The news hit like a freight train last Thursday – CoreLogic had acquired a la mode. The story sent shockwaves throughout the appraisal industry, and it’s no reach to say that the general response, at least on social media, has been negative.
Appraisers have been nervous about CoreLogic’s growing influence over our industry for some time now, and their acquisition of a la mode sent this sentiment into overdrive. The word “monopoly” has been thrown around on forums and blog posts, and I even saw one appraiser on Facebook comparing this to the “big bad wolf eating up the little sheep.”
I was driving when I first heard the news, and honestly, it felt like I’d been punched in the gut. Questions like “What does this mean for me?”, “What does this mean for appraisers?” and “What does it mean for the future of our profession?” flew through my mind. Later that day, after some time to process, I hopped on a live Facebook chat with my All-Star Team members, and delivered a bit of a different message (you can sign up here if you’d like to hear that in all its glory).
Sometimes trusting our gut reactions can work, but it can also be a good idea to take a step back, take a deep breath, and really think about what’s happened. That’s why I haven’t written this blog until now. I wanted to calm down, digest the news, and consider – and bear with me here – what positives we can take out of this story.
I’m a positive guy by nature, but I’m also a realist. I fully understand the negative side to all this, and the justified worries that appraisers will have. The point is that – in just a few days – all of that negative stuff has been written about and discussed to death. That’s why I want to offer something different in this blog, in which I’m aiming to provide a little ray of sunshine on this whole issue. I want to draw your attention to three possible – and please note the word “possible” – silver linings to CoreLogic’s acquisition of a la mode.
Firstly, there’s the question of integration. Have you ever tried to build a website just by using HTML, starting with just a blank page? It’s pretty hard! You know what’s a whole lot easier? Using WordPress. With WordPress you can start with a premade theme, and add in plugins, shopping carts, polls and surveys, email signup forms… the list goes on. The point is that that integration makes the process of creating a website a thousand times easier. If we do end up with a single company which integrates all the services we need to use as appraisers, then couldn’t that potentially make our jobs a whole lot easier too?
Secondly, there’s the question of data. The nature of real estate appraisal has changed over the years. Arguably our main sources of value used to be that we were the data keepers. Our clients would come to us for the data they needed. Needless to say, that’s not the case any more. Fannie Mae in particular has gobbled up all the appraisal data points and put them into their UAD system, which they do not in turn share with us. Seeing as we’re the ones giving Fannie Mae that data, that certainly doesn’t seem very fair.
One of the big questions that’s come from CoreLogic’s acquisition is “What happens to the data?” I’d put a positive twist on this. I’d ask whether, on some level, this could be a positive thing relating to the data. We’re certainly not happy with the Fannie Mae situation at the moment – what if this acquisition frees up more of the data for us? It’s certainly a possibility.
Finally, we need to look at the future of real estate appraisal as a whole. Many appraisers have questioned whether their jobs will even be around three, five or ten years from now. In turn, a lot of these same people have quit the profession entirely for what they see as a safer future. I’m definitely not ready to jump ship myself, but I think their concerns are valid.
In this context, I think this acquisition has to be seen as a good thing. Let’s face it – we may not like CoreLogic, but they’re an extremely successful company run by smart people. Those same smart people just decided to make a big acquisition, purchasing software which allows real estate appraisers to do their job. Would they have done that if they thought this industry was at risk of dying out? I don’t think so. Instead of jumping ship themselves and concentrating on a different area, they’re still fully committed to appraisal. I think that’s a pretty positive sign, myself.
I want to finish off by addressing the elephant in the room. Yes, I am sponsored by a la mode, and have been since I began recording my podcast. But folks, if you think I would sell out my integrity, and deliberately lie about my feelings when it comes to this for a sponsorship, you clearly haven’t been following me very long. I pride myself on being a straight shooter – always have done, always will do – and I genuinely believe there are at least three potential silver linings we can find in this acquisition.
However you look at it, this is both a fascinating and incredibly important issue, and I would love to get your thoughts on it. Please do comment below with your thoughts on the acquisition. In the meantime, try to fight the overwhelming negativity that’s out there and stay positive, people!
For more information on this subject, please download and listen to The Appraiser Coach Podcast Episode 321 – Is There A Silver Lining (or 3) with CoreLogic’s Purchase of a la mode?