Are appraisers professionals? During these convoluted times of C-19 it is likely we will need to modify to some extent the way we do business, but must we modify our professionalism along with the way we practice real estate appraisal? I submit to you we do not. Let me explain why.
For some reason, some lenders have concluded that during C-19, when we are likely doing drive-bys and desktops, not full-blown interior inspections, we appraisers deserve lower fees for what we do. We all know how hard it is to make a dollar, so we shop for the highest quality and the lowest price. Is there any reason for a lender to shop differently?
OK, during these convoluted times, some lenders are going to offer less for an assignment than they did before. That’s just business. Since we are all busy right now, we are in the enjoyable position to be able to pick and choose the jobs we take, our clients, and the fees we will accept. Revel in that freedom now since we know the market will eventually turn and that broad choice we have now will narrow significantly.
But let’s get back to the idea of being professionals. Do we really need to put boots in the living room to come up with a credible value opinion? Since USPAP does not require an inspection, merely a disclosure if we did not, USPAP is not sure boots in the living room makes for an appraiser any more credible than not putting boots there. Now, should we inspect REOs? Probably, since their condition has a lot to do with their value “as is”. How about a really custom-built and custom-finished home? Probably, since if the subject does not have some of those custom touches the comps have, we have to know that.
What I am advocating here is that the appraiser, the professional, be allowed to make that call. When we do work for a GSE, that freedom is not present. We, the professionals, know when an interior inspection is warranted, as well as when it is not. Yet the GSEs and their investors have taken this freedom from us and, what’s worse, we let them.
What I’m saying here is we might need to put boots in the living room on occasion. But really, most of the time that may not really be necessary. It’s not really necessary we, the professional appraiser, take the photos. Frankly, in all but the rarest cases, we can contract out those services without affecting the credibility of the value opinion we form. Our time, our capital, our income are best spent in appraising, not schlepping around the countryside sneaking comp photos while we hope nobody call the cops on us.
We, as the appraisal professionals, should be free to make that call. And the GSEs should be free to live with the choices we professionals make.
For more information on this subject, please download and listen to The Appraiser Coach Podcast Episode: 528 During a Pandemic Are Comp Photos And Inspections Necessary