AI Agents and Appraiser Oversupply

[NC Appraising]

Well, you have clearly imbibed the koolaid. So, you are saying there can only be one correct measurement for the GLA of a dwelling. Where is that recorded? You are saying there can only be one correct condition rating. Where is that kept? How many major components are in a house? What weight do 10 year old countertops get, compared to 20 year old countertops? If those are provided to appraisers, all can get the same rating. If they can't be provided to appraisers, then proponents of their "accuracy" either lack an understanding of the issue, or are deceitful when they claim an orange not called an apple is an inaccurate identification. But when appraisers start singing the praises of technology they don't have the first clue about, well, I will agree all are in trouble.

I'm diabetic...so no kool-aid.

I hate this as much as you. I want to buy some land in Montana to get away from it when the world burns. Can't afford to do that because all of the millionaires are playing out their yellowstone fantasy....


Cubi casa will probably come back with the same or similar measurement. Hire 5 appraisers on the same home, all will come back with a different GLA.

I use smartexchange and I compare my c's and q's with my peers. It's mind blowing on the differences.

I have been on this forum for years wanting appraisers to improve. It's never been to make us look bad so that we can be replaced. The exact opposite.

It's not all of our fault. The mortgage biz is a ponzi scheme to keep the economy afloat. Appraisals were just a check box for the investors. I learned that on my first week of being an appraiser. I was a naive terd thinking that lenders actually wanted what the home was worth. All they wanted was a value that met the contract price or their estimated value for the refi and a report that had all the check boxes checked and needed wording for the GSEs.

 

[J Grant]

and no one is safe....it you are in a safe industry...guess who is coming for you job? EV ER EEE ONE

Humans are smart enough to develop AI and then dumb enough to use it to wipe themselves out.

 

[Surf Cat]

Humans are smart enough to develop AI and then dumb enough to use it to wipe themselves out.

Let's put Musk in his own SpaceX rocket and let AI make all the necessary calculations to blast him off into space towards Mars. Buh Bye.....

 

[Non Sequitur]

GSE approval is not needed for any of the following... Just you and your Agent having a conversation and writing a report together.

Appraiser: Let’s move on to the appraisal for 123 Main Street. Pull all public, MLS, and data collection records into the workfile and give me a verbal summary of the home. Show me the floor plan of the subject then the 3D walkthrough as you describe what you see.

AI Agent: Retrieving data... The subject is a 1965 ranch-style home with 3 bedrooms, 2 bathrooms, and 1,800 square feet of GLA. Here is the floor plan. You’ll notice a traditional layout with bedrooms grouped on one side of the home, a central living area, and a combined kitchen-dining area on opposite side. Here you can see the home features metal siding, a 2-car attached garage, and a lot size of 0.25 acres. Permits show a roof replacement in 2021, which I’ve verified using a time-lapse sequence of aerial photos provided by Google.

Comparing MLS photos from the 2016 listing and to the current listing show that the kitchen was remodeled after the 2016 transaction. No permits were recorded for a kitchen remodel, however the quality and appearance of the work appear to be professional.

AI Agent: As we enter through the front door, the living room features hardwood floors....

Appraiser: Stop, I've seen enough. Proceed to the site overview. Show me aerial imagery and note any externalities.

AI Agent: Here is the aerial view. The subject backs onto a wooded area, providing privacy, and the front faces a busy residential street. The surrounding homes are similarly aged ranch-style properties, all well-maintained.

One externality to note: The busy road does not appear to affect usability but may be a consideration. The lender's reviewer would likely ask about it and GSE seller guides require some analysis,

Would you like to explore any additional details before we proceed to comp selection?

Appraiser: No, let’s move on. Pull similar sales within one mile, similar in size, style, and age, sold within the last six months. I would like to find one sale abutting the same busy road as the subject. You can go back to find something within the past year if necessary.

AI Agent: Searching… Out of 35 properties I’ve identified four potential comparables. Would you like me to summarize them or show their aerial views first?

Appraiser: Summarize them while showing me MLS photos of the interior.

AI Agent:

1. Comp 1: 3-bed, 2-bath, 1,850 sqft, sold for $450,000, located 0.5 miles away, renovated kitchen and updated bathrooms.
2. Comp 2: 3-bed, 2-bath, 1,950 sqft, sold for $420,000, located 0.1 miles away, original finishes, backs to a busy road.
3. Comp 3: 3-bed, 2-bath, 1,800 sqft, sold for $435,000, located 0.4 miles away, partially updated kitchen, original baths.
4. Comp 4: 3-bed, 2-bath, 1,900 sqft, sold for $460,000, located 0.8 miles away, fully renovated with a finished basement.

Comp 3 is the most similar in size and features but has an older kitchen. Comp 2 backs to a busy road. Comp 4 has a fully finished basement, which the subject lacks, likely requiring a significant adjustment.

Would you like me to help develop an adjustment for potential external obsolescence due to the busy road.?

Appraiser: Yes, typically we use around 3-5 percent for something like this. You can check in for something in my prior reports that we can use.

AI Agent: Searching report workfiles… Based on a prior appraisal you did in this neighborhood in 2025, you conclude a -2.5% adjustment for proximity to a busy road based on a paired sale. I will include a summary of that data the addendum....



Likely it will be the market will force appraisers to adapt. I don't think it will require any special appraisal software, just a computer with an AI Agent.

Yep. AI agents are happening now, impressive stuff.

 

[CGinMN]

Yep. AI agents are happening now, impressive stuff.

Some are completely missing that point. I'm not talking about LLMs. Agents will be native on desktop computers within a couple years.

The sky has been falling for 32 years, just very slowly. The reason you're making the same fee as back then is because technology is deflationary while everything else is inflationary. There have been efficiencies along the way, but nothing like what is in store. This time is different. We aren't waiting on the GSEs to cut the cord. These are market forces: efficient and cutthroat. The inflection point is just a few years away, after which we see a surge in efficiency. It's a hockey stick.

 

[J Grant]

I read a quote a while back - the new century - where efficiency replaced humanity.

 

[Non Sequitur]

Some are completely missing that point. I'm not talking about LLMs. Agents will be native on desktop computers within a couple years.

That's where I'm placing my bet. Agents can be trained and act in real time, but LLMs only know what they already know. My goal is to cram down everything I can and hopefully build an agent to complete and review reports.

 

[glenn walker]

Your safety net is two things.. the net profit based on existing fees is static at best or going down and your in a profession that virtually nobody is trying to get into. So for 90% of appraisers ages being 50 to 70 years old and if your on the high end of the age level you hope to ride out another 5 years. If your on the low range of say 50 you may survive because it's a business that's dying by attrition meaning each time someone retires or dies you bought more time. Anyone between 21 and 45 I would advise looking at changing careers unless you can live on a low and unsteady income.

 

[CGinMN]

With an agent, you will basically have a wizard trainee that can process and input information at instantaneous speeds. My agent will be different than yours, and yours will be different than everyone else's. Appraisers will be able to imbue it with their individual market knowledge and their approach to valuation. In Year 1 it might just be looking over your shoulder watching your moves on the computer and listening to your reasoning. The better you are at training it to focus on the correct things, the more you correct its mistakes, the more valuable it will be to you. You can train it to refine data and select/exclude sales based on how you do things. You can train it to develop adjustment ranges based on all the various techniques available. Just like the supervisor trainee model, in Year 2, efficiency will really kick in because you won't be teaching nearly as much and you'll just be supervising.

Now, it's possible that appraisers won't adopt it en masse, so those who do take advantage will have the efficiency without the fee deflation. But that won't last long because eventually the market for GSE appraisals will get efficient too, and that will be deflationary.

It is possible that as efficiency grows, and as reviewers implement agents in their processes, the GSEs and lenders will add more reporting requirements to raise the quality bar. It is possible your software provider will not only steal your appraisal data, but they will now much more information to steal.

I don't think any of this is certain, just the direction I could forsee things going. Maybe it will get regulated, or there will be privacy roadblocks. Maybe we'll be going back to typewriters and snail mailing reports. Maybe tghe quality won't every be as good as I'm making it out to be. Then again, still seeing a lot of $35-40/sf GLA adjustments when they should be closer to $75-$125/sf.

 

[sputnam]

*On-site observation by appraisers is going away. Floorplans and digital walkthroughs will be created by homeowners via smartphone. The majority of homes will not require any third-party observation AI might flag some properties for individual observation if it detects potential defects, but those will be completed by home inspectors, not appraisers.

*AI agents will be used in the remaining tasks including comp selection, data analysis, adjustment extraction, data input, and narrative writing. Each step can be done in a matter of minutes.

*Appraisers provide an oversight/review function. How many reports can the average reviewer complete in a day? Maybe 1 per hour?

*The process will get so efficient and cheap that GSE waivers might not even be necessary. Why waive any valuation when 24-hour turnaround and $150 cost becomes the norm?

*The profession will consolidate around a dozen or so national firms specializing in GSE work. Assume we need a capacity for 500,000 appraisals per month. That's ~17,000 per day, or ~2,100 per hour. With each assignment taking an hour, that's 2,100 appraisers needed. We might need closer to 5,000, assuming some inefficiencies. That works out to 100 appraisers per state for GSE work.

*I would say this could be less than 5 years away. All of this was probably unimaginable 5 years ago, so who knows what other advances will happen over the next 5 years.

Maybe.... All I can say is that I've heard.... over and over and over... that the end of the appraiser is upon us. Heard it for 40 years.. and we are still here.