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Commentary on my day at the Realtors Blitz 2008

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Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Commentary on my day at the Realtors Blitz 2008

Interesting day yesterday. I went to the Realtor Blitz 2008 in Madison, WI as a vendor. There were about 90 vendors there with booths, I being one of them. About 300 real estate sales people and brokers attended. Nice breakfast as we set up around 6:30 a.m. excellent lunch, and the desert table around 2:30 was beyond belief (none for me).

My booth was selling my services using brochures and flyers: Auction Services, Real Estate Auction Services, Real Estate Appraisals and my related REO Preservations and Home Owner Services that can be found at my web site www.raymiller.ws . The day ended well for us and it was money well spent? I generated leads that total over $7M in real estate auction, set appointments to close contracts on $6M of the leads the first of next week. I also generated two personal property estate auctions, two business liquidation auctions. On the business liquidation auctions one is a high end cooking school and the other is a Fire Arms store with over 350 fire arms in stock. REO and related services for home owners I dispense 250 of our brochures. So again I must say a good investment with it appears to be a good return on my investment for the booth.

About one half of the booth space was made up of Lenders. Brick and mortar banks, one internet bank and mortgage brokers. The balance was made up of Real Estate Inspection business, builders Association, Government agency’s for real estate loans, a couple of three title compies and a few retail vendors selling retail products.

While the RE registrants were in there lectures, I took time to visit with a number of the inspections companies, the banks and mortgage brokers. The following is what I deduced:

The inspection companies, have raised there rates and the average home inspection appears to be around $500 now in towns near a city, in side the larger cities it appears to be $400 for you standard home around 1000 GLA to 1500 GLA. On larger homes the fee’s run from $400 to $1200. In rural areas the fee’s appear to be quite higher starting at around $700 and topping out at $1000 for a standard 1000 GLA to 1500 GLA, larger run up to $1700, if they wanted out buildings and barns inspected there were additional charges. It appeared that all who worked the rural area add mileage charges and travel time to the bill. Some said they were now charging .75 cent per mile and $125 an hour travel time. I ask them about any management companies that dole out orders. They said a few had tried, but none were successful in doing it. The main fact was the real estates agents and brokers were the ones that sold there services to the home owner. I ask about cut rate inspectors, those that cut fees. The answer were the good real estate agents and brokers tend to protect the good inspectors and the cut rate inspectors appear to fall by the wayside after a month or two or raise there rates in order to stay in business. I ask about time to inspect and write a report. All said they have a soft ware program that allows then to write the report on the spot using a tablet or lap top computer. The average time appeared to be four hours, again depending on the size of the property. By home fancy there booths were and the goodies they were passing out to the real estate agents and brokers, it again appeared they were doing well. Where as appraiser have we missed the boat??? The inspector’s ships appear to be staying afloat while we as appraisers appear to be sinking every day as to fees.


The banks, well they were open to taking my information on appraisals, many indicated that there fee panel was full and they were being over run by the new appraisers who came out of the tect schools in January and those coming out in May. The fee most paid on the local level in cities and those towns near by were $400 for a 1004. Rural areas the fees paid appeared to be $450 to $500. With one bank stating they were paying as high as $750 for their appraisers to do 1004 SF on rural property. All said they had no problem with fuel sur-charges under the present cost of fuel. The bank loan officers manning the booths did take my information on my appraisal business but said if I was not on there fee panel there would be little to no chance of getting on. Some there appraisers had been with them for 20 years. They add very few during the upturn two years ago, but went with the flow at that time. Some said they cut back their fee panel as business started to slow. Most of the loans they are doing are FHA, WEEDA, followed by Fannie and Freddie. Very little B & C paper. In a lot of cases if they know the borrower and have had a history with them they order an AVM, Credit report and are good to go with that. The bankers were most interested in my Auctions programs, On Line Auction site that is in the works and my REO Information. So I feel it was time well spent with them.

Now the mortgage brokers, this fish very seldom will not feed on the bottom. For the most part I gathered that most had switch to WEEDA and FHA for loans. It truly appears that FHA has become the new sub-prime market place. The MB’s flat out said they do not like appraisers that will not work with them on getting the needed value. One even said he didn’t understand if an appraiser was off $5000 to $10,000 that was needed to make the loan work, why they just could not change the value for the cause of making the loan. Several told me how they wheedle, beg, cajole the appraiser to get the value needed, even showing me how they did it. A few even ask me flat out if I would change the value if needed to make the loan fly. All said they would not pay above $250 for an in town appraisal report and $275 for a rural appraisal report. Many said they had appraisers who were doing appraisals for $125 in the cities and towns near the cities. Rural appraisals were getting done for $250 regardless of the size or number of acres. One even complained that he hired an FHA appraiser that charged him $750 for a rural appraisal on acreage with out buildings. That it took several phone calls to get him to adjust the appraisal so he could make the loan fly FHA. That he would never use that appraiser again. The rest in the booth agreed with him. (Things must have been slow at the office because they had six loan officers at the booth all day. They changed out at noon with a new bunch). They were always looking for the appraiser that would work with them and for less. I did gain information from them, but felt they talked out of both sides of there mouth. In fairness I did meet two booths that appeared to a better class of MB operation, but they said they had there established appraisers for years and unless one would retire, they were set. Sad state of affairs for the appraiser I fear. Why have we gone down this road of lower fees, faster turn times and hit the value if you want the work? What is going to happen to FHA in a year to three years? Any way the powers that be are they going to correct the FHA problems that are in progress now?

I did ask questions about the commercial side of the business, many felt that the commercial end of the real estate market was starting to slow, that there was a lot of vacant commercial space in the state with very little new business to fill it. Commercial development has slowed some what in the past year. Most felt it was a fall out due to the economy and the sub-prime mess.

All in all the day was well spent. Made good contacts for future business and got some deals done. I was asked to help teach some classes on Real Estate Auctions for the Board of Realtors and the Realtors Association for the state. Learn where the realtors, bankers and mortgage stood with appraisers. Learn that the home inspectors have held there ground on pricing there services and getting a return of investment and a return on investment. Lean that I was correct in changing my business model away from the RE Appraisal business as the major part of it.


How do we as appraisers put our business back on track and bring professional respect to it for the RE Residential Appraiser?
 
Last edited:

liznindy

Senior Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Indiana
Good Question

Ray,

Sounds like many of us should look at other options (clients other than MBs and/or other ways to use any other skills we may have) as you have....

I, for one, am getting tired of fielding the phone calls and emails from MBs who ask for value checks....Even after being told I don't do them and after explanation as to WHY I don't do them, they continue the "value dance"....


I am getting SICK of the whole mess!

Why is the lending business in such a mess???? IMHO, because of the lack of independence of the appraiser, appraiser pressure, and LAST BUT NOT LEAST the appraisers who have either a lack of ethics and or education in the appraisal process.

There is an article in today's paper about another mortgage fraud in Central Indiana....same old story.....
 

Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Very eye opening Ray, glad you had a productive day. Hey, stupid question, What is Weeda?


Misspelled the word, it is WhEDA. Wisconsin Housing and Economic Development authorty.

Sorry about that. 3 a.m. was early for me this morning.
 
Joined
Aug 16, 2007
Professional Status
Licensed Appraiser
State
Virginia
Sorry about that. 3 a.m. was early for me this morning.[/quote]

try melatonin maximum strength....:new_all_coholic:no problemo darlin..get some rest.
 

MNRural

Member
Joined
Oct 11, 2006
Professional Status
Certified General Appraiser
State
Minnesota
Those mortgage brokers are just bitter because they wont be around much longer. Their days are coming to an end.
 

Frederick

Senior Member
Joined
Nov 2, 2005
Professional Status
Certified General Appraiser
State
New Jersey
Ray, Nice reporting! Thanks for sharing your observations.
 

marytt

Freshman Member
Joined
Jan 19, 2008
Professional Status
Certified Residential Appraiser
State
Georgia
Commentary on my day at the Realtors Blitz 2008

Interesting day yesterday. I went to the Realtor Blitz 2008 in Madison, WI as a vendor. There were about 90 vendors there with booths, I being one of them. About 300 real estate sales people and brokers attended. Nice breakfast as we set up around 6:30 a.m. excellent lunch, and the desert table around 2:30 was beyond belief (none for me).

My booth was selling my services using brochures and flyers: Auction Services, Real Estate Auction Services, Real Estate Appraisals and my related REO Preservations and Home Owner Services that can be found at my web site www.raymiller.ws . The day ended well for us and it was money well spent? I generated leads that total over $7M in real estate auction, set appointments to close contracts on $6M of the leads the first of next week. I also generated two personal property estate auctions, two business liquidation auctions. On the business liquidation auctions one is a high end cooking school and the other is a Fire Arms store with over 350 fire arms in stock. REO and related services for home owners I dispense 250 of our brochures. So again I must say a good investment with it appears to be a good return on my investment for the booth.

About one half of the booth space was made up of Lenders. Brick and mortar banks, one internet bank and mortgage brokers. The balance was made up of Real Estate Inspection business, builders Association, Government agency’s for real estate loans, a couple of three title compies and a few retail vendors selling retail products.

While the RE registrants were in there lectures, I took time to visit with a number of the inspections companies, the banks and mortgage brokers. The following is what I deduced:

The inspection companies, have raised there rates and the average home inspection appears to be around $500 now in towns near a city, in side the larger cities it appears to be $400 for you standard home around 1000 GLA to 1500 GLA. On larger homes the fee’s run from $400 to $1200. In rural areas the fee’s appear to be quite higher starting at around $700 and topping out at $1000 for a standard 1000 GLA to 1500 GLA, larger run up to $1700, if they wanted out buildings and barns inspected there were additional charges. It appeared that all who worked the rural area add mileage charges and travel time to the bill. Some said they were now charging .75 cent per mile and $125 an hour travel time. I ask them about any management companies that dole out orders. They said a few had tried, but none were successful in doing it. The main fact was the real estates agents and brokers were the ones that sold there services to the home owner. I ask about cut rate inspectors, those that cut fees. The answer were the good real estate agents and brokers tend to protect the good inspectors and the cut rate inspectors appear to fall by the wayside after a month or two or raise there rates in order to stay in business. I ask about time to inspect and write a report. All said they have a soft ware program that allows then to write the report on the spot using a tablet or lap top computer. The average time appeared to be four hours, again depending on the size of the property. By home fancy there booths were and the goodies they were passing out to the real estate agents and brokers, it again appeared they were doing well. Where as appraiser have we missed the boat??? The inspector’s ships appear to be staying afloat while we as appraisers appear to be sinking every day as to fees.


The banks, well they were open to taking my information on appraisals, many indicated that there fee panel was full and they were being over run by the new appraisers who came out of the tect schools in January and those coming out in May. The fee most paid on the local level in cities and those towns near by were $400 for a 1004. Rural areas the fees paid appeared to be $450 to $500. With one bank stating they were paying as high as $750 for their appraisers to do 1004 SF on rural property. All said they had no problem with fuel sur-charges under the present cost of fuel. The bank loan officers manning the booths did take my information on my appraisal business but said if I was not on there fee panel there would be little to no chance of getting on. Some there appraisers had been with them for 20 years. They add very few during the upturn two years ago, but went with the flow at that time. Some said they cut back their fee panel as business started to slow. Most of the loans they are doing are FHA, WEEDA, followed by Fannie and Freddie. Very little B & C paper. In a lot of cases if they know the borrower and have had a history with them they order an AVM, Credit report and are good to go with that. The bankers were most interested in my Auctions programs, On Line Auction site that is in the works and my REO Information. So I feel it was time well spent with them.

Now the mortgage brokers, this fish very seldom will not feed on the bottom. For the most part I gathered that most had switch to WEEDA and FHA for loans. It truly appears that FHA has become the new sub-prime market place. The MB’s flat out said they do not like appraisers that will not work with them on getting the needed value. One even said he didn’t understand if an appraiser was off $5000 to $10,000 that was needed to make the loan work, why they just could not change the value for the cause of making the loan. Several told me how they wheedle, beg, cajole the appraiser to get the value needed, even showing me how they did it. A few even ask me flat out if I would change the value if needed to make the loan fly. All said they would not pay above $250 for an in town appraisal report and $275 for a rural appraisal report. Many said they had appraisers who were doing appraisals for $125 in the cities and towns near the cities. Rural appraisals were getting done for $250 regardless of the size or number of acres. One even complained that he hired an FHA appraiser that charged him $750 for a rural appraisal on acreage with out buildings. That it took several phone calls to get him to adjust the appraisal so he could make the loan fly FHA. That he would never use that appraiser again. The rest in the booth agreed with him. (Things must have been slow at the office because they had six loan officers at the booth all day. They changed out at noon with a new bunch). They were always looking for the appraiser that would work with them and for less. I did gain information from them, but felt they talked out of both sides of there mouth. In fairness I did meet two booths that appeared to a better class of MB operation, but they said they had there established appraisers for years and unless one would retire, they were set. Sad state of affairs for the appraiser I fear. Why have we gone down this road of lower fees, faster turn times and hit the value if you want the work? What is going to happen to FHA in a year to three years? Any way the powers that be are they going to correct the FHA problems that are in progress now?

I did ask questions about the commercial side of the business, many felt that the commercial end of the real estate market was starting to slow, that there was a lot of vacant commercial space in the state with very little new business to fill it. Commercial development has slowed some what in the past year. Most felt it was a fall out due to the economy and the sub-prime mess.

All in all the day was well spent. Made good contacts for future business and got some deals done. I was asked to help teach some classes on Real Estate Auctions for the Board of Realtors and the Realtors Association for the state. Learn where the realtors, bankers and mortgage stood with appraisers. Learn that the home inspectors have held there ground on pricing there services and getting a return of investment and a return on investment. Lean that I was correct in changing my business model away from the RE Appraisal business as the major part of it.


How do we as appraisers put our business back on track and bring professional respect to it for the RE Residential Appraiser?
Ray, thanks for the info. Yes, lenders have told me (even though it is supposed to be some sort of secret?) that FHA is indeed the new subprime market. I have also been told by Mortgage brokers that they cannot force our fees for FHA, they have to go with what we charge. We are seeing alot more FHA work, so be careful on these deals.

It is amazing to me that the brokers are coming right out and making those comments on value after the new Fannie and Freddie proclamation on lender pressure... they must not read the news. I agree with Paul, their days are numbered!

I have actually seen quite a change with brokers calling me saying things like: I am NOT trying to pressure you and if the value is what it is, then fine....but can you squeeze a few more thousand, etc. Of course I tell them, yes it is what it is!

I am starting to see many orders now that leave off the "Estimated Value" that was always on the orders before, so at least in our neck of the woods here in Georgia, it is getting better. I even had one order form that said, if there was any pressure from the loan officer to achieve a value, to call a certain number to report them. YES!

Have a great easter, thanks again for the information!
 
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