Just what can a Certified Residential Appraiser Appraise?

[Terrel L. Shields]

It is a non-residential property which calls for an analysis and value finding, i.e., appraisal report that is something other than a residential appraisal, therefore you cannot accept the assignment.

some states do. some do not.

Arkansas explicitly allows a State Licensed or Certified Residential appraiser to appraise non-residential property in a FEDERALLY RELATED TRANSACTION "to appraising a 'transaction value' of no more than $250,000.
on NON-FEDERALLY RELATED TRANSACTIONS a "property value" of no more than $250,000.
A REGISTERED APPRAISER (trainee or non-trainee) may perform appraisal on any type of property except when the purpose of the appraisal is for use in federally related transaction, and must include in all appraial reports a statement that the appraisal may not be eligible for use in federally related transactions.
In other words, you can go to court, appraise an estate of any amount with a Reg. license, but it must state that the report is not for use in a FRT (also, if you are a trainee it means you cannot use the report for experience.)

 

[PropertyEconomics]

some states do. some do not.

Arkansas explicitly allows a State Licensed or Certified Residential appraiser to appraise non-residential property in a FEDERALLY RELATED TRANSACTION "to appraising a 'transaction value' of no more than $250,000.
on NON-FEDERALLY RELATED TRANSACTIONS a "property value" of no more than $250,000.
A REGISTERED APPRAISER (trainee or non-trainee) may perform appraisal on any type of property except when the purpose of the appraisal is for use in federally related transaction, and must include in all appraial reports a statement that the appraisal may not be eligible for use in federally related transactions.
In other words, you can go to court, appraise an estate of any amount with a Reg. license, but it must state that the report is not for use in a FRT (also, if you are a trainee it means you cannot use the report for experience.)

I have always thought if your not qualified for an FRT you are probably not qualifed for the court...

In my office there is a simple rule ... if its ANY kind of commercial ... residential appraisers dont touch it no matter how much or little it is.
We err on the side of caution and common sense.

 

[hcollin2]

Let's make it even more simpler, if we may. The issue is not what's allowable, the issue, rather, is if we are being misleading. The greater concern here, is the public trust.

The scenario presented is: "what can a certified residential appraiser appraise". The larger question is : "what assignment can a residential appraiser accept that wouldn't mislead the client, as to the appraiser's competency to appraise a non-residential property, and further lead to a violation of the "public Trust".

If, as stated by the questioner, the appraiser has little to no experience in the appraisal of non-residential properties, in this case a Church, then the appraiser must reveal to the client his level of inexperience, or be in violation of USPAP, as well as compromising the public trust.

That is the bottom line. The fact that one or more state appraisal boards may technically seem to allow a cert. residential appraisaer to appraise properties other than residential, does not excuse the appraiser from exclosing to the client, i.e public, that he does not posses the necessary practical experience to competently perform the assignment. Under these conditions, the appraiser is acting outside of USPAP if he doesn't decline this assignmnent.

HJ Collins, IFA

 

[Mike Garrett RAA]

In NM Mr Rex .. USPAP is the law. If you dont have competence in completing the assignment you must disclose to the client and then state how you will become competent .. or get someone to sign the report with you that is competent.
Its pretty clear I think.

Furthermore .. I dont think that NM Law will allow a Cert Residential to appraise a commercial property like a church .. but thats something that the board should answer.

Technicality....USPAP isn't the law, your state statutes are the law and they reference USPAP.

To the question at hand...IN MY STATE, residential appraisers can do some commercial properties. Check your state regulations.

 

[hcollin2]

OK. Let's break it down even further.

Let's look at it as: Technical Credentials v. Practical Experience(Adherence to Code of Ethics).

Every state licensing board around the counrty may state that, as a certified residential appraiser, you are qualified (technically) to perform valuations of all residential properties types, and a described segement of non-residential properties.

This technical allowance, notwithstanding, you still have to satisfy the requirements set forth in the Code of Ethics. The Code of Ethics of every appraisal board, USPAP, and affiliated professional orginizations, clearly requires the appraiser to identify his own lack of experience/competency before accepting an appraisal assignment.

Therefore, when asking yourself, "what can a certified residential appraiser appraise", it is essential to first ask yourself: Am I competent to perform this assignment within the guidelines of the prescribed Code of Professional Ethics.

I will not layout the every individual code of the ethic requirement here, since as a certified appraiser, you should be well versed.

Suffice it to say, that in these kinds of appraisal issues, always fall back to your Code of Ethics as the ultimate guide.

HJ Collins, IFA