Realtors Meeting Appraisers at Every House to Give Comps

[Mile High Trout]

Getting comps is preferable. It provides you meaningful insight into the Realtors approach.

That way if you give them the dreaded Ceasar Thumbs Down signal, you can more appropriately describe the scenario.

Hopefully keeping everyone happy by being able to detail with astute insight, how lending rules and the application of the principals of substitution made similar comparable selection prohibitive or not agreeable.

I'm moving on Realtor, and you can bet your bottom dollar I'll feed all those appraisers comps. They're probably getting the orders because they're the lowest bidder. What would you have the Realtors do? Accept minimized service from the lowest bidder crews? These actions are a response to fewer familiar faces performing these appraisal services, and rightly so.

http://luminousvignettes.files.wordpress.com/2010/09/thumbsdown.jpg

When a Realtor closes a deal, they're counting on 2 to 5 large, every time, if not more. They don't care about appraisers being fee pressured. Nor will they be considerate about time saving approaches appraisers may take to manage the AMC pressures. Realtors care about quality service. If you state you have a better handle on market figures than they do, you'd better back that up. They probably have sold a dozen homes in that same locale, if not more. Yet more reasons, why appraisers should limit county coverage to 5 counts or less, depending on the size of counties.

Go be a Realtor, knowing what you know now about appraising. You'd feed those discounters comps too. You know you would.

 

[marc paolella]

"Please email or fax me anything you like....put it in writing, point out specific things I need to know........but don't insist that you meet me at the house. My schedule is tough enough without having to fit another person in. Email what you have....I promise I will look at it."

I really like this idea - thank you, this has been one of my biggest issues - scheduling. I really do have more than enough scheduling issues and fitting in times to meet realtors makes it even more difficult.

But I do understand the points about some appraisers not having a clue - I have seen a few reports that make me wonder. So, on the other habd, I do understand the realtors' plight, but I am going to start asking them to send me whatever they have and then I will address it in the report one way or another. Thanks, everyone. I love this forum. I have learned so much just by reading the various threads and I know I can always get great info from thoseof you who are true professionals and have been doing this for awhile.

By the way realtors are a good source of future appraisal business, estates, pre-marketing appraisals, divorce appraisals, tax appeals, etc. Just the kind of non-origination work we all want. I have gotten a ton of work from just being professional and nice to the agent at the inspection. So if you want to do the "don't bother me, just e-mail me" routine, go ahead, you're just throwing away lots of business.

 

[Pilgrum]

Count yourself as blessed. Around here I seldom see a realtor that does anything but put a sign in the yard.

 

[Mike Kennedy]

Due diligence includes soliciting info from owners and Realtors regarding private sales in the neighborhood, MLS "active" listings which are actually now UC but the listings haven't been updated/revised to UC, and brand new listings in the realtors office which haven't been inputted into the ML system.

When arranging an appointment with a realtor, I (like others above) always suggest he/she/they are welcome to provide any listing, uc, or closed sale data along with the CMA or BPO utilized to establish the current List Price for the Subject.

I also communicate that I am a Member of the local MLS, have appraised in a subject's neighborhood for 19 years, and that I DO also value their local "expert" knowledge. They are also informed on the phone, and at the end of the site observation, that I do not guarantee that all, or any, of the listings and/or sales they provide will make into the appraisal report but that they will be reviewed carefully and the info on truly competitive properties will be confirmed via Assessment and Building Department Records. Those which do not "make the cut" are typically listed in the appraisal report along with the reason(s) for their exclusion "closing the barn door and shutting out the light".

In my experience, which mirrors Marc's above, professionalism and due consideration of their opinions HAS contributed substantially to legal and review appraisal referrals, as well as, feasibility appraisals and "second opinion" dwelling measurement assignments when assessment records and prior appraisal(s) simply do not "jive".

Those in turn, snowball into an expanding client base of private, attorney, other realtor, and other mortgage lenders via personal referral. If WE expect to be regarded as professionals WE must treat clients, owners, and Realtors professionally.

IMO, what goes 'round comes 'round.

 

[Alpine]

I agree that it's better to address it upfront. I tried the opposite last year when appraising a sale, asking the agent which sales she had based her list price on, and whether she had any sales to support the list/contract price. She had none and offered none, admitting that most of the homes in the neighborhood had sold much lower. The subject was as cookie-cutter as it gets around here: a 1970s, 1000+ sf 3/1 ranch on a typical subdivision parcel in a neighborhood of the same.

After the completion of our appraisal, which included highly comparable sales and listings, including one nearly identical property on the same street, and which opined market value approximately 15% below list/contract price, the agent suddenly discovered a fistful of sales, submitted slyly through the AMC in a so-called "Appeal" which they demanded appraisers respond to.

Needless to say, I dropped the AMC as a client. Part of my rebuttal:

"Summary of Subject Characteristics:
Location: Suburban; Inside city limits
Site size: .18 acre / 8,000 sf
Year-built: 1974
GLA: 1,024 sf
Bed/Bath count: 3/1
Garage: 2-car
　
Realtor Closed Sales:
XXXX Street: Categorically superior with 1,744sf of GLA, 4-bed/2-bath.

XXXX Road: Categorically superior due to siting on 3.87 acres outside city limits, 1,506sf of GLA, 3-bed/1.1-bath, advertised as "mini-farm" with 24'x 40' shop, 30'x 60' barn, etc.

Realtor Pending Sales:
XXXX Avenue: Categorically superior with 1,601sf of GLA, 3-bed/2.1-bath, 3-car garage, 2-story home built in 2002.

XXXX Lane: Categorically superior rural acreage property with 20.23 acres. Vintage 1,276sf farm house built in 1905 and with listing photos featuring vintage fir floors and "huge" farm-type metal shop. Demanding that the appraiser address this sale is professionally irresponsible..."

ad nauseum...

 

[Pittsburgh Pete]

Dropped a client because that demanded that you address a buyer/agent's concerns about the value? I would have been surprised to hear nothing after coming in 15% below contract price. It happens all the time and as in your instance, their concern/rebuttal is unfounded. You would have preferred that they ignore the borrower/borrower's agents concerns? Me thinks thou are a bit over-sensitive. Undoubtedly a pain in the a@@ but it comes with the territory.

 

[ptoad]

I guess coercion was not the right word - although I do sometimes feel like the comps chosen are trying to lead me to a higher value than is the area is supporting.

I think the word you are looking for is "influence", and yes, I do consider this an attempt to influence the appraiser; so do Appraiser Independence Requirements.

Dodd-Frank addresses this also. They say a real estate broker can ask the appraiser to "Consider additional appropriate property information, including the consideration of additional comparable properties to make or support an appraisal." The inclusion of the word "additional" in this statement implies to me that this is after the appraisal has been completed.

I have no issue if they do this after the report is completed, or if the appraiser requests them prior to completion, but when this is unsolicited I feel it violates AIR.

 

[Ca Ar Independent]

Realtors used to do this all the time. The old school guys brought comps regardless and felt like it was part of their job. Most of these were (of course) cherry picked to support their value. In the last 10 years, there have been maybe 2 times that a realtor DID have a comp that I had not considered and which was useful! I always take the comps, thank them and make no guarantees that I will use them. I stick the packet in the file. Had a bunch given to me yesterday along with a 7am text asking if I used a particular one. (I didn't use it) . I told him that "yes, I had that one, thank you.". Doesn't hurt to gather the data, and I too like the added bonus that they can't claim later on that you didn't have this or that sale.

 

[Pittsburgh Pete]

I think the word you are looking for is "influence", and yes, I do consider this an attempt to influence the appraiser; so do Appraiser Independence Requirements.

Dodd-Frank addresses this also. They say a real estate broker can ask the appraiser to "Consider additional appropriate property information, including the consideration of additional comparable properties to make or support an appraisal." The inclusion of the word "additional" in this statement implies to me that this is after the appraisal has been completed.

I have no issue if they do this after the report is completed, or if the appraiser requests them prior to completion, but when this is unsolicited I feel it violates AIR.

And this phrase is somewhat opened ended so that it could indicate prior to the appraisal being completed.

I'm not coerced so easily.

 

[vicky1202]

I think the word you are looking for is "influence", and yes, I do consider this an attempt to influence the appraiser; so do Appraiser Independence Requirements.

Dodd-Frank addresses this also. They say a real estate broker can ask the appraiser to "Consider additional appropriate property information, including the consideration of additional comparable properties to make or support an appraisal." The inclusion of the word "additional" in this statement implies to me that this is after the appraisal has been completed.

I have no issue if they do this after the report is completed, or if the appraiser requests them prior to completion, but when this is unsolicited I feel it violates AIR.

You are right - the word I was looking for was influence. I definitely feel that some realtors are trying to influence; others are really nice and I think are trying to help - especially on some of the difficult ones. What I am wondering is if the Boards are now recommending this practice to all realtors - because while I have had it happen in the past - I have never had it happen as often as I recently have. Hopefully, it is just a sign of a realtor being a "good realtor" as one of you suggested and not an effort to influence unknowing, unwitting, naive appraisers.

Just a note to everyone - I am always polite and professional with realtors and I do accept their comparisons and review them. Some I use, some I don't. Generally, the ones I use are the ones I would use whether or not they gave them to me.