Thoughts on Reviews

[The Warrior Monk]

Anybody can review, and anybody can do whatever they want with review.

What is the basis of this opinion?

In my experience, reviewers generally have to have a higher level of competence than the general appraiser population. Most of the reviewers I know I recommend assignments too; trust me, that is a tiny list.

Now if you're telling me that your opinion is based on reviews handed out by mortgage brokers or low-paying AMCs, there might be something to hang your hat on. Quality control is not likely to be the issue; more likely value control.

 

[Crunch Hardtack]

How deep do you dig?

For those of you who do reviews on a regular basis, one question I have is how deep do you dig on a review?

Got a call from am MB one day..."6 other appraisers just turned me down on this assignment, are you interested? Not really but I have some time to kill so I will at least go do the inspection for you." Anyway got to the property and it was obvious why everyone was turning down the assignment. The dwelling was built by a mass builder who is known in our area for crappy work. Get inside the house (it is in a rural area and not in a cookie cutter neighborhood of similar homes) and find out that this house has at least 90k-100k of upgrades and improvements a nice percentage of which are not just cosmetic.(This model of home typically goes for 200k-220k). Homeowner also has a large pole barn built by one of the better barn manufacturers and the barn also has a heated floor (radiant). ( That's a costly option for you city types.)

Appraisal notes significant upgrades and heated floor in pole barn.

You get the review assignment, drive by the property (no one home), see it is a "fill in blank" brand home. Then go back and do the review assuming it a typical quality home of this particular builder and do your review on that basis. Have you done your job as a reviewer?

 

[George Hatch]

How far? I'd say that for 90% appraisals that I review I am going a LOT deeper than did the original appraiser. I typically write 3 times as much "summary" than is found in the report, usually to fill in blanks or to correct erroneous statements made in the original report. I often write more on my reviews than I would if it were my own appraisal reports. Critique of a peer carries a higher burden of proof - demonstrating what isn't is often more time consuming than demonstrating what is.

For instance, my review on the above property would note the lack of homogeneity in the neighborhood and the infill development of the subject itself. That's one of the dominant attributes of the property and should figure heavily into comp selection. I would guess that maybe 10% of the appraisers whose reports I review would even touch on that aspect of the appraisal problem. Some as a result of ignorance and others as a means of deception.

That said, I'm only seeing the most funky of those that make it past my client's initial screening process. Sometimes they're funky because of the property itself (hence the 10%), but usually it's the appraisal report (90%). There are some appraisers in this region who do great work, but I don't often come into contact with them unless the appraisal problem they're appraising is exceptionally difficult or high end.

My client has 3 reviewers for San Diego County. Each covers a portion of the county. None of the 3 has less than 10 years in the business. I can't speak for the others but I know that none (zero) of the reviews I've submitted have ever been reversed by reconsideration or rebuttal. By the time I get finished with an "adverse review" it's rare that the original appraisers will even try to come back.

 

[hastalavista]

Ditto George, with the following exception:

I have had cases where the original report has provided additional support to address my concerns and satisfy a minimum credibility level so that its value is acceptable. This happens maybe 1 in 100.

I guess I stop when I hit the mantle; George digs all the way to the core (and maybe then to China)!

I would say that when there's fraud involved (and I've had several such cases), no amount of additional market data provided by the originator can explain it away.

 

[George Hatch]

What annoys me is that some of the appraisals I review are within reason on their value conclusions but their development and/or reporting are problematic. I think some appraisers would be shocked if they realized the extent to which they can avoid reviews in the first place by writing a better report and/or using better comps.

A certain percentage of my review assignments turn out to be repair jobs to support the original value conclusion rather than to reject or undermine the original value. The information was readily available to make the case but the appraiser didn't do it. In effect, I end up finishing the job they started, at substantial extra cost to my client.

 

[Fred]

Anybody can review, and anybody can do whatever they want with review.

What is the basis of this opinion?

The belief that reviewers are of another species.

 

[Fred]

As far as learning from reviews, I don't know if I would learn any more from that than anything else. I learn the most, the first time I do an assignment type: first historical property, first encroachment, first anything.

I would like to see folks review their own work without knowing it, work done long enough ago that they would not recognize it, and perhaps slipped into a stack of reviews.

 

[Walter Lea Thomas]

Hey guys, got a question or two. I've been at this a long time but with a break for a number of years. I'm curious about the review work. Can you make decent money with it and how much time does it take? I can see where it could be very beneficial to my own skills and make me pay attention to some of the areas I may not do as well at myself. Looking over somebody else's work has a tendency to make you a bit more aware. I like that but right now, I'm having enough trouble competing with skippies and making a living at this; not sure if they're worth the time right now. If I want to get into it, how difficult is it? I don't have enough appraisal clients to suit me, much less having to go out and beat my brains against the wall getting review clients. Or does it lead to other business?

 

[Robert Dunkle]

For those of you who do reviews on a regular basis, one question I have is how deep do you dig on a review?

Got a call from am MB one day..."6 other appraisers just turned me down on this assignment, are you interested? Not really but I have some time to kill so I will at least go do the inspection for you." Anyway got to the property and it was obvious why everyone was turning down the assignment. The dwelling was built by a mass builder who is known in our area for crappy work. Get inside the house (it is in a rural area and not in a cookie cutter neighborhood of similar homes) and find out that this house has at least 90k-100k of upgrades and improvements a nice percentage of which are not just cosmetic.(This model of home typically goes for 200k-220k). Homeowner also has a large pole barn built by one of the better barn manufacturers and the barn also has a heated floor (radiant). ( That's a costly option for you city types.)

Appraisal notes significant upgrades and heated floor in pole barn.

You get the review assignment, drive by the property (no one home), see it is a "fill in blank" brand home. Then go back and do the review assuming it a typical quality home of this particular builder and do your review on that basis. Have you done your job as a reviewer?

If you have done your job describing the subject, a good reviewer will not do the drive by and assume it is a "fill in the blank" brand home. The job of convincing lays in your lap!!! If I was reviewing it, I would want to know your definition of "significant" in referring to upgrades! After all, we all needed to know Bill C's definition of "is" and "sex".

 

[Murray Bloom]

Hey guys, got a question or two. I've been at this a long time but with a break for a number of years. I'm curious about the review work. Can you make decent money with it and how much time does it take? I can see where it could be very beneficial to my own skills and make me pay attention to some of the areas I may not do as well at myself. Looking over somebody else's work has a tendency to make you a bit more aware. I like that but right now, I'm having enough trouble competing with skippies and making a living at this; not sure if they're worth the time right now. If I want to get into it, how difficult is it? I don't have enough appraisal clients to suit me, much less having to go out and beat my brains against the wall getting review clients. Or does it lead to other business?

I don't know how anyone could make a living doing field reviews. They involve at least as much work as a 1004 and pay a fraction as much. :icon_frown: