted by the AQB on October 16, 2020 and became effective January 1, 2021. The AI announced their program was approved May 18, 2023 with a registration start of September 2023 after a soft launch with select students over the summer of 2023. That's enough time to have at least one graduate considering what PAREA is supposed to be. As far as blaming "less than" education, the AI didn't have a couple of students with AI QE in the pipeline? Or is that just an excuse the MAIs, who are neck deep in a residential program, are using for trying to cram demo style reports down the throats of aspiring appraisers who have never completed a report?

As I predicted, the AI is treating PAREA like they treat everything residential. It's a mess and the excuses are already rolling in. I have never been worried about AI PAREA for that reason, eventually the AMCs and other vendors will get involved, that's when the gates will open.

You may be right on the dates; I did not look it up. Either way, we are not yet at a year for the first group.

I was only telling you what I was told by someone I trust to know what is going on. I am not involved in the AI PAREA program.

I did have the opportunity to see a demo. I was prepared to be disappointed, but it was actually quite impressive. Your characterization of how it works is not consistent with what I saw. As for others getting involved, I have doubts as to how many will. The capital outlay seems must be quite high based on what I saw, and I am not sure any of the for profit education folks could afford to even try. None of them are very big.

If I still owned a firm with trainees, I would definitely enroll them in PAREA and gladly pay the cost. I think the training is that good, and I think it is beneficial to have training come from more than one voice.

How will the PAREA grads perform? Nobody knows. I don't see how they can be much worse that the CR, trained by a SA, who doesn't know how to support the $40/SF adjustment in his own report.