Lower Fees, What is wrong with some Appraisaers!

[Donna Quixote]

OK folks, this is directed to some of you out there that keep lowing your prices at what appears to be an alarming rate. Here in Milwaukee two years ago average appraisal fee was between $275 and $350. Now it seems like every client I have has different appraisers they can use because they charge less than me. (my average now is $225) Now I know we are all trying to stay alive out there, but how "alive" can you get for $150 per appraisal, even if they are FHA? Anyone who is under $200 this is directed to you. You are not only working more for less, but you are making the rest of us do the same thing so think it over before you decide to be the "cheapest". Someone will undercut you until you are finally getting $50 a pop. Is that what you are looking for? I have been asking clients what kind of quality they think they are getting and they don't seem to care.

Call me old fashioned, but I am proud of the product I put out, can stand behind it and have no problem sleeping at night because I know my license is safe. It is bad enough that there are value *****s out there that will put any price on an appraisal that the lender wants (you know who you are and I sincerely hope you will get yours in the end). But now there are the whole new breed of "I will do it the cheapest no matter what" If you really want to work for that little I am sure that there is some nice job somewhere that you can get $15.00 per hour for without all the pressure, why not give it a try?

As for the rest of us (and I hope the majority), lets try and band together and at least charge $200 per appraisal and we can all make a living. I heard from one of my lenders that they have appraisers in New York doing FHA work for $150 and feel that they don't have to charge extra for duplex properties because someone out there will take it. THIS IS NOT PRICELINE. WE SHOULD NOT BE REVERSE BIDDING ON OUR WORK UNTIL WE ALL GO BROKEm2:

 

[Mike Kennedy]

http://appraisersforum.com/showthread.php?t=142795

http://appraisersforum.com/showthread.php?t=142795

 

[JRS at OBX]

If you have lowered your fee to an average of $225, YOU are part of the problem.

 

[Pamela Crowley (Florida)]

For me, $350 is the bare bones minimum.

 

[Donna Quixote]

It depends on where you work. Wisconsin in inundated with appraisers.

 

[Mystery man3]

Hope your in a small market area

For me, $350 is the bare bones minimum.

Hope your in a small market.

In large urban areas like Los Angeles its not that easy when people are constantly undercutting you.

 

[Greenback]

Hope your in a small market.

I'm in a small market compared to many. There's some real intelligence (sarcasm) that take $175 for a full URAR 1004, here. I don't agree with the notion that its a supply and demand problem. There's a target, there is fixing, and then there's an execution.

(The fee can be used against a Real Estate Appraiser; nothing to do with supply and demand, in my eyes; when an execution is the objective, supply and demand may be exploited)

Sincerely,

 

[Mike Phillips]

THIS IS NOT PRICELINE. WE SHOULD NOT BE REVERSE BIDDING ON OUR WORK UNTIL WE ALL GO BROKEm2:

Why not? We had no business letting thousands upon thousands of people in this business who are not qualified to be here to begin with. What do you think will finally drive them out? Is there any doubt that after tousands upon thousands of appraisers get out that fees will not rapidly increase?

What don't you understand about the law of supply and demand? In the short-run a business entity is justified in operating at whatever fee/price the market dictates as long as the fee/price makes a contribution to fixed costs. The business owner's profit does not count - it is not a cost that must be paid.

For many appraisers, their opportunity cost in the short-run is zero, so what other variables costs are there? Gas? Other minimal expenses? Most of the costs of producing appraisals are fixed, not variable.

Many appraisers have lived since 1/07 on fixed costs that had already been paid; E&O, MLS, computers, software and so on. What many appraisers are dealing with right now are the fixed costs that are due to be paid AGAIN, for a another year in advance.

That is what the current stink about low fees is really about. Not only are appraisers dealing with low or no profit they are now considering they are going to have to make additional investment to stay in the business another year.

Let the fees hit bottom rock bottom - when they do the shake-out will be over in a matter of months.

 

[ddnma]

For me, $350 is the bare bones minimum.

Just curious Pam, how much work are you getting at your fee structure?

 

[Mike Phillips]

As for the rest of us (and I hope the majority), lets try and band together and at least charge $200 per appraisal and we can all make a living.

Yeah, that's a nice thought.

But Skippiest Maximus will be running his quota of trainees all the while, and making the argument that YOU should raise YOUR fees so he can keep his flock employed by undercutting you.