What type of expenses do you mean? Yea I want to do that I talked to one that seems to have a great schedule and is making good money but I want to get more feedback
If anyone here is from socal let me know so we can have a chat
Expenses include:
- Errors & Ommissions Insurance - prices range depending on amount of coverage, type of work, and volume. Expect to spend $600 to $1000 a year.
- Personal Liabilty insurance - not required, but good to have as a CYA. I have never used mine and I have a low cost policy ($75 per year), but I have an appraiser friend who accidentally broke a rare vase will inspecting a home. The insurance picked up the $5000 replacement cost.
- MLS Subscription - different MLS' have different costs. Mine (Arizona Regional MLS) is $270 per year. However, when you first set it up, there can be high office setup costs (close to $1000).
- Marshall & Swift Residential Costs Handbook - The hardcopy book and CD cost $330 per year (includes quarterly updates). They also have a program that gives a more detailed estimate for $1000 per year. There are free options (like
www.building-cost.net) but M&S is the gold standard. Start out with a free option and then upgrade when you have the money.
- Additional Subscriptions - There are numerous data sources that may be worth subscribing to. The counties I work with have good online data, so I dont use any additional subscriptions. There are also data collection and form filling programs like DataMaster. I have considered DataMaster, but currently don't use. Data Master costs like $90 month.
- Internet - You absolutely need a stable high speed internet conection. Costs vary based on location and speed.
- Equipment - At a minimum, you need a quality computer, a measuring tape, and a clipboard with paper and pens. I am paperless, which means I save money on ink and paper (a considerable cost if you are a high volume office - we used to spend $300 bucks a month on just Laser printer toner) but had higher startup costs. I have a high-end home built computer with 4 28' monitors (which is extreme - I like a lot of screen space), use a Disto laser measurer, and just started using a phablet on my inspections. Minimally, it will cost $1000 to buy a decent computer, digital camera, a 100' tape, and paper/pen/supplies. Paper and ink costs will vary based on volume.
- Licensing/Professional Organizations - Every two years you will need to take continuing education classes and renew your license. Figure $500 (or more, depending on education costs) every two years. Professional designations, ie Appraisal Institute, NAIFA, ASA, ERC, can have annual dues. I wouldnt worry about these organizations until you are established and making money. I am a candidate for designation with the Appraisal Institute.
- Software costs - varies depending on program. I uses Total and have some additional plugins for specific clients. I also use MS office, I set up different models on Excel and use Word for correspondence.
Are there additional costs. Sure, like gas for all the running. I know appraisers that cover the entire state of Arizona and some that work in a very tight geographic area (Chandler, Gilbert, Mesa, and Queen Creek - Southeast area of Phoenix metro area) and their gas costs are very different. Generally, if you work a more rural area, you will have high gas costs, but you can also charge more for each appraisal due to lack of competition. But these are the major expenses that you will incur. Not including start up costs, like my computer and monitors or my Disto, which I have had for a while, my annual expenses are about $3500-$4000. I also keep a cash reserve to make sure I can cover any emergency (ie, monitor dies, need to replace my disto, etc..)
Okay...that being said, you won't have most of these costs as a trainee. If you work for an established office, you mentor will set you up with a computer and software, subscriptions and M&S, internet, and basic supplies. You will probably need to pay E&O (usually under a company policy, so it will be cheaper for you. My boss took $50 a month out of my check), your education and inital licensing costs, a good tape or laser measurer, and a digital camera. Some mentor may try to reduce their costs by charging you a monthly "office" fee. I have a friend who is a trainee in Florida and his mentor charges $250 a month to help cover his costs. This also includes his E&O, but I still think that sounds high!!
Find an appraiser you can shadow for a week. Go on inspections with him, watch him work in the office, writing appraisals, talking to clients. Like every job, there are frustrating moments and good moments. Even the quality assurance guy who tastes Ben and Jerry's ice cream everyday has bad days. Do I scream the 'F' word as loud as I can once or twice a week? YES. Clients can ask some stupid questions and want unrealistic things. But then you get a nice letter from a client that can make your day or week. I have several thank you letters from clients, thanking me for saving them money or for rushing a difficult appraisal (for a cost of course!!).
Do your due diligence, make sure it works for you. I have met some cool people, including sports stars and local celebs, and looked at beautiful homes. I like the fact that I spend half of my day outside and half indoors. I set my office up exactly the way I want so that it makes it easy to spend time and write up appraisals. Its not for everyone. You need to be detail oriented, you need to be flexible with the constant change in standards, equipment/tech, and clients needs/requirements.
If you have any other questions, please ask.
