Bifurcated appraisals...inspection reports

[gregb]

See minute 3:40 "...assignment conditions affecting credibility of appraisal..."

 

[DWiley]

I seriously doubt home inspectors will be the 'go to guys' for hybrid inspections. More likely to be realtors or uber drivers.

I think you are correct, but not for the reasons that some believe. This is certainly not new ground for us. We have been doing them for over a decade, and we use agents. We looked at using home inspectors, but the problem is that home inspectors are not licensed in all states. Same for insurance inspectors. Having a credential, of some kind, matters.

 

[George Hatch]

Appraisers *constantly* use data aggregated by 3rd party sources. Almost nobody pulls their own flood maps, many appraisers don't look properties up on the zoning jurisdiction's zoning maps - in many areas of the nation (including 100% of my region) appraisers are paying a 3rd party data provider for their portals into the public records databases. Appraisers are constantly using MLS listing info for their subject's prior sale and for all their comps and for their rental surveys and the like. The commercial appraisers subscribe to COMPS and Loopnet and other commercial databases for their info, much of that info aggregated by non-appraisers.


I recently heard of this talking point: "ALL appraisals are hybrids".


I've never once seen an appraiser refer to their MLS subscription or their CoStar COMPS service as having provided significant appraisal assistance. Moreover, my state doesn't even acknowledge measuring and taking pics as rising to the level of "assisting in an appraisal" for the purposes of accruing experience credits towards their license. It's not until the individual gets into the analyses, opinions and conclusions that those hours start to count.

 

[DWiley]

Appraisers *constantly* use data aggregated by 3rd party sources. Almost nobody pulls their own flood maps, many appraisers don't look properties up on the zoning jurisdiction's zoning maps - in many areas of the nation (including 100% of my region) appraisers are paying a 3rd party data provider for their portals into the public records databases. Appraisers are constantly using MLS listing info for their subject's prior sale and for all their comps and for their rental surveys and the like. The commercial appraisers subscribe to COMPS and Loopnet and other commercial databases for their info, much of that info aggregated by non-appraisers.


I recently heard of this talking point: "ALL appraisals are hybrids".

Exactly. If one did a cell-by-cell breakdown, I am quite sure that well north of 50% (like 70% to 80%, at least) of the data on a typical Fannie form report is third party data that was collected/assembled by a non-appraiser. We have been using third party data for a long time. Using third party data for the subject is just an extension of SR 1-2 and the SOWR Rule. The only difference is that we are accustomed to collecting the subject data ourselves. It is the "but we have always done it this way" argument.

Look where you live, GH. Site value is often the great majority of the total value; I see lots of reports with 80% or 90% site values out in Cali. Yet no one is claiming that the appraiser should survey the site himself/herself.

 

[gregb]

Who is going to "see more" of a site, a realtor inspector or a certified appraiser? Not much usage of "site utility" in my MLS comments.

 

[Renee Healion]

When a recognized product or service that our peers use (or have to use) is relied upon, that is one thing.
When we have to rely on a single human who is not us, that is different.
Is this a surprise to anyone? This is who we are and it's why we can be relied upon to operate independently.

 

[Eli]

Yeah, it’s like many people get in trouble for practicing a profession without a license. Or deeper. Real estate agents might be a good source. They don’t care. They are not on the hook.

Oh, let’s throw it out there on the market at 30% above market. Let’s see where it lands. They don’t care. They will cuss the appraiser to their client particularly if they are representing the seller. Representing buyer too sometimes. 3% is 3%. Just sell it. There are many that care. But they might be a good source for the OP either way. Appraisers might not bite.

I tried to verify some data on a sale where I had conflicting info from a very reliable source (not an agent), and the selling agent told me it was some type of hybrid/bifurcated thing. They said it was not an appraisal.

However, I am sure it was disclosed as an appraisal to the buyers/sellers.

 

[DWiley]

When a recognized product or service that our peers use (or have to use) is relied upon, that is one thing.
When we have to rely on a single human who is not us, that is different.
Is this a surprise to anyone? This is who we are and it's why we can be relied upon to operate independently.

By that standard there should be no issue with hybrids, as there are multiple companies who have been doing them over 10 years. Is 10+ years not long enough to be considered a “recognized” product?

 

[Renee Healion]

Your company can order them. You can cite a habit or history of doing them and, in so doing, assert acceptance of them. It is just not for me. I guess, Danny, I got trust issues.

 

[Eli]

I think you are correct, but not for the reasons that some believe. This is certainly not new ground for us. We have been doing them for over a decade, and we use agents. We looked at using home inspectors, but the problem is that home inspectors are not licensed in all states. Same for insurance inspectors. Having a credential, of some kind, matters.

Why call it an appraisal? Call it a BPO? Or a guesstimate? No need to call it an appraisal.