My prediction on 3.6

[DWiley]

Valid point....it doesn't change STD 1, but the new reporting format is going to make it easy for appraisers to fly through the process and many newer appraisers will adopt the AI tools instead of doing the research and important inputs/pairings themselves.

How is that any different than what those same appraisers would do under UAD 2.6? I do agree that the emergence of AI assisted tools is a double edged sword. For those interested in good analysis, AI assisted tools can be really good. They can also be used in the manner you suggest - just throw in a prompt and use the results. But that has nothing to do with UAD (2.6 or 3.6), it has to do with the intentions (and training/skill) of the appraiser. What you describe has been seen for years in the 2.6 world. I cannot count the number of reports I have seen where an appraiser blindly used an adjustment from some tool/technology without knowing how the tool/technology works.

The new UAD was in development long before the explosion in AI capabilities. They will both impact daily work for an appraiser, but they should not be conflated as being the same thing.

 

[alebrewer]

Zero difference to the end user, until the end comes down on their head with financial ruins.

Remember, the appraisal only matters in case of default. It's the credit side of the equation that is actually responsible for the default...

 

[Tom D]

Remember, the appraisal only matters in case of default. It's the credit side of the equation that is actually responsible for the default...

True, but then it moves onto the appraiser's head shortly thereafter. If the appraisal is being done wrong by AI, oh i mean you using AI, it don't make any difference to those suing yous. Never heard of an underwriter being sued or the corrupt lending or AMC owner's going to jail. Anyway, just like the new glorious data centers, the neighbors are now learning how bad it actually is to be living near them, too late.

 

[nachocheesefries]

If the machine/computer does everything, including determining the adjustments and, "pulling comps " (selecting the comps), then it would be an AVM, and not an appraisal.

Call the final product whatever you want. 'AVM' only has a bad reputation by appraisers because its threatening to our profession. Users of AVM's like them or they wouldn't be allowed. They just want the number!

 

[chad hampton]

The "adjustment" programs of today are worse than the 1500 fireplace adjustments everyone used in 2002.

 

[nachocheesefries]

How is that any different than what those same appraisers would do under UAD 2.6? I do agree that the emergence of AI assisted tools is a double edged sword. For those interested in good analysis, AI assisted tools can be really good. They can also be used in the manner you suggest - just throw in a prompt and use the results. But that has nothing to do with UAD (2.6 or 3.6), it has to do with the intentions (and training/skill) of the appraiser. What you describe has been seen for years in the 2.6 world. I cannot count the number of reports I have seen where an appraiser blindly used an adjustment from some tool/technology without knowing how the tool/technology works.

The new UAD was in development long before the explosion in AI capabilities. They will both impact daily work for an appraiser, but they should not be conflated as being the same thing.

I think you are correct in that 2.6 and 3.6 are not really the issue...AI integration into our space was coming regardless of the form. The software provider with 80% appraiser market share ignored that fact and it is going to cost them and their users immensely. They are still refusing to adopt AI quickly.

Like most on this forum, at 23+ years in, I include myself in the camp of serious appraisers and try and do good/supportable work measuring market reaction along with everything else that goes into creating a solid report. The system does not care anymore...the metric is speed, price, then quality...in that order.

I am trying to point out the high horse of ignoring AI options filling out the 3.6 is going to put older appraisers out of the game when actually, it looks very easy to operate. Everyone watching videos on Alamode's lame solution for 3.6 is pissed off and frustrated because we have all blindly trusted Alamode's guidance on 3.6...but they don't know what the F they are doing. Just wanted to present my opinion on what is getting ready to go down, supported with facts from my own experience, not 'what ifs'.

Not fair of me earlier to call the AI solution an inferior product when it may not be...I see a world in the next 12 mos where AI is doing a good job selecting comparables in seconds and the human eye is just fine tuning the report. Not gonna be enough work for all of us, but ignoring the new way of doing things does not change that fact. This is how its gonna go down. People can choose to ignore it if they wish, but I respect my peers on this forum and don't want everyone blindsided with their head in sand yelling out how superior the old way is. No one gives a ****.

 

[J Grant]

Call the final product whatever you want. 'AVM' only has a bad reputation by appraisers because its threatening to our profession. Users of AVM's like them or they wouldn't be allowed. They just want the number!

You sound like a schill for certain software companies or AVM solutions. DOH, clearly users of AVMs like them, and they just want the number! Is the problem for the valuation end with respect to results that meet an MV standard? Of course, the number is the only interest on the profiteer side.

AVMs have their place, of course, and some clients run an AVM and do an appraisal. IMO, the best of the future offers several solutions that can interact and offer different perspectives- AI analytics and appraiser analysis. If these programs are abused and not monitored, they allow more fraud and skewed results on a mass scale.

 

[Zoe]

Which makes ZERO difference to the end user

Your wrong there. Do you remember some of the lawsuits that have come from borrowers?

They could come from anybody where AI screws up.

 

[J Grant]

How is that any different than what those same appraisers would do under UAD 2.6? I do agree that the emergence of AI assisted tools is a double edged sword. For those interested in good analysis, AI assisted tools can be really good. They can also be used in the manner you suggest - just throw in a prompt and use the results. But that has nothing to do with UAD (2.6 or 3.6), it has to do with the intentions (and training/skill) of the appraiser. What you describe has been seen for years in the 2.6 world. I cannot count the number of reports I have seen where an appraiser blindly used an adjustment from some tool/technology without knowing how the tool/technology works.

The new UAD was in development long before the explosion in AI capabilities. They will both impact daily work for an appraiser, but they should not be conflated as being the same thing.

How is it different - if individual appraisers in 2.6 blindly used poor adjustments, at least it was confined to those individuals and they could be parsed out, or educated. But AI is deployed on a mass scale - thus thousands of appraisers, if not monitored and reviewed, can download the same slop.

If AMC fees continue to be low, with a humiliating bid process to get an order, then why wouldn't an appraiser become cynical and fast burn and churn? They can clearly see how devalued they are. If the appraisers who take the time for their own analysis are not rewarded for it or fairly compensated for it, then they will leave the business or churn out AI slop themselves. Can clients who value good appraisals even survive? IDK the answer, but the problems are well known and not being addressed.

 

[Zoe]

Because JGrant the appraiser will still be held accountable if AI screws up. Any complaints will go back to the appraiser. Any lawsuits or complaints from anybody.