If you are shopping for an appraisal based only on fee, be careful. Perhaps you should also ask the appraiser how many appraisals they do per day. As real estate appraisers who do all of the work necessary to produce credible results, it is frustrating when we hear about others who brag that they can do typical Uniform Residential Appraisal Reports (URAR) in two hours, or many appraisals in one day. Do not misunderstand. We at A Quality Appraisal are innovators who embrace any technology that will increase our productivity. Just take a look at the seminar I taught on Three Steps to Mobile Appraiser. However, we are nowhere close being able to complete a URAR in under two hours.
Today I received an email from an appraisal software company listing one appraiser’s claims as to the time it takes him to complete an appraisal and asking me to guess his software. His appraisal timeline follows the video:
I have the following problems with the above 1:14 timeline:
1. “Running the MLS.” This appraiser says it only takes 15 minutes to pull the comparable data and the market data. It takes our office up to one hour to pull the best comparable sales and the best market data, and sometimes longer for a complex property. Yes, we could run one quick search for comparables and export the same data for our market analysis in under 15 minutes. However, we have a systematic approach to comparable searches that ensures accountability of each search, why we did or did not select comparable sales, and ensures that strong comparables are not missed. Our market conditions data is also carefully controlled to assure that we are capturing the most accurate picture of the micro market that the subject property would compete in. Often, market analysis takes looking at our results, identifying outliers that are skewing the data, and changing the search parameters for a more accurate representation of the market.
2. “For the inspection.” This appraiser says the inspection only takes 22 minutes at the property. I too use a tablet computer in the field and I am very quick. I could, if I rushed, take only 22 minutes at a 3,737 sf home. However, if I did this, my head would be directed at my tablet the entire time, rapidly entering data and most focused on measuring. I would not have much time to ask the owner lots of questions and absorb all of the things that make every property unique. I have been called out countless times as a second opinion on an appraisal and the person showing me the property says something like, “The other appraiser was only here for about fifteen minutes.” My typical inspection takes about 45 minutes and I too am done with page one of the URAR in the field. Since I use a “desktop replacement tablet”, I don’t have the lost time that this appraiser has of transferring to the cloud and moving from one device to the other.
3. “Completing….” This appraiser says it only takes 24 minutes to import three sales and two listings, and then do a final read thru. From what I can see, this is an appraiser who is only focused on form filling. Granted, this is an advertisement for an appraisal form filling software. However, FORM FILLING IS NOT APPRAISING! A completed form does not mean a competed appraisal. In this timeline, there appears to be no time spent on other approaches to value, supporting adjustments (hopefully this software has some automated regression tools), analyzing and explaining data, or reconciling. My staff and I typically spend hours doing this. There also appears to be no time spent communicating with parties to the transaction to verify data and find out the details behind the scenes. Data confirmation can easily take an hour or more, but it is important in a well-researched value conclusion.
Appraisers should be outraged when they hear stories like this of typical appraisals being done in less than two hours. With the current state of poor quality real estate data and the technology available to appraisers today, timelines like the one above are only possible when the appraiser uses the same boiler plated garbage that is said on every appraisal assignment. Advertisement for software or not, appraisers who make statements like this undermine the ability for other appraisers who are doing quality work to obtain a reasonable fee for their time and careful analysis.
If there are ways to complete a credible URAR in less than two hours, I am in. Statistically driven automated tools are the future of appraisal. Unfortunately, “professionals” who produce a report this quickly today do more than just cut corners; they overstep entire components, which affect the credibility of the conclusion. If you think you have received a low quality appraisal, check out my blog post on how to spot and dispute a bad appraisal.
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Thanks for reading,