Work quantity

[Joe Flacco]

We are coming out of the slowest time of year in one of the slowest years in the last 30 years. November-January is always the slowest.

 

[chad hampton]

Back when we all had a business, you could call your clients and see what they had on the horizon.

 

[J Grant]

same, got in 3 bids, but I guess $325 with 1-2 day turn is TOO expensive. Did not receive the work.

That is a shame.

I am fortunate to mainly have direct clients where the bid is not in play, but they are extremely slow, like everybody else.. I fear the day the AMC powerhouse takes those clients' away. It may never happen, but I distrust the establishment that provides incentives to see it happen.

We can't prevent lean times, but if people got a full fee then the lean times would be easier to handle. The lenders should be paying the AMC out of a cost, not out of a split of the appraisal fee siphoned away from the appraiser.

 

[EQUITY APPRAISAL GR]

We are coming out of the slowest time of year in one of the slowest years in the last 30 years. November-January is always the slowest.

I realize this, however I have been an appraiser since 2000, and this is reminiscent of 08/09 to me!

 

[Terrel L. Shields]

Hope they learned their lesson and stop using those high interest rate credit cards....Seems a lot of folks have slipped between the cracks and are lacking INCOME!

That's a short-term solution that usually is just digging your hole deeper. You should never borrow on a CC. And too many people bought too many things on credit...Credit is leverage. And as Buffet said, quoting his late pal Munger, "Liquor, Ladies, and Leverage " were the only ways a smart person can go broke. I don't drink. The ladies don't like me. So all I have to worry about is not leveraging my money into debts...I am very thankful to be entirely debt free at this point and hope to remain that way. For a young couple with a child or two, a new car, and a large house payment, they are one layoff or pay cut away from poverty.

The Fed is focused upon a soft landing for the economy. That probably means inflation will be less concern to them than keeping employment up and the banks solvent. They are very much less concerned about the plight of people hurt by increasingly high prices so long as the goal is to soften the blow from a quick sudden deep crash even if that often is followed by a quick recovery. This is an election year. The Fed will not want to be seen as either promoting or hurting the current administration. That means while they may cut rates slightly, I seriously doubt the Wall St. estimate of 6 rate cuts will happen. The 4th quarter is looking so-so. But the huge layoffs we are seeing may be a harbinger of things to come that is going to be very tricky for the Fed to navigate.

About a year ago, I thought a hard landing was inevitable. But I changed my mind then that this may be a long protracted slow landing- soft or not- I think it will be a 3 year or more process and interest rates will not go back to 3%. Only a drastic crash will the Fed respond with fund rates below 3%... so a bank likes to make 2% over the Fed rate. I'm thinking 5% will be a basic minimum and time will force many people to refinance. As for prices, short a hard landing, I don't see them coming down and I do see 'affordability' remaining very problematic for young couples.

 

[J Grant]

I realize this, however I have been an appraiser since 2000, and this is reminiscent of 08/09 to me!

I was much busier in 2008-2009

Thet two periods IMO have little in common at least for appraisers, the commonality is that RE prices rose in markets-

A key difference was that the kind of loans made back then invited default - 225% LTV , teaser rates, adjustable rates, no doc loans etc

The loans now are safer wrt terms, and wrt the loans made on current terms that were low-interest rate loans, make borrowers want to hang on to the property if possible; where else are they going to get a loan now at 3.75%?

For an appraiser, 2008 -2009 offered review work and REO work, both absent in any volume now. There also is wivers/VA;ue acceptance in play now drawing a % of work. The reason we are slow has little to do IMO with CC debt, which is always present to a certain extent.

 

[Terrel L. Shields]

I was much busier in 2008-2009

REOs were a significant part of our business, and even more was the FDIC coming down on a couple of clients and forcing them to revalue all their loans that were possibly undercapitalized. One bank used an in-house evaluator to value commercial property less than $250K. And she owned stock in the bank. When the FDIC found that out, they demanded all these properties evaluated by her be repriced by a certified appraiser. And she was banned from doing evaluations. So I was valuing properties that were not refinancing.

The other bank was in even deeper doo-doo as they owned stock to the tune of $70 million in the failed ANB Financial - one of the first bank failures and much under-appreciated as to the total damage that it did to a number of other financial institutions. Suddenly from the best reserves in the state, they went to underwater, borrowed 20 million from another bank which only caused that bank to go under FDIC scrutiny. Then the REOs rolled in and sold for pennies on the dollar. I saw people repo'd who had never missed a payment yet their note was called in. They had borrowed 80% or more, and now the farm or home was worth less than 100% the loan. They had to cash in or cash out.

I still shudder to think I stood next to a woman who told me she cashed in her IRA to make the downpayment on their dream farm - a small chicken farm. The house was spic and span, not a single thing was not in working order. The bank was there and the banker felt as sick as I did. They were loading out the 100kva backup generator since those were being stolen right and left as poultry farms were being abandoned. They were even stripping the copper wire out of the houses.

Both those banks have long been under new ownership with new names.

 

[Joe Flacco]

I realize this, however I have been an appraiser since 2000, and this is reminiscent of 08/09 to me!

2009 was actually one of the highest mortgage volume years in the last 30 years. It was slower compared to only 2002-2003. Rates made new lows in 2009 allowing everyone to refinance again.

2002 rates made new long term lows, 2009 rates started moving down to new long term lows, then 2019 rates started moving down to new long term lows.

Rates are now in a long term uptrend. Without new long term lows in rates we won't be seeing volume anywhere close to the average of the last 30 years

 

[ucbruin]

2009 was one of my highest grossing years, if not my highest....

 

[Terrel L. Shields]

Biden is proposing building 500,000 new homes for "affordable" living. The question is how is "affordable" even possible when prices jumped 40% in 3 years? And to house who? The 15 million immigrants that barely speak English? That means more debt to subsidize this housing. And more bodies to compete mostly for low paying jobs will only depress wages.