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It's getting THIS bad

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xmtpedprl

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Dec 6, 2005
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General Public
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Florida
I have a friend who works in the post office. He probably isn't supposed to say (or maybe it doesn't really matter, I don't know), but yesterday he saw hundreds of post card mailers from a large Chicago appraisal firm advertising:

"Full URAR's for $225.00!"

I know this firm, and how they operate, and I can only imagine what the final work product must look like.

I just can't compete with that, I don't know how you make a living doing that. Compiling legal documents, and all that they entail (gas, software, MLS, E & O, etc...), that hang over your head for 5 years or more for $225.00? This is absurd lunacy in my opinion.

If something doesn't change soon then we will have become obsolete due to improper report generation because of this insane predisposition to seek and procure the lowest available appraiser.

Dave...
 

CANative

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Jun 18, 2003
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Retired Appraiser
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California
There's very little risk in producing a sh!tty appraisal report. As long as you don't tell HUGE lies the most you're going to get is some lender conditions.
 

Lobo Fan

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Nov 28, 2004
Professional Status
Certified Residential Appraiser
State
New Mexico
They think they are competing with eappraiseit etal that charge the lender about $250-$350. Or more accurately are tring to compete against $50 AVM's. If they have their business model defined to where they are making money at that price then you can choose to compete or wait for them to flame out.

Increased volume does not always mean increased profits. There are per unit costs that go up, but MLS fees, and such go down per unit as the cost is spread out over more reports.

Lower pricing is an inevitable outcome of a smaller volume of business. Getting lean and mean might not be a bad idea. At least you know where your competition is pricing their services.
 

Ray Miller

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Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Fess Up

Increased volume does not always mean increased profits. There are per unit costs that go up, but MLS fees, and such go down per unit as the cost is spread out over more reports.

I called this answer Fess UP!!!!

What to you want to bet they are not paying full tilt in cost of doing business.

Lets take MLS, I known of Appraisals Shops (not offices) here in Wisconsin who pay one MLS Fee for one appraiser, yet everyone in the office gets to use it. Where as an indiviual I get to pay full tilt. Same can be said for the Board of Realtor Fees. One membership but the others appraisers fee off it. Same for professional groups, one reg. member but the other appraiser have access to the data and publications. Same for all the other data bases. One reg. membership and the others use it at no charge.

This is not done just say in Madison or Milwaukee, but they may have appraisers working all over the state using there access points and memberships. Thus allowing a person in the area I cover to reduce there expenses by several thousands of dollars a year.

What does that do to the individual appraisal office. If I am thinking right it raises our cost of doing business.


Just how many out there allow this or work in an office that does this????
 

xmtpedprl

Thread Starter
Senior Member
Joined
Dec 6, 2005
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Florida
And it's not just a smaller volume of jobs; it's an over supply of appraisers. (Is there a box for me to check anywhere for that sort of thing?)

We, in Illinois, anyway, simply have too many appraisers. And I recall the days when the AI was so overbooked with students that they sat in the back of the room with make-shift seating arrangements. 80 to 90 students in classes that were supposed to be something along the lines of perhaps 60. No MAI's said "boo" about what they should have seen coming. No one ever tried to 'scare anyone straight' in letting them know that the years of between 2001 to 2006 (maybe 2007) were just an aberration, that there wasn't a chance in the world it was going to last.

And in hindsight I believe that they knew. But they sure wanted that money.

And yes, I am feeling down, and am ranting, grant some latitude here, I need to say something, anything....
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
In the Chicago-land market, if that appraiser's firm works primarily for AMCs, the $225 fee would be a bit of an upgrade over the typical AMC fees.

This is the market in which many residential appraisers work.
 

Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
And it's not just a smaller volume of jobs; it's an over supply of appraisers. (Is there a box for me to check anywhere for that sort of thing?)

We, in Illinois, anyway, simply have too many appraisers. And I recall the days when the AI was so overbooked with students that they sat in the back of the room with make-shift seating arrangements. 80 to 90 students in classes that were supposed to be something along the lines of perhaps 60. No MAI's said "boo" about what they should have seen coming. No one ever tried to 'scare anyone straight' in letting them know that the years of between 2001 to 2006 (maybe 2007) were just an aberration, that there wasn't a chance in the world it was going to last.

And in hindsight I believe that they knew. But they sure wanted that money.

And yes, I am feeling down, and am ranting, grant some latitude here, I need to say something, anything....


I heard it as late as 06 at all the TECT Schools around Wisconsin. Take the appraisal courses, we are short appraisers in the state. Now it has shifted to Home Inspectors and Nurses.

Talking about droping the bar. UW and the TECT Shcools as I understand it if you take a 3 year or maybe it a four year course in nursing you will receive your doctors degree starting in 08. They anounce it on TV News the other night. The shools need students in order to make it.
 

Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
In the Chicago-land market, if that appraiser's firm works primarily for AMCs, the $225 fee would be a bit of an upgrade over the typical AMC fees.

This is the market in which many residential appraisers work.

Out here in the sticks, I received broadcast orders for as little as a $150 and when I go back in to check the web site, someone with in an hour has accepted the order.

LSI calls once in a blue moon, I shoot them my bid, and never hear from them again. Why did the call in the first place?
 

Tony V

Elite Member
Joined
Mar 29, 2005
Professional Status
Certified Residential Appraiser
State
New York
We, in Illinois( and most every where else), anyway, simply have too many appraisers. And I recall the days when the AI was so overbooked with students that they sat in the back of the room with make-shift seating arrangements. 80 to 90 students in classes that were supposed to be something along the lines of perhaps 60. No MAI's said "boo" about what they should have seen coming. (Nah...They were looking at the big Z and jumped ship) No one ever tried to 'scare anyone straight' in letting them know that the years of between 2001 to 2006 (maybe 2007) were just an aberration, that there wasn't a chance in the world it was going to last. But all those traniees meant the chance to get more appraisals done for the firms that they owned.

And in hindsight I believe that they knew. But they sure wanted that money. Many places around here (and most likely across the nation) advertized beat the rule changes that take effect in 2008. quote]

"""If something doesn't change soon then we will have become obsolete due to improper report generation because of this insane predisposition to seek and procure the lowest available appraiser."""

Lowest price, fastest turn time and whom ever does it the way the LO needs it, regardless of the what the rules and guidelines state. Look around here, we constantantly see folks who are asking/seeking ways to do things that are obviiously attempts to circumvent the rules not only of USPAP but Data sources and other related software.
 

xmtpedprl

Thread Starter
Senior Member
Joined
Dec 6, 2005
Professional Status
General Public
State
Florida
Well, regardless of their motivations (and I think many appraisal educators knew better), this is reaching critical mass.

If this, our trade, goes the way of something like the VA rotational basis, man, that's it. No way to compete, no way to really get top billing for providing an outstanding service for a reasonable (as opposed to foolish) fee.

And if the government gets their hands on said fee appraiser panel, stating it's to "limit the ability to corrupt the process," well, you will never see so inefficient an engine for such a thing so long as you shall live

Seems to me that once these bail outs become settled, and the means to 'make sure it never happens again' is in place, it will be miserable for anyone in our trade doing work in the financial sector.

I realize that there are other avenues for appraisers (litigation, ad valorem, etc...), but let's face it, financial transactions are our bread an butter, and I don't want some governmental numchuck sitting between me and aggressive Capitalism.

Dave...
 
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