Advice from independent certified residential appraisals wanted

[SutureSelf]

Good morning! Long time follower, first time poster haha. If I am posting in the wrong place or could find the information I am looking for better please let me know!

I am a trainee working for an AMC and likely sitting for my residential certified exam within the next two months. I had always intended to be independent but getting a supervisor was easier through an AMC. I don’t see myself staying in this bureaucratic setting for too long. Based on the posts I’ve read, I don’t think I need to elaborate too much on what is unattractive about working for an AMC.

I am looking for someone (or anyone) who can share with me what their annual costs are (roughly) and how you begin to venture on your own. I’m sure health insurance, gas, computer programs etc add up but it’s hard to say when it’s built into your employment package at an AMC. Any tips on making connections and building relationships would be helpful too. And has anyone left an AMC and regretted it?

 

[Overimprovement]

Any tips on making connections and building relationships would be helpful too. And has anyone left an AMC and regretted it?

Lots of threads dealing with costs, most of it is overhead. Not hard to estimate--MLS access, county auditor access, E&O insurance, license, continuing ed, place to work and hardware, and big variable is mileage. Don't forget the opportunity cost of the benefits you WONT get--insurance, time off, 401K, etc.

If you are the least bit sociable, go to the clients you want to work with. Start with a the branch manager if needed, but a mortgage lender is better. Develop a rapport. Tell them who you are and your purpose right up front, they don't like being conned into thinking they have a customer. Bring food. Talk about the industry, tell what you are seeing, ask what they are seeing.

I have gained most of my clients that way, got 2 new ones just in March....and still am moving into a full time corporate job soon because the market continues to be slow now (Oct thru Mar all less than 50% typical workload), and the headwinds are TERRIBLE for this to be much of a career going forward. Most of what I am taking is stuff I would have turned down up until Q2 of 2022.

Good luck.

 

[Digger88]

if you have enough work to satisfy your bills id ride it out as long as you can. congrats to overimprovement for picking up new clients but that is rare right now for a lot of us. with each passing day appraisers are faced with new challenges to our profession that make this job less like a career and more like a gig until you find something else better.

 

[JTip]

Annual costs vary based on your income stream.

You obviously have your hard costs (MLS, E&O, software) and then your 'pay per use' fees (think AppraisalPort fees, pay per click assessment/deed access, etc) that can increase with business. One county I pay $500/year for unlimited access to tax cards, another county is a pay per click where I keep a hundo in the kitty till it runs out. Another county will only fax you a tax card for $5 EACH!

Most MLS are run by Realtor associations, which you must join and be a member. There are entry costs, and can be thousands, for office and MLS fees, but those are one time entry fees.

Me personally, for my PT gig, I run 5-10K a year for operations, obviously depending on volume that year.

***Remember too that lending fee work is NOT the only game in town. Don't forget about gov't appraiser opportunities, offering benefits and pensions.***

 

[Zoe]

You can write most of those costs off if you are self employed. That helps. You need to get something like turbo tax home and business or a good local accountant. But you can write most business expenses off which saves you on taxes.

Does your AMC withhold taxes on you or do you pay all your taxes now? Does your AMC pay all your business expenses now?

 

[PrincessLeia]

I am a trainee working for an AMC and likely sitting for my residential certified exam within the next two months. I had always intended to be independent but getting a supervisor was easier through an AMC. I don’t see myself staying in this bureaucratic setting for too long.

Dear Suture... When I was a trainee quite some time ago, I started apprenticing with my aunt and grandfather on Oahu. I was living in LA. When the travel became too expensive, I found a handful of different mentors in CA. I'm not going to lie... it was very difficult. I got almost no mentorship and was paying more in parking fees than I was earning. So, I totally understand what you're going through. Around the same time I got my license, I got married and moved out of CA. I re-apprenticed with a local appraiser in my new location and struck out on my own.

From that point of view, I will say: leaving CA was the best thing I ever did. The pay is horrifically low due to how many appraisers there are. At the time, a GOOD fee was $350. That meant you had to meet a massive volume just to keep up with the cost of living there. In my new location, standard fees were $500+ with a FAR LOWER cost of living. Granted, it was rural and the appraisals a LOT harder. But it took less appraisals to make a living wage. That meant I could learn more/teach myself what my mentorship missed, take more courses, write better appraisals, etc. I know appraisals in Hawaii are around $700+ but the cost of living is very high. Some rural places are also that high fee wise (my aunt who is now in Oregon gets $750-$800 in her rural location), but you'll be driving a lot of mileage in those rural locations and sometimes there is less volume so you have to think with that too.

My best advice is to find a location you WANT to live at where there aren't a lot of appraisers. Call a TON of AMCs and find out where they have a hard time finding appraisers. You want a population, but you also want less competition. The fees will be better and the pressure will be a lot less. Build up a savings in CA before you go and find someone who can mentor you in the new location. The easiest for me was to find someone who was in a nearby market who'd be willing to train me in their market so it's similar enough geographical wise, but I was not in immediate competition, OR to find someone who had 1 foot in the retirement door so they didn't mind training the competition.

MLS fees run typically $1500-$2000 per year. E&O is going to cost anywhere from $450-$750/year, I found OREP to be the BEST when starting out (LIA wouldn't give me the time of day as a newly licensed appraiser but OREP was very welcoming). There's also the cost of filing an LLC (if you choose that route), appraisal software runs between $350-$1,000 per year .... you also might want a website when first starting out which will cost a few hundred more, business cards about $50-$100, etc.... As far as insurance goes... that's a DOOZIE. I know OREP used to do group insurance. I get insurance through my husband so I don't pay it. But private costs can run anywhere from $800-$1500 per month depending on your age, preexisting conditions and the like. IMHO, it's best to see if you can find a discounted group insurance. Or just take the tax hit and pay cash.

Whatever you do, whatever it is, BEST OF LUCK!!!