Here’s a question I get asked pretty often, both online and in person at my real estate appraisal workshops: ‘Should I pull my comps before or after the appraisal inspection?’ Well, the answer is… it depends. What it depends on, primarily, is whether or not you have the right setup and system in place.
By ‘setup’, I mean the setup in your office. How is your office managed? What kinds of resources do you have available? Most importantly in this case, do you have someone at your office who can pull up the information you need quickly and successfully?
‘System’ refers to the availability of information you need. That includes both information you need before the inspection, and information you need when you’re there.
When you’re looking for information before the inspection, you always need to ask yourself how reliable it is. Can you find your subject online that was recently listed or sold? Does the subject have good interior photos, taken in the past two or three years? Can you actually get reliable information from these photos, and not be forced to rely on the description? They say a picture is worth a thousand words; when it comes to subject evaluation, that’s an understatement.
Another way of gaining information before the inspection is to interview the contact for the property; often the owner. By asking a few simple questions before you go out there, you can often glean some useful tidbits.
Now let’s talk about what happens when you’re at the inspection. You can do all the research you please beforehand, but you never know what hurdles you might encounter when you’re at the property. This is when having the right setup and system in place becomes vitally important.
Let’s say something does go wrong. Let’s say the house was listed at 1000 sq ft, then you drove out there for the inspection and found that the owner had built a 500 sq ft addition in the last year. Suddenly, your comps are out of the window. In a scenario like that, do you have the ability to hop onto your phone, tablet or laptop and pull up new comps while you’re still in the neighborhood? Do have someone well-trained and skillful enough back at the office who you can call up to help you on the fly? Having a backup plan – having the right system and setup in place – is absolutely essential if you want to do your comps before the inspection.
Personally, I’m a big fan of pulling comps before an inspection. For someone in my situation, with the ground I need to cover (sometimes 150 miles each way), it’s a massive help. In general I find it to be a big time-saver, and saving time is one of the best ways to make your real estate appraisal business more efficient and more effective.
I do want to add one big, flashing note of warning here, however. If pulling comps before your inspections starts to affect the quality of your real estate appraisal work at all – even a little bit – then don’t do it. It’s not worth risking your integrity, your liability, or your license.
For more information on this subject, please download and listen to The Appraiser Coach Podcast Episode 039 – Pulling Comps Before or After the Appraisal Inspection.