Please join me in roasting crappy Appraisers!

Please join me in roasting crappy Appraisers!

Rental Property Investor · Tampa, FL · Member since 2019 · 128 posts · 166 votes

The role of the Appraiser is an odd one: Way too much art (opinions) and way too little science (data-analytics), with way, way, way too little accountability. While the world embraces tech tools to automate workflows and tasks, reduce errors, and thereby increasing precision, the Appraiser is basically doing the same thing they did 80+ years ago.  Show up with a tape measure and a camera, pretend like they are doing something scientific, pontificating unscientific opinions, charging ridiculous fees for said opinions, then going home with no accountability for the disasters that stems from those opinions. And the worse part: we have to pay for this rubbish, and live with the rubbish for 3-6 months we can pay for new rubbish --OR live with the rubbish and make a whole helluva lot less $$ then a scientific method would have yielded.

These people are not scientists.  They are not "professionals" in a true sense of the word.  Yes, in exchange for 75 hours you too can obtain a license to be an Appraiser and work on your own!  No one will check your work.  That's NOT a professional.  And by extension, it should no longer be a profession.  

This is a role in our investor ecosystem that is ripe for automation and transformation. I, for one, am sick and tired of these opinions (and folks, let's be honest -- that's all they are offering here.  75+ hours of qualification to offer you their opinion on what they think your property is worth.) Now I know there is the occasional rare professional equipped with both experience and a scientific method.  Well, I don't actually "know" -- I just suspect.  I've never actually had the privilege of meeting or interacting with such a rare species. (And to be fair, Robert Kiyosaki has said (once) 'a great Appraiser is invaluable.' I've just concluded that this is must be some mythical creature that would have great value if the creature actually existed.  But I digress...)

Alas, I don't know what one individual can do.  The ecosystem is set up to require us to get an appraisal the same ol' way we've been getting them since the 1930s.  So all I can do is joke about it.  So please join me in sharing your favorite Appraiser joke.  I'll start:

“What does an appraiser’s wife say if she can’t sleep? ‘Honey, tell me about your day at work.’”

Ok, one more...

“I finally figured out how to make a million dollars in the real estate business. You ask an Appraiser to appraise your two million property that you own free and clear.”

Keep it going... go on! I know you have a favorite.  Please share!

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IA · Member since 2019 · 33 posts · 29 votes
6y

 ..Weathermen/women?

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  • Rental Property Investor · Las Vegas, NV · Member since 2017 · 134 posts · 93 votes
    6y

    @Storm S.

    The purpose of a bank ordered appraisal in a purchase is NOT to determine the exact value of a property, it is to determine if the agreed upon purchase price is backed by the value of the property.

    This is the reason appraisals rarely come in above the purchase price.

    But i too share the frustration of bad appraisals. we just had two appraisals done for the same Property (Working with two banks to make sure we were gonna close) and its absolutely astonishing to compare them both, especially with things like rating of the market / neighborhood. one attests the neighborhood declining values, the other says values are rising - interestingly the one that said values are declining came back at PP, the other was 15k below.

    And another appraisal we just had attested our flip with a 385k sale price a value of 367k. he made some factual mistakes, stating "newer laminate flooring" when its all new waterproof bamboo, and "laminat counters" when we put brand new cabinets and quartz counters in. he ignored the mountainview and missed checkmarks on some existing appliances, and his comps were half the lotsize and not remodelled.

    we wanted to challenge it, but the buyer was so shoked about the apparent beginning decline in values, that he cancelled the deal after a month in escrow. 💁‍♂️💸

    On the other hand - i was on the receiving end of a bad appraisal before too, and ended getting a 235k Property for 200k - so i guess it all equalizes in some way lol 🤙🏼

  • Investor · Milwaukee, WI · Member since 2013 · 1k+ posts · 1k+ votes
    6y
    Originally posted by @Eury Marte:

    @Greg Moore reading stories like yours and others on this thread are extremely disconcerting. I’m new to the RE investment scene and have been reading and listing to everything I can find on the subject. It is ludicrous that someone can have so much unregulated control over the valuation of a property.

    Welcome to BP. You have much to learn my friend. How about I suggest you not believe everything you read on the internet!!! The regulation that mortgage appraisers are faced with and controlled by is the very thing that makes mortgage appraisals horrible. The OP has it backwards. 

  • Ann Arbor, MI · Member since 2014 · 1k+ posts · 997 votes
    6y

    @Will Barnard It sounds like you're used to dealing with appraisers who weren't dropped on their heads.  You cannot combat stupidity with logic. 

  • Bellingham, WA · Member since 2018 · 80 posts · 26 votes
    6y
    Originally posted by @Greg Moore:

    ...  I'm already bracing myself for a clown car to pull up to the property.

    This is the best thing I've read all week! 

  • Will BarnardPro Member
    Moderator
    Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
    6y
    Originally posted by @Patrick Britton:

    @Will Barnard It sounds like you're used to dealing with appraisers who weren't dropped on their heads.  You cannot combat stupidity with logic. 

    I think you missed the message I was giving in my last post. I agree many of these people have had some sort of brain injury at some point but complaining on the BP forum will not change that so you must take responsibility and help them do their job if you want to avoid a majority of the issues everyone is complaining about.

  • Investor · Searcy, AR · Member since 2018 · 52 posts · 39 votes
    5y

    My advice to all on this thread who are not exactly sure how an appraiser comes up with an opinion is ask an appraiser to do an educational class on how they come up with it. DO NOT listen to a group of people who complain. Are their good ones? yes! are there bad ones? sure! If you really want to know what an appraiser must go through look it up on your states appraiser web sight. There is some excellent stuff from Merritt S. in this thread. As far as a realtor telling you that you do not need an appraisal, RUN!!! RUN AWAY!!! That realtor does NOT have your interest at heart!!!                

  • Ann Arbor, MI · Member since 2014 · 1k+ posts · 997 votes
    5y

    @Will Barnard and yet, since my last post I have yet another major issue with yet another appraiser.  It's only a matter of time until some 13 year old programmer upends this business and sends it to its long-overdue grave.

  • Rental Property Investor · Tampa, FL · Member since 2019 · 128 posts · 166 votes
    5y

    @Patrick Britton My. Sentiments. Exaaaactly! It’s only a matter of time.

  • Rental Property Investor · Tampa, FL · Member since 2019 · 128 posts · 166 votes
    5y

    @Ricky Davis I do agree with your motion that if I have something not working well the first place I should tend to is my education. But in the matter of Appraisers, me knowing something is not going to change the outcome. I can neither hire them nor fire them even after I’m educated. 
    In contrast, I do not ask the contractors how they do their job and ask them to run an educational class for me. I just hire the ones that I have confidence can do the job and fire them if they don’t.

  • Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
    5y

    Boy, I am not getting the amount of vitriol here.

    Appraisers serve the purpose of being a sanity check and dis-interested third party giving an educated (as certified by a MAI) opinion on the value of a property.  The purpose of an appraisal is to avoid lenders and borrowers playing games like in 09-10.  The only true way to find the actual value of a property is to have a willing and knowledgable seller and buyer agree to close on a property.

    A lot of people here sound like owners I deal with that think their property is something pretty special - Like 20% above market value special.

    If you don't like an appraisal, go to the lender and make your case on why.  Remember its based on what the property is worth TODAY, not after 5 months of rehab or what it could be.

  • Rental Property Investor · SF Bay Area, CA · Member since 2015 · 206 posts · 156 votes
    5y

    @Greg Moore - Your post is so timely! I have an appraiser arriving in an hour.  This is for a refi. House was purchased for $1.55M and should appraise around there esp. with upgrades made  (I understand COVID has caused some decline in home values but a look at local sold comps should still get me around there). 

    I’m already prepared for the appraiser to be someone from out of town who will use the wrong comps. My town is sandwiched between 2 larger cities and appraisers love to use comps only from the one city with lower value homes! I always argue to use the other neighboring city. Will see how this goes. 

  • Bellingham, WA · Member since 2018 · 80 posts · 26 votes
    5y

    I had a good one (read: Crappy Appraiser) recently. 

    Value came in lower than expected, I start reading the report. The appraiser missed a half bath, lists the wrong square footage, a few other details were incorrect too. All of these details have been unchanged and listed on the tax assessor's website since the house was built in the 70's. I'm not sure we're even looking at the same house...

    I take a look at the comps, and they're all in very different neighborhoods/school districts and 6+ months old. Values were adjusted for market appreciation over time, but with an arbitrary, rounded number which was not supported. 

    He wont return calls or emails. Ignorance is bliss.

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