Canadian Appraisers

[Michigander]

Hello everyone;

I belong to an email forum from the Ontario chapter of the AIC (Appraisal Institute of Canada) and have been reading with great interest their situation of late. Seems that appraiser in Canada are in a much worse situation than we are with regards to AMC's and the like. They get paid next to nothing, and have to be designated members of the AIC to sign reports for many of the big banks. So a whole bunch of education and work that doesn't help them at all. Apparently many appraisers work for designated appraisers and just have a co-signature from the designated member, so they have to split their fees even further. It is becoming more and more difficult to become an appraiser there due to increased educational standards (university degree among them) and the pay is so low that there isn't much of an incentive for a well-educated person to get into the business.

Seems also as if the attorneys don't use appraisers very often for divorce work or estate work. They use the written opinion of Realtors instead, and only call in appraisers if the case is going to trial.

Home owners use Realtors to provide them with an opinion of value, not appraisers.

Most of the residential work out there appears to be mortgage driven, and they have really low fees to contend with.

I had been offered a job with an appraiser in Canada (my hubby is from Canada and wants to move back there, but after finding out what I would make, it was a non-starter), but further research into this appraisers assertations turned out that what she told me was completely unrealisitic. I contacted various attorneys to find out what it would take to get their business and was flatly told that they don't use appraisers.

Anyway, I think a large part of the problem comes from the appraisers not having any strong lobbying power in the government. The banks pull the strings, as do the attorneys and the Realtors (sound familar?). The AIC doesn't seem to be doing much to help the appraisers, and many appraisers find that there is no reason to belong to it (sound familiar?).

If we are going to avoid some of the same pitfalls that befalls our Canadian breathren, then I think we are going to need to get some really strong lobbying action going in our government. Instead of a multitude of small appraisal organizations, we need to throw our weight into one or two larger organizations (The Appraisal Institute comes to mind) and help make it a stronger organization that can help lobby on behalf of appraisers and stand up to the Realtor and Mortgage Bankers Associations. I don't know what the statistics are of how many appraisers are members (associate or designated) of the AI, but I suspect it is quite low. If more and more appraisers threw our lot in with the AI, and helped build it to a greater organization, then it in turn could help lobby for us, so that we don't become another Canada in regards to appraising. I'll probably get flamed now by all those anti-AI folks out here in the forum, but before you do, think about it! Think about one or two strong organizations instead of the splinter of organizations that are out there currently. Think what good this could do!

best, Rachel

 

[TC]

While I agree there is a need for ONE appraisal organization with the only purpose being lobbying, I don't see it happening. I would be willing to bet that very few on this forum belong to the AI, NAIFA, AGA, ASA, you name it. As far as joining the AI, been there. They pretty much treat residential appraisers like a step-child(if I can use that non-pc term) and I am not too happy about their alliance with AVMs.


I don't have the answer, maybe someone else does.


TC

 

[Michigander]

Hey tom cruise :yellowblack:

I would be willing to bet that very few on this forum belong to the AI, NAIFA, AGA, ASA, you name it. As far as joining the AI, been there. They pretty much treat residential appraisers like a step-child(if I can use that non-pc term) and I am not too happy about their alliance with AVMs.

I would imagine you are right about the number of folks on this forum belonging to any of the organizations, and I do agree that the AI can at times treat residential appraisers as lesser appraisers, however I think that could easily be remedied by more folks actually joining. The residential group is really very small. I got my designation this year, but am one of only four who did. That tells you how few residential members are going for this designation, as they see less and less value in it year by year (plus the fees are high once you are designated). One doesn't have to pursue a designation though, and there is strength in numbers, and to me at least, the AI seems the logical choice (despite the AVM fiasco).

Any other suggestions out there are welcome! I really hope we can save ourselves from going the route of what our Canadian counterparts are experiencing!

 

[TEL2002]

AI (or any of the other organizations) could easily quadruple their membership. Instead of charging several hundred dollars per year for a membership, charge $75.00 There is nothing wrong with a 2 or 3 tier membership. Associate member (non appraisers) say $50 bucks a year, Regualr members (non designated appraisers) say $75-100 a year, and Designated members, say $150-200 a year.

For several hundred dollars I want something more than the junk mail and email you receive about the latest insurance plan or vacation you can purchase. Most people will look at the membership and say, 'what am I really getting for my money?".

When was the last time your client asked you
1. Do you have a designation?????
2. Are you licensed or certified????
3. Do you belong to zzz orgazization?????
4. How much will you charge for this appraisal???
5. What is your turn time????

In MOST residential appraisal jobs today the key is what are you going to charge, how fast can you turn the job and are you licensed or certified.l...not what is your designation.

The first organization that offers reasonable fee structure, will strip the membership away from most of the other organizations.

Here's another thought.....
It is illegal to price fix. However, AMC's manage to do a pretty darn good job of it. What if an Organization worked something like an AMC and set minimum pricing standards for their members.

 

[Michigander]

 

[TC]

Rachel,

Years ago, when I was a candidate, I wrote the local AI newsletter. I used to inject some humor, unfortunately, I had to explain the jokes to the MAI's, so they dumped me.

TC

 

[Walter Kirk]

The answer to the problem in the U.S. is lobbying at the state level. If each state had a law saying that any person who provides an opinion of value for compensation must be a licensed appraiser the big banks, AMC's and sweat shops would have much less power.

 

[Kate]

Here's a dumb question, and may be off the topic a bit so I'm sorry.

But got to ask it and possible look like a fool, here goes.

How is the rate determined in Canada? I know the mortgage department is 100% different. I don't think they have 30 year fixed. Pretty sure on that but could be wrong. Have friends in Ottowa and I was trying to help them when the bought a house and everything was different. I couldn't tell them anything they could use. They have a mortgage that is fixed for ten years then they have to refi. Wierd.

If they don't have a 30 year fixed programs up there, and they don't put a lot of importance behind appraisers, I want to know where there rate comes from. What is it attached to. If rates go high there and all those people have adjustable rates, they may re-think the appraiser importance factor when people start going into forclosure.

 

[TEL2002]

Rachel,

Let's talk price fixing.....

In this area the RE Broker fee on a sale is approx 6%. Not 2, 3, 4, 5, 7.8. of 9.

Car dealers have a big book and it says charge em $xx per hour and X hours to replace the widgit. (no matter how long it takes.)

When you drive down the street all of the gas stations are within a couple pennies of each other.

Insurance companys say my Doc can only charge so much for a broken arm. Do you think he is going to charge less.

AMC's come out and say if you really want any business you must charge $zzz or our business will go to comeone who does charge that amount.

Interest rates for loans at the banks are darn close to each other...and if the rates are lower, they make the difference in the points and fees.

All of the above and a whole bunch of examples I have not mentioned are a form of price fixing. If it walks and quacks like a duck it is a darn duck.

How come there is all this fear that if a few appraisers get together it is some mean nasty threat to fair trade in this country and we are now all price fixing. H*** everybody else does it, why can't we? Why are we always trying to cut each others throats with out fees?????

When NAR walks into the State bldgs, legislators look and take notice because there are a lot of NAR members. What's a handfull of appraisers going to do.

I would love to see an appraisal organization with some muscle and some lobbying clout. But it will never happen when only a small percentage of the 80,000+ appraisers are a member. Why should anyone talk to an organization that only represents a small percentage of the appraisers? The only way they will get a large percentage of the appraisers to join is by lowering their dues. So they loose a few bucks per member by lowering the dues, but they will more than make that up in new membership dues.

This will require the leadership of all of the current organizations getting off of their dead butts, setting aside petty power struggles, and merging into one organization that can speak for commercial and residential appraisers with equal zeal and influence. Each and every state should have a powerful group that can march on the Capital at any time and get recognized.

PLEASE, GIVE ME A REASON TO JOIN. What you (organizations) offer right now does not cut the mustard...just the cheese.

 

[Michigander]

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