For inspections, appraisers have the upper hand, because they are licensed and their certification of an an inspection via an appraisal SHOULD mean something. Unfortunately, appraisers have inadvertently made themselves useless by not following standards. Of course they did it with the help of the lending industry - which is 100% Accurate Group/Groundworks Inspections.
The only thing that can save appraisers is high standards and perfection in measurement. And that by the way means, not doing hybrids - because you can't trust the property inspection (at this time).
1. They should make ANSI/BOMA measurement a requirement in USPAP!!!! (That does not mean you have to give them the same weight as Assessor GLA or Building Area values in doing adjustments.) This would make measurements by appraisers RELIABLE. The public could trust them. They should make it a requirement to use appraiser measurements for MLS listings. (Many appraisers offer a second service of doing only floorplans).
2. Get a second source of income if you can't make a living doing doing time consuming perfect appraisals.
3. Find shortcuts to doing perfect measurements and inspections. (I don't think one of those IPad snazzy software floorplan apps will cut it, but I could be wrong - I just don't see the advantage they have in their current state.)
Otherwise, what will happen, you can pretty much predict: (1) Property inspection a la "per foot" accuracy, with sloppy placement of interior walls (if they are even drawn, most appraisers just stick some words where the rooms are), - CAN be done by high school graduates who don't know much else. And they will work for a lot less than appraisers.
(2) AVMs that operate off of GLAs from property inspections, and rough 0-10 quality/appeal/condition ratings by the property inspector, will be good enough for most lenders. --- At least, - and this is very important - that is what they lenders think.
But, I might add, I think property inspectors will likely be trained to report enough so that a home inspector can be called in, if needed. But still, doing measurements and floor plans "accurately" takes some smarts; and about anyone that smart is going to have a degree.
The real problem is that a lot of lenders just don't need that much accuracy in many cases, for example because of a low LTV, a very good credit rating or some other reason. However, the appraiser asked to do a 1004 more or less has to assume the worse case and has a lot of rules and regulations to follow. It's a mismatch. The appraisal industry is POORLY managed. Right?
In the end, licensed appraisers must give up some work to less qualified individuals. But that has always been the case, as it should be. Licensed appraisers should be used when there is significant risk of failure - for which there are many definitions. An individual investor who is investing 50% of his assets in a rental property has a much different perspective than a large lender making a loan for the same amount.
