Ready to Start My Own Appraisal Business

[BigD LLC]

I am a recently certified residential appraiser working in the DFW area for a large AMC. While obtaining my 1,500 experience hours as a trainee, I was also heavily involved in the accounting, administrative and marketing aspects of my supervisory appraiser's appraisal business. In the 6 months I've been certified, I have managed to make enough connections through either charm, dumb luck or nepotism, to be rostered up full time on my own. My question is, what's stopping me? I don't want 55%, I'd like 100%. I take pride in my work and education and have verified I'm pushing out upper tier reports. Is there really a rule in Texas I can't start my own gig for 3 years? I keep hearing that, but have yet to see anything in writing.

 

[The Warrior Monk]

Is there really a rule in Texas I can't start my own gig for 3 years? I keep hearing that, but have yet to see anything in writing.

There's no "rule," but many clients may require that a person be certified for a particular period of time.

 

[Sid Holderly]

Like above, but also confirm the additional fees you may have that you do not pay now. The full cost of E&O, MLS membership and its monthly fees; office and backup equipment; some clients want you to have commercial insurance on your vehicle or a rider; your own general liability insurance; home space or office cost. If you own commercial office space the cost of its electric, water, sewer, heat/ac; insurance, and maintenance.

I have worked from home or by myself for years but miss the office banter. Do you have a source for a cooperating Certified General for joint work on more complex work? Do you have some local banks or attorneys (for estates) besides the AMC's?.

OR can you buy into the business and get a cut of others.

 

[BigD LLC]

There's no "rule," but many clients may require that a person be certified for a particular period of time.

Understood...I'm guessing that time period is about 3 years? Are there better options out there for a young & ambitious certified appraiser working in thriving DFW market, other than a nationwide AMC?

 

[BigD LLC]

Like above, but also confirm the additional fees you may have that you do not pay now. The full cost of E&O, MLS membership and its monthly fees; office and backup equipment; some clients want you to have commercial insurance on your vehicle or a rider; your own general liability insurance; home space or office cost. If you own commercial office space the cost of its electric, water, sewer, heat/ac; insurance, and maintenance.

I have worked from home or by myself for years but miss the office banter. Do you have a source for a cooperating Certified General for joint work on more complex work? Do you have some local banks or attorneys (for estates) besides the AMC's?.

OR can you buy into the business and get a cut of others.

I do not have a Certified General at my disposal unfortunately. My supervisory appraiser was an MAI, SRA for over 30 years, but he retired once I was certified. I'd like to start looking at my certified general license but not really sure how to go about obtaining the necessary commercial experience to do so. I do have local banks and lenders ready to work with me. I understand that there would be increased overhead but do you plan on working from home. I feel you on the banter though...this job can be very isolated sometimes and miss the appraisal and sports debates we'd have in the office.

 

[Sid Holderly]

If there is a local group of appraisers locally join it. I was with NAIFA that had a local group, since NAIFA went with ASA the group dissolved as a NAIFA entity but still meets once a month. This group offers support and area information that is helpful. Under current conditions, designations have no impact in my area on orders. I now belong to a couple of lower-cost associations to get regional & national info. Through the groups and their CE classes, I have 2 CG's I can work with. As a single-person office in my coverage area getting the credit hours in the time period required makes it near impossible to jump to CG. The number of jobs offered to me per year needing the CG are very low. If I wanted to drive a distance several days a week I could work with a CG on various jobs and get the hours in the required time frame. I am trying to be semi-retired now but have a hard time turning down very local work.

 

[BigD LLC]

If there is a local group of appraisers locally join it. I was with NAIFA that had a local group, since NAIFA went with ASA the group dissolved as a NAIFA entity but still meets once a month. This group offers support and area information that is helpful. Under current conditions, designations have no impact in my area on orders. I now belong to a couple of lower-cost associations to get regional & national info. Through the groups and their CE classes, I have 2 CG's I can work with. As a single-person office in my coverage area getting the credit hours in the time period required makes it near impossible to jump to CG. The number of jobs offered to me per year needing the CG are very low. If I wanted to drive a distance several days a week I could work with a CG on various jobs and get the hours in the required time frame. I am trying to be semi-retired now but have a hard time turning down very local work.

That's a good idea, I will try that. Thank you.

 

[Phil McDonald]

It is great that you have decided to start your own shop. I expect that is a good decision which will serve you well for many years. Of course, as you know, there is no such thing as 100% and after all the expenses you are going to be earning closer to the 55% you earn now than the 100% it appears you will earn. Get the commercial experience over time and do not be in a hurry to acquire those hours right away. You will still be learning a lot about appraisal, business, etc… when you start your own business. The best way to get the commercial hours when you are running your own residential business and can no longer afford to work for the value of the education instead of money is to get your own commercial assignments. Connect with an experienced CG who you will work well with and when you get a commercial assignment instead of referring it to the CG just work together on it.

 

[Alsie35]

There are plenty of AMCs, and as, your name gets out there, banks, that will be willing to send you work at a busy time like this. It may mean lower fees at the start, of course, which is part of the process - find clients willing to put you onto platforms like Mercury, cold-call AMCs and ask to speak with their vendor managers - be proactive. The squeaky wheel gets the grease.

THE key thing is developing an efficient SYSTEM. That takes time and the right pieces. My wife took over the running of all of my non-appraising work shortly after we met. It helped that she had a background running businesses. So she now does all of the secretarial, admin, scheduling and accounting/tax prep work. I've also trained her to do initial data pulls on orders that she then writes up for me on the front of each order form. I literally can spend 90% of my time on just appraising.

Another family member (now my trainee) takes turns with my wife driving me to and from appointments. Can you imagine how much more efficient you could be if you could spend that car time on your laptop typing? I can answer that for you - it can make the difference of an additional appraisal or an appraisal and a half a day in a busy bedroom community cookie-cutter area like DFW.

Just some ideas for you to keep in the back of your mind as you go forward. You are also probably way ahead of old timers like me in terms of using new technology software online platforms like Sparks that might also help you with efficiency. Good luck!

 

[Koryanakin]

I'm hoping to get certified later this year and am planning on starting a shop myself (in Fort Worth). If you want to get in touch later this year maybe we can share tips and ideas to help each other out.