AMC Allocation of Commercial Jobs?

[glenn walker]

If you are responding to me, you misunderstood my posts. I said the same thing ( in two posts ) - that the AMC's do not as much leverage with the CG's.

I was giving an example of what they look for in fees- and why the fact that the AMCs have such tremendous leverage on the residential side empowers them to push fees down.

One of California largest AMC sends out commercial orders and their typical fees on small income 5 to 8 units $700 to $900 and on small commercial industrial the $1,200 to $1,800. The days of $2,000 to $4,000 ended for many and the CEO is a MAI.

The AMC also markets to Attorneys, CPA and of course the large banks. California has become extremely competitive for all licence levels.

 

[gregb]

Over 30% of our fee panel that did residential also did the 5 to 8 unit buildings but not real commercial but we only paid $150 more on 5 to 6 then a 4 unit.

What was your base fee for a 4 unit?

 

[J Grant]

And the reason they have that leverage in the market is because......

give me a d, give me an oh, give me an h....(doh)
because they have such a huge volume share.

If residential AMCs have collectively 70-80% of the volume, they have a lot more leverage over fees than commercial AMC's which might have 15% of the work (for example )

I can predict you are going to say that because there are fewer commercial appraisers. Indeed, that is a contributing factor; however, the fact is that if overnight the AMC controlled 80% of the commercial volume, they would have a big leverage over fees.

And to shut you off before you repeat the same arguments you always make about it is the residential appraiser's fault because they had too many trainees back in the day, when overnight, after the HVCC shifted the volume to AMC's, with the SAME number of residential appraisers, the day before and the day after, the fees got cut in half overnight. Literally.,

 

[glenn walker]

What was your base fee for a 4 unit?

$550.00 but up to $700.00 usually was approved. 5 & 6 Units not that much more many AG liked doing them for a extra $150.00 and since there not Fannie, Freddie, FHA hardly reviewed or stips like 2 to 4 units.

 

[glenn walker]

Remember many areas are too distant for staff and those are sent to independent fee CG to do often at much higher fees because there may only be a few in that market.

In Alaska the appraisers control the fee and if they said $2,000 for bum F cabin out in the woods you paid them $2,000.

 

[George Hatch]

give me a d, give me an oh, give me an h....(doh)
because they have such a huge volume share.

If residential AMCs have collectively 70-80% of the volume, they have a lot more leverage over fees than commercial AMC's which might have 15% of the work (for example )

I can predict you are going to say that because there are fewer commercial appraisers. Indeed, that is a contributing factor; however, the fact is that if overnight the AMC controlled 80% of the commercial volume, they would have a big leverage over fees.

And to shut you off before you repeat the same arguments you always make about it is the residential appraiser's fault because they had too many trainees back in the day, when overnight, after the HVCC shifted the volume to AMC's, with the SAME number of residential appraisers, the day before and the day after, the fees got cut in half overnight. Literally.,

The AMCs operating in the non-resd'l markets might only have ~5% of the work.

That's because the CGs have more options due to their market not being so oversupplied. Duh. And for most property types we STILL get shopped for fees - by the direct lenders - based on supply/demand. Ask any of CGs, including the MAIs. Without considering inflation, fees in 2025 are similar to or lower than they were in 2005 and that has zero to do with AMCs. We're not getting squeezed as hard as the residential appraisers but it isn't because our clients are somehow more benevolent than your clients; they just don't have quite as many alternatives. Waivers and hybrids being one example of the additional pressure your markets are facing.

 

[Terrel L. Shields]

I routinely get shopped by fee.

It is extremely rare for me to even be asked what my fee is. Only the occasional client asks. And it has been years since I was turned down for a fee that was too high. Often, they are not even bidding the work out.

 

[J Grant]

The AMCs operating in the non-resd'l markets might only have ~5% of the work.

That's because the CGs have more options due to their market not being so oversupplied. Duh. And for most property types we STILL get shopped for fees - by the direct lenders - based on supply/demand. Ask any of CGs, including the MAIs. Without considering inflation, fees in 2025 are similar to or lower than they were in 2005 and that has zero to do with AMCs. We're not getting squeezed as hard as the residential appraisers but it isn't because our clients are somehow more benevolent than your clients; they just don't have quite as many alternatives. Waivers and hybrids being one example of the additional pressure your markets are facing.

Yoyu consistently refuse to address the divergent set of motivations about fees for retail (non AMC clients ) vs wholesale (AMC's)

Retail clients, including residential mortgage lenders who do not use an AMC, have an interest in obtaining an appraisal at a reasonable cost. The wholesale client ( an AMC ) shops not just for cost but for profit, which vendor fee can they most profit from? This gives them an additional driver of motivation to pressure fees way beyond that of an end-use client who is concerned with reasonable cost.

I estimated 15% of the market, you stae 5% of the market. The upshot is the AMCs control the leverage of supply and demand on the res side because of their huge market share, not because of some heroic stance of the CG community or because back in the day some res licensed certs took on trainees. If you guys are bidding against each other and your fees are flat even without AMCs, you are experiencing some degree of oversupply.

The CGs do not have more options because the market is not so oversupplied - the CGs have more options because there are many more points of origin (diverse demand points ) for ordering commercial appraisals AND they can do residential work - they thus are not stuck with a highly concentrated number of big AMC /affliated lenders or big lender clients who control a large share of the volume on the residential side, Then add in the profit motivaiton dirving ee presssure from the AMCs.

You consistently ignore the real-world example that with the SAME supply of RES licensed appraisers, fees plunged almost overnight when the HVCC shifted a large amount of volume to the AMC's. Which blows the oversupply -the appraisers are to blame- out of the water.

Though by now the res appraisers working for AMCs are so traumatized and in need of a fee increase, that it has become entrenched -a sorry state of affairs.

 

[ZZGAMAZZ]

One of California largest AMC sends out commercial orders and their typical fees on small income 5 to 8 units $700 to $900 and on small commercial industrial the $1,200 to $1,800. The days of $2,000 to $4,000 ended for many and the CEO is a MAI.

The AMC also markets to Attorneys, CPA and of course the large banks. California has become extremely competitive for all licence levels.

Do legal firms in CA [divorce, estate, BK] often rely on AMC's for residential or commercial appraisals???

 

[gregb]

The days of $2,000 to $4,000 ended for many and the CEO is a MAI.

The Froboese brothers?