UWs are finally calling BS on

[DWiley]

It’s revealing that we have started to use the expression “prove adjustments” as a substitute for “support adjustments”.

The test is not accuracy, but reasonableness. It’s only because the GSE’s demand “accuracy” (their term) of appraisals rather than reasonableness (USPAP) that the “proving” adjustments has even entered the vocabulary of a profession whose product is, after everything is said, an OPINION of value.

Who is the "we" stating that?
It is not possible to "prove" adjustments, only to support them. Supporting them with relevant evidence and logic is what makes them credible.

 

[djd09]

there should be waiver adjustments...

 

[NC Appraising]

It’s revealing that we have started to use the expression “prove adjustments” as a substitute for “support adjustments”.

That's the AMCs and lenders fault.

These GESs wanted us to show support. Not the actual math or calculations. Thats the lenders and AMCs. That is why all of these software companies exploded.

 

[Tawfik Ahdab]

Danny, I was referencing NC Aporaising’s post in this thread where he stated : “We have to prove every adjustment..”.

Let’s not pretend that this is the first time the expression “proving adjustments”has been used in this forum.

If the GSEs demand accuracy then the kind of support they are seeking has to be proof and nothing less.

How do we know something is true, i.e., accurate? By proving it.

 

[DWiley]

Danny, I was referencing NC Aporaising’s post in this thread where he stated : “We have to prove every adjustment..”.

Let’s not pretend that this is the first time the expression “proving adjustments”has been used in this forum.

If the GSEs demand accuracy then the kind of support they are seeking has to be proof and nothing less.

How do we know something is true, i.e., accurate? By proving it.

Support for adjustments has been a GSE requirement for over 20 years. Not new.
Appraisers incorrectly referring to "proof" for adjustments has been going one for as long as there have been appraisers. Also not new.

 

[chad hampton]

there should be waiver adjustments...

Careful, you're going to end up in the same cell as mez.

 

[alebrewer]

The question begs - If an appraiser does not know how to support adjustments, how did they get appraiser credentials?
Were they not taught properly in their classes? Have they just forgotten due to non-use? What is the core issue?

A philosophical question to be sure - and I don't know that soliciting a response from me furthers any kind of solution. Having spent a significant amount of time with the TALCB as both an investigator and mentor, though, my thought is that some folks were never taught these things. I can't tell you how many times I've introduced sensitivity analysis during a training session and the folks were just blown away. They'd never seen it (in practice or otherwise). Same goes for grouped sales analysis. Most have at least heard of paired sales analysis - but don't really know how to employ it. Don't even mention regression - eyes start glazing over, mouths start drooling, etc.

In answer to your question, though: in my opinion, they 'trained' to take (and pass) a test. They weren't trained on how to actually 'do' an appraisal. They weren't trained properly in the classes, because most CE schools are primarily concerned with turning a profit - not in educating appraisers. They have not forgotten - they never had the knowledge in the first place. The core issue is: the appraiser training system is broken - and has been since initiation of the appraiser credential in 1989.

I know I'm in the minority RE PAREA, but IMO - ANYTHING is an improvement to the broken POS training system we've had in place for the last 3 decades. Appraiser training should be done by professional trainers who aren't motivated by profit, but by the desire to impart useful knowledge. How do we do that? I have no idea.

 

[alebrewer]

I’ve never taken a class that offered a real world example of how to derive adjustments. I’m talking about a situation where they give you a real house, go through the MLS search for comparables, throw everything into the Borg and show you how it magically spits out five adjustments to put on a grid.

What I have done is in a QE class 25 years ago had an example of two identical homes where one had a two car garage and the other had a one car garage that both sold on the same day and one sold for 5000 more. Therefore, the garage adjustment was 5000. That’s the extent of education.

Learning adjustments doesn’t come from education, it comes from years or decades of real world experience working in a particular geographic area.

I learned more about how to do the field appraisal inspection in my classes than I did learning how to make adjustments.

case in point.

 

[Tom D]

They need to throw out one of this founding appraisal book. It has a comment about proving adjustments. Burn this witch's comments.

The Appraising Residential Properties, 4th Edition, Appraisal Institute, "Other Quantitative Adjustment Techniques”, Page 344 further states: “…In instances where paired sales analysis is not conclusive, the appraiser may apply judgment to resolve the problem." The adjustments resulting from the appraiser's judgment is based on a study and understanding of historic or past buyer preferences. It further suggests that cost and depreciated cost data may be used with the appraiser arriving at the value contribution (not cost new) of certain features. The process of supporting the contribution of individual variables (features) is limited and often difficult to quantify, with adjustment deemed to be qualitatively supported unless otherwise addressed. All methods of supporting adjustments are usually limited by inherent uncertainties within the applications themselves.

My final comment: Burn uad3 at the stake, it will be a false prophet of exact proven adjustments. Either that, or we will be burned. Soon USPAP will change the definition from opinion of value, to fact of value.

 

[NC Appraising]

A philosophical question to be sure - and I don't know that soliciting a response from me furthers any kind of solution. Having spent a significant amount of time with the TALCB as both an investigator and mentor, though, my thought is that some folks were never taught these things. I can't tell you how many times I've introduced sensitivity analysis during a training session and the folks were just blown away. They'd never seen it (in practice or otherwise). Same goes for grouped sales analysis. Most have at least heard of paired sales analysis - but don't really know how to employ it. Don't even mention regression - eyes start glazing over, mouths start drooling, etc.

In answer to your question, though: in my opinion, they 'trained' to take (and pass) a test. They weren't trained on how to actually 'do' an appraisal. They weren't trained properly in the classes, because most CE schools are primarily concerned with turning a profit - not in educating appraisers. They have not forgotten - they never had the knowledge in the first place. The core issue is: the appraiser training system is broken - and has been since initiation of the appraiser credential in 1989.

I know I'm in the minority RE PAREA, but IMO - ANYTHING is an improvement to the broken POS training system we've had in place for the last 3 decades. Appraiser training should be done by professional trainers who aren't motivated by profit, but by the desire to impart useful knowledge. How do we do that? I have no idea.

We need more people like this guy