The Difficulty of becoming an Appraiser Today

[alebrewer]

That would be like $700/week today, which is probably what you should expect to make in your first year, in this market.

Not sure what 'this market' is for you, but there are an awful lot of markets where that's pretty aggressive RN - at least according to what folks say on the forum. Seems to me that most appraisers should still be able to make between $50k and $100k a year fairly easily, so I'm sure the $700/week is not a bad rule of thumb for a newbie. I'd hope it's more, though.

 

[CGinMN]

I am talking about what you should expect to make in your first year in business. It is hard to find even one new direct lender client A) without at least a few years under your belt and B) when they probably aren't adding appraisers. If you are already in business with clients, then yeah I'm sure $50k-$100k is typical.

 

[Terrel L. Shields]

First the current model of entry into getting licensed is antiquated and terrible.

Basically, it was outmoded even when created by the "powers that be" who were convinced that everyone would join AI or become clones of AI under licensing. The advent of the computer (and a few of us recall the days when many appraisers were filling forms with a Selectric) hastened that obsolescence. Your criticism is correct.

Speaking with an engineer in Denver today. He does non-FRT appraisals, and he remarked that he looked into getting certified, but A-the education seemed pointless to his specialty and, B - the scope of his work would be severely limited by the USPAP and state requirements, which he saw as not adding any value to the sorts of appraisals he conducts. Truthfully, he is right and outside of lending, USPAP et al is a hair shirt and pointless waste of brain cells.

Your education and career and business development are entirely on your shoulders. Starting a business and finding clients, especially when you’re green and especially in the current environment, is not easy.

Yes, and self-education is necessary in my book. I see so few appraisal offices with any textbooks. Not general texts and especially not texts on explicit subjects. Books cost money and CE will never educate you. Most CE is geared to keeping regulators off you butt. It does not teach you and the sad fact is FNMA and FHA basically made the decision to toss the cost and income approaches to the sidelines. If you want to do commercial work however, you dang sure better learn both and learn them well starting at a fundamental level of recognizing such simple tenants of the business as valuing land as if vacant and available for its highest and best use. Without that knowledge, you risk incorporating land as if it were a feature of the property instead of buildings being a feature of the land. Buy and learn a specialty or two.

TAF, the Appraisal Institute, etc. are responsible for the atrocious educational system.

The 7 hour CE and 75 hr QE were a sad invention no doubt. And low compensation of this business means investing in education has the same drawback as everything else. You have to budget and skimp with cheapest alternatives, and this very lack of investment in tools, education, and marketing shows in the pocketbooks of most appraisers. But when broke, you are broke and constantly asking yourself the question. "Do I throw good money after bad, or do I struggle until things get better?" It's a choice and often an unanswerable choice.

 

[ReadyFreddie]

Working for other appraisers is difficult because the Fee Appraiser has seen volume drop and is less willing or able to hand off extra if it exist for their business. Some are always scared that you will steal clients as well. I need to go to an AI or a local appraiser meet up to market myself but those meeting are two times a year at most.

The other thing is the education. I need proficiency in more tools than Compared Sales Analysis to handle more complicated appraisals. Conventional loans seem to be something more complicated in one way or another. I would love to know the tricks of the trade to build efficiency using spreadsheets. I am willing to put in the work to be a more advanced and effective appraiser but the education thing is difficult without guidance. I dropped over $1,000 on AI text books recently.

 

[Dublin ohio]

Working for other appraisers is difficult because the Fee Appraiser has seen volume drop and is less willing or able to hand off extra if it exist for their business. Some are always scared that you will steal clients as well. I need to go to an AI or a local appraiser meet up to market myself but those meeting are two times a year at most.

The other thing is the education. I need proficiency in more tools than Compared Sales Analysis to handle more complicated appraisals. Conventional loans seem to be something more complicated in one way or another. I would love to know the tricks of the trade to build efficiency using spreadsheets. I am willing to put in the work to be a more advanced and effective appraiser but the education thing is difficult without guidance. I dropped over $1,000 on AI text books recently.

My mentor was old school and started appraising before licensing. He was also a RE agent. He was more of a wheeler and dealer than an appraiser or agent. An entrepreneur but not a good one. I realized early on that his knowledge was limited and some of his "methods" made no sense. I took it upon myself to gain the necessary knowledge through the typical classes as well as a lot of self study and research. This was before the internet. So it was book study. Luckily I had some good instructors. Including the Hambletons. I have taken some commercial income classes as part of my CE. As far as tools. I taught myself Excel. Although now I use Open Office. There a libraries and other organizations around here that offer free classes on Excel. As far as other software "tools" They are not free and require some investment. Both in time and money. Being only licensed. You may find it difficult to get on many rosters. Since most require a CR now. I am still on most major lender's rosters even though I am only licensed. But that is due to being on them prior to the HVCC etc. But they did pull the rug out from under me when the changed FHA requirements. Event though I had been doing FHA for over 8 years at the time. Regardless good luck

 

[Mejappz]

I would love to know the tricks of the trade to build efficiency using spreadsheets.

Although this might make some on the forum erupt with anger you can take some of Goerge Dell’s classes. They are basic to intermediate you will learn how to use R and some other basic spreadsheet programs. I was helping an appraiser last week who did not know how to export a CSV file from his MLS to a spreadsheet for analysis. That should tell you all you need to know about the state of the appraisal education system.

George Dell's Valuemetrics Appraiser Education

www.valuemetrics.info

 

[CGinMN]

This is my recommended path:
-Read and understand Nelson Bowes “In Defense of the Cost Approach.”
-Learn to use Solomon Adjustment Calculator
-Read and understand David Braun “The Valuation Analyst”
-Learn single and multiple linear regression in excel
-Take George Dell’s class Stats, Graphs, and Data Science
-Understand the fundamentals of market conditions analysis, including market segmentation and seasonality
-For your first few years, interview every agent of every comp you analyze, especially the ones where the data isn’t making sense.
-Have copies of the HUD Handbook and Fannie/Freddie Selling Guides and USPAP on hand and reference them often.
-Try to extract every adjustment in every assignment using at least 2 methods.
-Participate online and try to soak up knowledge on appraisal topics.

Do this over the course of a year or two and you’ll be in a great position to earn business when it becomes available.

 

[Joe Flacco]

This business is tough man. Becoming an appraiser in a bad market is difficult and staying an appraiser in a bad market is also difficult.

 

[Elliott]

North and South Dakota advertise there is a shortage of workers.

Advice that I've relied on: "Its not what happens to you, but how you handle what happens to you." And, "Some days you eat the bear, and somedays the bear eats you." (I spent four months this year getting an insurance company to pay $30K for home repairs they should have agreed to on day 1)

 

[Charles West]

It's like a roofer asked me how to make it in today's real estate market and I told him growth is going to be in AI, forget real estate, real estate has another 8 or so years to go before it begins to decline if it ever does. I told him to invest by dollar cost averaging an equity fund in US technology for the next 10 years. k