The front-half of your commercial appraisal reports (by self, associate(s), help from LightBox (N1) or other?)

[Michael P Jacobs MAI]

How do you write the front-half of your appraisal reports up to Highest & Beast Use, like client, Situs, history, current taxes, zoning, market information, etc.? I'm referring to all the basic report elements that lead up to our Highest and Best Use and Valuation analyses. Are your grinding away by yourself (like me), compiling and entering all the information from multiple information sources without assistance, or do you rely on others (employees, associates, and/or on-line platforms)?

 

[Michael P Jacobs MAI]

How do you write the front-half of your appraisal reports up to Highest & Beast Use, like client, Situs, history, current taxes, zoning, market information, etc.? I'm referring to all the basic report elements that lead up to our Highest and Best Use and Valuation analyses. Are your grinding away by yourself (like me), compiling and entering all the information from multiple information sources without assistance, or do you rely on others (employees, associates, and/or on-line platforms)?

I'm asking because I'd like to streamline but after 40 years I can't delegate, solve most problems before finishing HBU, and LightBox/N1 saves me no time - in fact, it takes longer and they aren't perfect. I'm looking for other ideas, if there are any.

 

[RCA]

Learn R script and automate what you do as best you can. That is to say, delegate as much work to your computer as possible. That way you always have absolute control of what is done and how it is done. As soon as you relinquish control to other people, you are asking for problems.

 

[JAW]

Hi Michael,

In the famous book, E-Myth, Michael Gerbe has a ton of great advice for small business owners. He recommends creating systems and delegating tasks to the least-cost resource. (Note, not a 'cheap' resource, they still must be capable). For CRE appraisal, that means using efficient tools and hiring one or more assistants, researchers, or candidate appraisers to help you do the lower-skilled work. Some want that, some just prefer to go it alone.

I've spoken to a lot of apprisers who are trying to decide if they want to add help to deal with all the work. I encourage them, even knowing that hiring and training are hard. But, the growth is exciting and there's a path to a time when you're not working every waking minute of your life!

Full disclosure (as my profile indicates), I founded Realquantum to help commercial appraisers eliminate manual work and boost revenue.

Best of luck and happy holidays!

-J

 

[RCA]

Hi Michael,

In the famous book, E-Myth, Michael Gerbe has a ton of great advice for small business owners. He recommends creating systems and delegating tasks to the least-cost resource. (Note, not a 'cheap' resource, they still must be capable). For CRE appraisal, that means using efficient tools and hiring one or more assistants, researchers, or candidate appraisers to help you do the lower-skilled work. Some want that, some just prefer to go it alone.

I've spoken to a lot of apprisers who are trying to decide if they want to add help to deal with all the work. I encourage them, even knowing that hiring and training are hard. But, the growth is exciting and there's a path to a time when you're not working every waking minute of your life!

Full disclosure (as my profile indicates), I founded Realquantum to help commercial appraisers eliminate manual work and boost revenue.

Best of luck and happy holidays!

-J

Seems like there has been a trillion such start-ups.

There is not much money in the pot. I'm sure almost no one gets rich off this sort of thing. Too many moving parts and existing technology is so antiquated that someone like me could come along any old time, and will - eventually, blow it to smithereens. And some company who has become dependent on your software will quickly find they have to throw it overboard.

There are places for very focused types of software like Argus. As successful as they are, they always had profitability problems. Large companies would skimp on licenses. I'm sure these product's prices have driven many appraisers out of business.

The major problem is a lack of talent in the area.

I'm guessing it is just a question of time before talent in China attacks this problem ... if they can get hold of people with a good understanding of real estate, math, programming and a variety of other skills.

But, what we have now, what we have had, is mostly junk. Doesn't hurt try though if you have money and/or time and other resources to throw on it.

 

[JAW]

Seems like there has been a trillion such start-ups.

There is not much money in the pot. I'm sure almost no one gets rich off this sort of thing. Too many moving parts and existing technology is so antiquated that someone like me could come along any old time, and will - eventually, blow it to smithereens. And some company who has become dependent on your software will quickly find they have to throw it overboard.

There are places for very focused types of software like Argus. As successful as they are, they always had profitability problems. Large companies would skimp on licenses. I'm sure these product's prices have driven many appraisers out of business.

The major problem is a lack of talent in the area.

I'm guessing it is just a question of time before talent in China attacks this problem ... if they can get hold of people with a good understanding of real estate, math, programming and a variety of other skills.

But, what we have now, what we have had, is mostly junk. Doesn't hurt try though if you have money and/or time and other resources to throw on it.

Ouch. I'm confident in the product my company offers.

Separately, I'm suggesting reading E-Myth as a good source of ideas for tackling this problem Michael describes. Many appraisers successfully hire analysts to research data and construct the first part of an appraisal assignment with little assistance. Those employees are wonderful to have, regardless of the toolset the office selects. Again, best of luck to you Michael! The start of a new year is a great time to think about changes.

 

[RCA]

Ouch. I'm confident in the product my company offers.

Separately, I'm suggesting reading E-Myth as a good source of ideas for tackling this problem Michael describes. Many appraisers successfully hire analysts to research data and construct the first part of an appraisal assignment with little assistance. Those employees are wonderful to have, regardless of the toolset the office selects. Again, best of luck to you Michael! The start of a new year is a great time to think about changes.

In E-Myth Revisited there is the following:

"If your thinking is sloppy, your business will be sloppy.

If you are disorganized, your business will be disorganized.

If you are greedy, your employees will be greedy, giving you less and less of themselves and always asking for more.

If your information about what needs to be done in your business is limited, your business will reflect that limitation.

So if your business is to change - as it must continuously to thrive- you must change first. If you are unwilling to change, your business will never be capable of giving you what you want..

<Just keep reading> ..."

Do you know what this says?

It says you must be in control.

 

[Russ Kitzberger]

I coded words for the items commonly used in the report, then I use find/replace.

For instance:
CLIENTFIRSTLASTNAME would be find/replaced with Jim Smith

When I had staff and did production work, we used to have a formula using excel that did this into a word doc, but it was too cumbersome, so I limited the repetitive fields in the report.

I do everything on my projects now and focus on complex problems, so it doesn't bother me to author a report from scratch. However, if you are trying to compete in lending, in a urban or suburban market a one-person system is not efficient and you should consider how to scale up to $400k-500k production with 2 analysts as JAW suggests.

 

[Michael P Jacobs MAI]

Hi Michael,

In the famous book, E-Myth, Michael Gerbe has a ton of great advice for small business owners. He recommends creating systems and delegating tasks to the least-cost resource. (Note, not a 'cheap' resource, they still must be capable). For CRE appraisal, that means using efficient tools and hiring one or more assistants, researchers, or candidate appraisers to help you do the lower-skilled work. Some want that, some just prefer to go it alone.

I've spoken to a lot of apprisers who are trying to decide if they want to add help to deal with all the work. I encourage them, even knowing that hiring and training are hard. But, the growth is exciting and there's a path to a time when you're not working every waking minute of your life!

Full disclosure (as my profile indicates), I founded Realquantum to help commercial appraisers eliminate manual work and boost revenue.

Best of luck and happy holidays!

-J

The book's concepts aren't new. My brother in law Used to say that there are finders, minders, and grinders. Good appraisers are grinders. Mediocre appraisers try to find a way out of the trenches, and the more intelligent manage or go to banks. I've never met a bad appraiser so wouldn't know what becomes of them.

 

[Russ Kitzberger]

I've never met a bad appraiser so wouldn't know what becomes of them.

They do residential lending. Look at the studies of appraisal submitted to GSE that lacked support for interior conditions and amenities or lacked adjustment for market conditions during the 2020 buying frenzy; checking the stable box to avoid support.

Anecdotal data from my own practice in investment, sales, and review shows about a 50/50 chance in urban and suburban markets of getting a decent quality appraisal for a lender. Race to the bottom for quality and price.