AI Connect

[Gobears81]

Some blood sucking appraiser trainee sponsors who didn't teach the trainee anything anyway are having a hard time finding a college grad who will put up with their crap.

Although I would like to think that we have plenty to teach them, maybe that is our company's problem since none of the college grads are showing interest

 

[Meandering]

Just my opinion but,

Specialized appraisal areas should start with CGs not trainees. The question is; does having a specialty within the industry pay enough to justify the extra training? and, is there sufficient work available to support a steady, better than CG income. That is the issue, and it's not an issue we have any control over, so the risk of wasting more years in training is tremendous when weighted as opportunity costs on top of fee splits.

It's the opportunity costs that younger people are weighting in their decision to further train to become appraisers, and the obvious lack of steady work in some specialties along with a mandate to bid work, where the bidding process rewards the lowest bid instead of the best and brightest.

As residential appraisers well know, and CGs rarely discuss, is it might take 3-5 years or longer after college to obtain the license, but it takes an additional 5 to 10 years on top of that to build clients before they can get away from the bidding process and establish clients that will hire them regularly. So college + 15 years dedicated to training and experience before they have a "somewhat steady" reliable income. By then, most people with a financial or business degree could have moved a few rungs up the corporate ladder into perk heaven, not just getting settled into a somewhat steady income, that can get frustrated and upset by continuous regulation/law changes and requirements.

As much as we don't want to admit it, when lending is loose, and the buying is fast and furious, appraising seems like a great position to an outsider. But under the current strained lending and buying environment, those who might consider appraising must surely be weighting the overall economic conditions and seeing that the demand to buy is shrinking, or going to shrink hard in another recession along with large industries folding and leaving, why specialize in appraising heavy industry, when it will be extinct here, by the time you're looking for steady clients.

I was told when I entered the profession that it was mostly recession proof. We had work during the run up and in a recession we still had work for foreclosures, divorces and the like. That is no longer the case, REO work, even commercial REO work still wants to pay half or less of what purchase and refi work pays. Economically, the industry has become as unstable as the overall economy.

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[Eli]

Although I would like to think that we have plenty to teach them, maybe that is our company's problem since none of the college grads are showing interest

I was not throwing darts. I was shooting a scatter gun. LOL If I researched many posts on this forum and could find out the sponsor of some young appraisers, I could throw darts. LOL

 

[Eli]

Just my opinion but,

Specialized appraisal areas should start with CGs not trainees. The question is; does having a specialty within the industry pay enough to justify the extra training? and, is there sufficient work available to support a steady, better than CG income. That is the issue, and it's not an issue we have any control over, so the risk of wasting more years in training is tremendous when weighted as opportunity costs on top of fee splits.

It's the opportunity costs that younger people are weighting in their decision to further train to become appraisers, and the obvious lack of steady work in some specialties along with a mandate to bid work, where the bidding process rewards the lowest bid instead of the best and brightest.

As residential appraisers well know, and CGs rarely discuss, is it might take 3-5 years or longer after college to obtain the license, but it takes an additional 5 to 10 years on top of that to build clients before they can get away from the bidding process and establish clients that will hire them regularly. So college + 15 years dedicated to training and experience before they have a "somewhat steady" reliable income. By then, most people with a financial or business degree could have moved a few rungs up the corporate ladder into perk heaven, not just getting settled into a somewhat steady income, that can get frustrated and upset by continuous regulation/law changes and requirements.

As much as we don't want to admit it, when lending is loose, and the buying is fast and furious, appraising seems like a great position to an outsider. But under the current strained lending and buying environment, those who might consider appraising must surely be weighting the overall economic conditions and seeing that the demand to buy is shrinking, or going to shrink hard in another recession along with large industries folding and leaving, why specialize in appraising heavy industry, when it will be extinct here, by the time you're looking for steady clients.

I was told when I entered the profession that it was mostly recession proof. We had work during the run up and in a recession we still had work for foreclosures, divorces and the like. That is no longer the case, REO work, even commercial REO work still wants to pay half or less of what purchase and refi work pays. Economically, the industry has become as unstable as the overall economy.

.

Nobody wants to admit it, but the supply/demand issue lies with what the borrower is willing to pay for an appraisal and I don't believe it can be fixed until the appraiser is paid what the borrower pays. The lender has no demand, except for those few precious lenders that still exist who are really trying to take care of the borrower and the public in general. And they are still paying the appraiser what the borrower pays (bet they don't have a problem finding appraisers and keeping them).

 

[Stephen J. Vertin MAI]

"80,000 licensed real estate appraisers in the US today down from about 100,000 in 2000. If trends continue it means there will only be 60,000 real estate appraisers in the coming decade and a half."

Good. Supply directly impacts Demand and Fees. Current Over-supply given the "new" reliance on AVHums.....vs "human" Appraisals (declining) tied to increases in the de minimus.......causes declining fees and quality."

If I have said anything please let me make this part clearest. This is not a problem of to many appraisers. It is a problem of other industries coming in to our industry and doing the work faster and cheaper because they are not accountable to USPAP.

Mike perhaps I did not write this very well. It does not matter if we go down to 2 appraisers. Banks know they do not have to order an appraisal on single family homes worth less the $250,000 and $1,000,000 for commercial. These other ( de minimus) properties (which there are many) allow them to order other products. If I can order a BPO for $50 and the broker can do it that cheap since their is no requirement they follow USPAP who has the market advantage?

Ted Whitmer was on the panel (as most know he is an attorney). He brought up the point nowhere-nowhere at all in Texas law does it say a broker can provide appraisals but they do. The state appraisal boards do not challenge them due to the dollars backing the industry and its political influence. He was really informative (he has a class called "Why USPAP cant Work"). His theory is the document is filled with open ended langue. For example "credibility" which means "worthy of belief". Boards have been twisting the hell out of these open ended definition all over the country. Another issue twisted most is comparable selection. Do you realize there are only four or five sentences discussing what a comparable is (in most appraisal literature)? Given this open ended criteria any one can say properties are not comparable. What they do is simply drop the concept of markets tend toward equilibrium (because it fly's over most peoples heads) and hammer a point that has no criteria. How hard is it to beat someone under these circumstances?.

They bludgeon the hell out of our peers and we are all standing in the road like a deer in the head lights. These are not my words. Case after case after case are being reported and it is hurting our industry. The more people you throughout the less money there is to fight the hoards of industries coming into the appraisal arena. There are major, I repeat major flaws in our current regulatory environment and constant changing of the rules. How much public trust are you really building when you change your own rules every two year over the last +23-years?. The people evolved on this regulator side also see these flaws (more than any of us) because they had many speaking.

If a CPA firm can provide the value of all machinery and equipment and the residual is the value of the RE (according to our own theory) why pay for an appraisal. The state enforcement boards can try to go after the CPA firms but now you are talk big money and powerful lobbying groups. Again, if I have said anything please let me make this part clearest. This is not a problem of to many appraisers. It is a problem of other industries coming in to our industry and doing the work faster and cheaper because they are not accountable to USPAP.

 

[Meandering]

It also doesn't help that after 50 years or more, even the AI changed the definitions in the dictionary. It's okay to add new words to dictionaries as language is a living changing thing, but changing the definitions of basic premises, such as the different values, was purposely done to provide higher values in a declining market. We are nothing to be trusted. We are only parroting the special interests of those that make the rules we have to live by. When we can't maintain and control our own rules and definitions, we are just another structural problem of the wider economy that is forced down the throats of the many, who are not looking to be rich, or famous, but just want to be comfortable, feed their children, have a place to live, with clothes on their backs. Those people already know we are part of a hammer that looks to steal from them, and there is nothing we are doing about it.

 

[Eli]

Stephen, then look for major regulation to come down on avm's and BPO's in the next downturn. Of course FNMA and FHA and VA still require appraisals and they are major players. I don't look for them to discontinue or lighten their appraisal requirements anytime soon. And, I look for states to get tougher and tougher with the new AMC regs. I look for some AMC's to be regulated out of business. If some states tighten their definition of what is an appraisal, it would have major impacts on the industry within that state for sure. With these new AMC regs, states and the ASC are being given more authority.

 

[Meandering]

No new AVM regs. Are you kidding me?

Freddie provides the AVM. Appraisals will only last as long as they need us to fill their database. They will control the loans and the values, Real Estate will become their perfect vertical monopoly, controlled by government interests that can manipulate buyers and seller to suite the government's social agenda.

You think the government will give up that power, just before they complete their take over?

Government never gives up power, until there is blood on the streets, and we don't have the stomach for that.

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[Gobears81]

I've seen Brian Weaver post a time or two on this board. Wouldn't mind getting his two cents on this thread.

 

[Eli]

No new AVM regs. Are you kidding me?

Freddie provides the AVM. Appraisals will only last as long as they need us to fill their database. They will control the loans and the values, Real Estate will become their perfect vertical monopoly, controlled by government interests that can manipulate buyers and seller to suite the government's social agenda.

You think the government will give up that power, just before they complete their take over?

Government never gives up power, until there is blood on the streets, and we don't have the stomach for that.

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Some have mentioned recently how 8 or 9 years ago, an appraiser rarely turned down assignments from their best client if they were competent to complete the assignment and had the time to complete it. I know the trend of declining difficult assignments has increased in the last 7-9 years. Do you think it will increase even more in the next year or two?