My prediction on 3.6

[glenn walker]

If Fannie and Freddie want to level the playing field and make sure all the appraisers develop thier own cricial areas of the appraisal ( comp selection, the adjustments ) then they can add that to the certifications.

AI...it can pull comps now. Are they the right ones? Were better comps skipped over ? A human can determine that.

A Human doesn't mean appraiser almost anyone with elementary training can pick the outlier or comp that may not be comparable. That's where the appraisers $$ value gets quickly diminished.

 

[Zoe]

Ask @Terrel L. Shields if he thinks AI can do many of the appraisals on single family that he had performed over his career. He has worked complex assignments a long time. Arkansas can be as complex as Tennessee.

It is not like doing a home in a 250 lot subdivision or 500 lot subdivision.

 

[Surf Cat]

You mean like this?

View attachment 109823

That's from the 1004 though..... you know what you're signing to prior to even starting the report.

With the 3.6 the certifications are now shared dynamic certifications that adapt based on the property type, loan type, and inspection notes.....so, you don't know what you're signing to until you finish the report. At least, that's my understanding. Admittedly, I haven't done one yet. Shoot.... I haven't even taken a class on it yet as it sounds based on commentary here and other forums....like a hot mess.

 

[RCA]

This new system is definitely taylor made for the churn and burn crowd. The days of taking a few hours then going back to re-read your report because you wanted accuracy and gave a damn about what you were sending out are over.

The snake oil crowd tries to weasel their way out of this by saying stupid **** like - well, the appraiser still needs to understand and agree with the methodology the software programs use to determine adjustments, comp selection, etc, etc., and the appraiser is still responsible for everything in their report. But that's living in fantasy land. Not how things are in the real world. If you choose to pay for these services, you aren't going to go back and do double the work to see if you agree. You do it one way or the other.

I have watched the profession for a good 25 years. It has always had this problem: the MAIs (and other appraisers) have always harbored a radical aversion to advanced mathematics. In particular, they have always been very cautious about hiring trainees for MAI positions with foundational knowledge of advanced statistics and programming. If they found it necessary to hire such people, then it was only as data analysts; i.e., they would guide them away from gaining any appraisal experience that would allow them to obtain MAI certification. I could name names of the heads of well-known appraisal firms who are guilty of this, and rather openly so. It has always been across the board. If such a company did hire mathematicians or programmers as so-called "data analysts," they would push them out after a certain time. There has always been little tolerance and much fear of losing control to the math.

Now, such corporations and their organizations are starting to understand that they have no "material" to adapt and move forward into this new world. They are really screwed. And at least some of their leaders know it.

It's a shame. But even if you look at Henry Harrison, who recently passed away at the age of 96, one. of the very few real geniuses in appraisal, he never indulged in the math. It would have been interesting to have had a conversation with him a year or so ago. I am sure he could see the problem as well. But he was a couple of generations ahead of the current batch of leaders in the field.

By the way, even his books that are decades old are still refreshing reads.

 

[djd09]

US Residential Solar Installations Set To Stall For Years As Market Hits Wall​

Residential solar in the US is actively cratering after President Trump's One Big Beautiful Bill resulted in the sunsetting of a key tax credit for homeowners last year - which will result in a prolonged slump in installations, according to Bloomberg New Energy Finance (BNEF).

The market is not expected to recover to the record levels of 2023 anytime in the next decade...

adjustments come on man... how much are solar panels worth on homes for sale with them, especially in California

 

[DWiley]

.......so, you don't know what you're signing to until you finish the report. At least, that's my understanding. Admittedly, I haven't done one yet. Shoot.... I haven't even taken a class on it yet as it sounds based on commentary here and other forums....like a hot mess.

LOL - At least you admitted the lack of familiarity

 

[Alsie35]

HERE IS MY PREDICTION ON THE UAD 3.6 ABOMINATION:

What level of appraiser attrition due to "The 3.6 Abomination" would have catastrophic consequences for the real estate mortgage market?

The truth is - NO ONE (least of all the GSEs) really knows at this point. The GSE reps (as we have seen on other threads) are currently in denial about both this, ugly, possibility, AND are simultaneously minimizing like he** the % of likely appraiser attrition.

So - how to properly calculate appraiser attrition due to the "3.6 Abomination"? My thoughts are as follows:

1. Measure the total number of appraisers retiring/leaving the business starting in 2026 ("The Year of Implementation"**) THROUGH 1 YEAR AFTER "Full Implementation" - whenever that is;

2. Add to total active appraiser numbers the new accessions into the business over the same time period;

3. Divide #1 into #2 and *voila* - you have your TRUE "Abomination" attrition rate %.

What will that be? Well, here are my thoughts. Up to 50+% of the experienced appraisers (who make up the majority of appraisers nation-wide) are likely to leave the business over this time frame - if my AF poll is any guide (Its currently running at Retirement 59.8% - 3.6 Abomination 40.2%).

IF that happens then the overall attrition rate is likely to be somewhere between 30-45% in my view. What level would have catastrophic consequences (bring the market to a screeching halt ie 'Pandemic Turnaround Times') partly depends on the state of the market.

The WORST scenario for the GSEs:

40%+ of appraisers leave; A year later we have a RE BOOM. (I'll keep the popcorn handy).

** History Trivia: North Korean Dictator Kim-Il-Sung declared that 1994 was to be "The Year of Unification" (of the Koreas).

He then died - in 1994.

As for "Unification" - we're still waiting. Might be a lesson in there for the GSEs. Just sayin'

 

[George Hatch]

I don't see any reason to change the existing #16 assertion/limiting condition.

If I use a calculation that I did by hand via counting my fingers or toes, or if I use an abacus or a financial calculator, or if I use a spreadsheet or black box analytical tool - the results from any single or multiple iterations of those modes of analysis don't form the basis of my conclusions until I develop the opinion that they look reasonable to me. No different than if I'm reviewing someone else's report and agree or disagree with their conclusions, it might have started out being their work but my opinion of the conclusion is my own opinion.

 

[George Hatch]

Here's my prediction: If I spend (let's say) 20 minutes on measuring/inspecting and making my notes on a small dogbox SFR the new dataset might double that data collection process to 40 minutes. Maybe. I might also have to add a couple paragraphs in the various comment fields that I wasn't doing before. With this many datafields and depending on how my appraisalware vendor structures the data entry it might make more sense to use a tablet and input (direct injection) as I go instead of handwriting my notes and then transferring them into my report.

Comp selection and analysis will remain the same unless I'm using another separate app to assist with the data wrangling and analytics but that isn't a UAD issue. I can do it by hand or I can let an app do the drudge for me.

The appraisalware vendors might start out with kludgy interfaces but by the time they get to the 2.0 or 2.2 versions those should be reasonably stable and ergonomic. More data for the subject is still more data but I don't think it's going to trigger a hard stop for anyone who intends to stick to the business. TBH, I'd be surprised if the attrition rate attributable to the UAD exceeds more than 10% or 15% of the appraisers including many of those who were already on the cusp of retiring. Nor do I believe any of the experienced appraisers are too dumb or illiterate to figure out whatever appraisalware they end up choosing.

 

[J Grant]

I don't see any reason to change the existing #16 assertion/limiting condition.

If I use a calculation that I did by hand via counting my fingers or toes, or if I use an abacus or a financial calculator, or if I use a spreadsheet or black box analytical tool - the results from any single or multiple iterations of those modes of analysis don't form the basis of my conclusions until I develop the opinion that they look reasonable to me. No different than if I'm reviewing someone else's report and agree or disagree with their conclusions, it might have started out being their work but my opinion of the conclusion is my own opinion.

Imo, make an additional cert, rather than change the #16 cert. The additional cert is made to address AI use specifically.

The above - an appraiser looking over another person's work or an appraiser looking over the work from a computer or AI, and then forming an opinion that it looks "reasonable" is a far lower bar than the appraiser developing the work themselves.

The appraiser can develop the work using AI as an assistant, but that is different than letting AI do the work itself.

AI is different than using a spreadsheet or calculator - those are just tools or programs that do math. The calculator is not picking the comps, making the adjustments, and writing the narrative (all of which AI can do, even if it does it badly).