Show Your Work

I have never liked math.  I was never any good at it. My worst grades were in this subject, and I could just never figure out how it could possibly serve me in real life.  Of course, I grew up and can now see how math is quite useful, but I still don’t like it.

I am kind of a ‘cut to the chase’ type of guy.  Why put soup in the bowl when you can eat it out of the pan?  Consequently, my math homework would often look much like this:


Unfortunately, I would often get the answer right, but the problem wrong.  Why?  Because all of my math teachers required that I show my work.  This is what they wanted to see:


Just seemed like a lot of extra effort to me, but whatever.

Then, I became an appraiser.  I guess my days of showing my work are not yet over.  I often hear appraisers ask the question, “What am I required to put in my workfile.”  Maybe the best one-liner to keep in mind is, “Show Your Work.”

A workfile is simply the ability for you to reconstruct a storyline of what you did to arrive at your conclusions.  Often, you will need to do this weeks, months, or years after the fact.  Sometimes I cannot remember what I had for breakfast much less what I did days or weeks ago.  As you prepare your workfile, ask yourself questions such as:

  • Where did that adjustment come from?
  • Why did I choose those four comparables and not these other twenty?
  • Where did I get that condition rating?

There is a reason you came to each of these conclusions, just make sure your reasoning is in your workfile.  That is what it is there for.  Does it take extra effort?  Sure, but it might just save your hide someday.  If you want credit for the assignment, remember to show your work.



26 thoughts on “Show Your Work”

  1. Pingback: Show Your Work - Appraisal Buzz

  2. Show YOUR work. How about some real life examples of difficult appraisal assignments and how you arrived at your adjustments? Instead of just telling us to do it, it would be nice if ONE person in this entire country could come up with a class that taught HANDS ON appraising. Every class I have taken, the instructor stands up in the front of the class and demonstrates a Matched Pair analysis with like comparable sales that RARELY ever occur in the real world. I challenge you to come up with a REAL LIFE appraisal adjustment class, and HOW to make and explain those adjustments and you will sell out every class! DO IT!!!

    1. The Appraisal Institute has a great Residential Class on utilizing trend analysis to support your adjustments. Craig Stienly, SRA from South Dakota teaches it. It’s put on a different locations throughout the country. You can check the AI website for dates and locations. You learn to adjust using excel. It’s a 1 day class and you will get CE for it as it is approved with the State Boards.

    2. I agree with you 100%. I use to ask my boss as an appraiser trainee some pretty tough but important questions. He would just look at me with a blank face.

    3. Great comment Patricia!

      I just had this conversation with an appraiser friend last week. Most CE classes I take leave me with more questions than answers. Last year I took a class on appraising Green homes. After the class I realized I knew less about green homes than I knew before the class – so, I guess I did learn something! This is not the only appraisal class that has left me feeling like this.

    4. Good morning Patricia
      I think I have at times been in the same class. Paired Sales is a misnomer. Paired sales is where we select pairs that produce an adjustment that we think sound reasonable and or meets FNMA’s guidelines. This produces subjective adjustments. What we need in our appraisals are objective adjustments.

      The answer is “Regression Analysis” which produces objective and supportable adjustments. With regression analysis, we can show our work both mathematically and graphically. I have been using regression analysis in my residential appraisals for about five years. I cannot even imagine doing an appraisal without regression analysis.
      When I first started using regression analysis, there were no classes available, so I finally wrote my own and it has been approved in Oregon and Arizona. The Appraisal Institute also have several good classes in this subject. These classes use a PC with Excel software.

      Roy Wright, SRA

    5. Way to say it Patricia! I agree with all these comments! It’s always been a frustration to me. We aren’t working in metropolitan areas thus there are NEVER similar comps. There are sales. (sometimes)

    6. Patricia you are so right….When I look for CE classes they’re the same old lame and boring stuff. The sales comparison approach. The cost approach. After 13 years in the appraisal business I’ve yet to see a CE provider offer a class on a concrete way to make and defend adjustments. The majority of my work is done in extremely rural areas and the closest thing to matched pairs you’ll have here is 3 bedrooms and 2 baths. Those will be 10 miles apart.

    7. I completely agree. Trying to find any class, webinar or anything that really helps with real life adjustments would be wonderful!

  3. Check out the Appraisal Institute website (, and click on their education tab. You don’t have to be a member to use their education links and menus. They have numerous classes that apply to sales comparison, including new seminars and courses on using statistics as another way of deriving adjustments. They have multiple delivery options including online, online synchronous (i.e. live online) and in-class offerings. The classes and seminars are a little more money than some of the others, but the quality of the education is outstanding.

  4. Show your work. Yup, probably an all-round good idea. Then again, not another industry in the world I can think of is required to do so. I am fairly sure there are laws protecting that sort of disclosure. I wonder what a Broker work file looks like when they do a BPO. I just had (the lender had I mean) 2 BPOs done for a HELOC in recent times and cant help but be furious about it. Each broker, both from the same lender, told me they do over 30 of them a month. The last one asked me what the other broker came in at because “I don’t like to be less than the other guy”. This was after they explained to me that their method was “I always get it as high as I can get it, you know, I have to price it like I was going to list it, then I find three similar comps within a mile, unless none of them is priced right, then I pick comps by price”. Somewhere in the conversation I was pointing out all the upgrades and features of my property (LOL) to which they responded “there is only so much space on the form, so many times I cant write so much in”. The brokers are taking the place of what lenders have always wished appraisers would be, incompetent value pushers who will sign anything. I would state how far off each BPO was in terms of value, though for me that would be illegal without a work file. The part I really cant understand is exactly how a broker can write an appraisal for a fee on a deal they have nothing to do with or ever will have anything to do with (HELOC loan). Isn’t saying they might be involved in a sale in the event the loan might foreclose and the bank might repossess and maybe have need of a broker in an unknown point in the distant future a bit of a stretch? This is why I stopped contributing to my local RPAC every year along with my membership dues.

  5. I used to have a racquetball coach that used to yell at us, “All you have to do is do it!”. He was a professional player (back in the 80’s racquetball was big). He would do something – very quickly and then he would yell, “All you have to do is do it.”. He never really showed us WHAT to do OR HOW to do it.

    All you have to do is have a matched pair analysis for every comp and every adjustment – now go out and do it!

  6. Some of the comments on this board are troubling to say the least. If you don’t know how to support your adjustments now then how are you doing a quality job for your clients that are in compliance with USPAP? I see a lot of whining about courses not being available. That’s ludicrous!!! There are courses available on this topic – good quality courses – through the Appraisal Institute. I see people complaining that other industries aren’t required to show their work. Well, it depends on the industry in which they are practicing. The standards of our industry require you to support your conclusions and opinions. If you are writing a report in the appraisal report format then you are required to “summarize” your analysis and how you arrived at your opinions and conclusions. Do you have to have a paired-data-set analysis for every adjustment? No. But, you have to be able to support what you did. Simply adjusting $X per square foot for size differences and not summarizing how you derived it isn’t in compliance with USPAP.

    One comment related to brokers not having to explain how they arrived at their opinions and goes on to tell how they go with the high number. That is because brokers are acting as advocates for a position whereas we are required to be unbiased. Their job is to sell a property for as much as they can. They are also not held to the same standards that we are. So, enough with the complaining about others not being held to the same standard and be accountable for complying with yours as appraisers.

    A bit of advice to those doing the complaining. Stop taking courses from BS providers who tell “war stories” about their experience and call 7 hours of that crap “education”. Take quality courses from the Appraisal Institute and obtain the skill set to enable you to do what you do in a quality, USPAP-compliant manner. If you aren’t going to do that then get out of the industry, because those of us who are doing quality work don’t need you watering down our integrity.

    1. Michael Morris

      It’s always nice to hear from the smartest appraiser in the room. Ha Ha.

      Check yourself dude, you live in KENTUCKY for gawd’s sake.

      1. As another KENTUCKY appraiser, I submit that you sir are a prime example of the type of low quality appraiser that we professionals must contend with on a daily basis. To imply that ignorance has anything to do with geography shows your lack of education and professionalism…. “dude”. Lastly, for all of those out there like Mr. Michael Morris who I believe are saturating the industry with subpar (in this case I am sure, ignorant) opinions, let me say that when I review your appraisal work – and I will – may “gawd” have mercy on you………………. because I will not. Good day.

    2. Well mister KY Appraiser thank you so much for gracing us with your presence here at the ranch. Are you a teacher? Why, you should be with all that knowledge.

      1. Even though I assume that your comment is meant to be facetious, I agree wholeheartedly. We need more teachers with this type of fortitude – who take this profession SERIOUSLY. On the same token, we need more appraisers (and appraiser hopefuls) to take their courses. Namely with the industry leading Appraisal Institute. I wonder how many appraisers realize that their fees, which is always a hot topic, are a direct reflection of the piss poor work being submitted by their competition. Dodd-Frank or not, the sad fact is that many clients still want the quickest and the cheapest report they can get. While it is undoubtedly true in any profession that “you get what you pay for”, my question to the appraisal world is “are you the cheapest” and “why”?

  7. I think there is some resistance to “showing your work” based on the CU model out of Fannie Mae. What I have had come back is: why was your rating not the same as another appraisers. My response was: I do not know, please show me the data for the other appraisers analysis. I also am hearing that some regression models are being abused. I also wonder why it is the consultants pushing all the additional disclosure when they are not the ones on the grindstone. I have no issue with supporting the appraisal, I am just questioning the various agendas and data mining.

  8. Kevin Klosterman

    After developing and teaching some of these tools, I have observed some of the biggest problems the appraisal industry is faced with. I will propose something that someone besides me must follow up with. Create a study using all the “adjustment enhancement” software tools. If you used all the tools on a single property using the same data set you will see the disparity in each of the results. Then, have the same “transparent and statistically correct” tools used by different appraisers on the same property. These two tests will show you how obscure the idea of coming up with correct adjustments really can be. I fear there are a lot of appraisers using these new tools blindly as they believe the results are always correct when in fact, they are not. When the average appraiser does not have an understanding of the tools they are required to use, the industry is placed on thin ice. Another concern I see is, the CU requires all the adjustments have support and although some of the tools can derive credible results some of the time, none of the tools available product results on all the adjustments as the data needed to fuel that kind of granular results simply is not available especially in areas where data is sparse to begin with. No offense but, most appraisers are not able to comprehend when the statistically enhanced results are correct or not as they don’t have the training nor will they when there are few instructors who even understand this. USPAP has painted the appraisal field into a corner that makes it near impossible to comply with and the use of blind adjustments or just trusting the results from these new tools, is going to merely cause the appraisal industry to evolve into a valuation industry which will be a world with less boundaries.

  9. I will put in ranges (results from paired sales/stats) for the adjustments, backed up with land sales that support location, view, and site adjustments and why I went with one value for that adjustment. I keep a folder (not always up to date) of good sales data, paired sales, anything I get that supports an adjustment into ONE file. When asked to support the adjustments with the data, I explain, that under SR 2-2(a) of uspap which is in effect at the time of the appraisal (statement part of addendum), that the report was completed to the level of a summary appraisal report…and is identified by uspap as an appraisal report. If they want the work file, I ask then to basically pay for it. I just want to be compensated for the extra time. Now, if you had to prove every adjustment, which is different for every appraisal, then the appraisal would cost over $1000.00. Who will pay that? The only time that I am asked to “support” anything, is when the “value” is not hit. Then they send off a memo to support EVERY ADJUSTMENT. I got one recently! This was a 6000 sq.ft. house in a non conforming rural market area, next to train tracks Each comp, had 4-6 adjustments. REALLY. I quit! I got paid $310.00 for that appraisal, I spent two days on this report. I thought I did a good job!!! I guess the joke is on me. P.S, the request to support all the comps came back 2 months later!.

    1. I agree that the level of reporting that most clients want… and end up getting… through multiple revision requests… is well beyond the scope of a summary appraisal report. Most clients are trying to get narrative reports, but they refuse to pay for it. I recently completed a similar job to what your are describing, but got more than double the fee you did. By the time I did 4 “revisions”, I still didn’t get enough money. Perhaps you should consider raising your fees.

  10. I wholeheartedly agree with supporting your adjustments. However, we cannot lose site of what an appraisal is, an OPINION of the value of a property. That, it an of itself, lends itself to a good degree of subjectivity. I believe that both a quantitative and qualitative analysis is necessary. If regression analysis is the only the answer, then we are no longer needed. Can a regression analysis measure the effect of the hot pink kitchen? However, after 20 years of experience, I think I can have an opinion of the hot pink kitchen. I think both are valuable and are needed in the industry right now.

  11. Anthony Basile

    Until all the appraisers who will take an appraisal assignment for peanuts are out or recognized for their sub-par work, fees will remain in the basement.

  12. Nathan Bernhardt

    “There is no such thing as a good, bad, or average APPRAISER.” Each individual APPRAISAL is the measure.

    It makes me cringe–the arrogance, the myopia, the outright lack of general awareness, that appraisers display in their poorly reasoned arguments on boards like this.

  13. @KevinKlosterman. Great point. How many appraisers took Statistics? There’s these little confounded elements within Regression Analysis called Independent Variables, which can often negate or skew your data from Dependent Variables. Regression Analysis as a major focus or requirement in Residential Appraisal is flawed. For every dependent variable Id argue there are +2 or more independent variables that will skew or discount your data. Regression Analysis in RE Appraisal is not fundamentally sound. Im writing a paper on it. Others already exist!

    This is the layman’s synopsis. Hah, and the fees, ohh the fees. Do they expect the lackey appraiser to perform Regression Analysis on each assignment for a paltry fee? You’d better charge $700 or more if you’re going to work out a model that hasn’t been compromised by independent variables as you will have to spend four days or more (and on top of that, pray the third party data you are forced to use is accurate). Laughable. FNMA’s very own definition of market value printed on their forms is not what they want if you have guidelines and nonsensical Regression Analysis crammed down your throat.

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