Appraisal Institute Updates

The Appraisal Institute (AI) recently announced updates to its HVCC Myths & Realities and Appraiser Independence Manual. “The updates clarify that appraisers are not required to provide lenders with certification that an appraisal was completed in compliance with the HVCC, and that the HVCC does not apply to commercial appraisal engagements.

  1. Bill Abalos

    When is the AI going to stop trying to defend the HVCC? It does’nt work. It’s a bad plan. Nobody likes it except the banks and AMC’s because the HVCC created an another income stream off the backs of appraisers including AI members. It’s like the AI just can’t admit they are wrong and 100,000 plus people in the real business are right. I’d like to hire all the AI admin just so I could pay them 1/2 of their former wages and expect twice as much work. Any takers?

  2. David

    I sit in utter amazement this morning as I read a front page article from CNBC on how many physicians are expected to leave the business in coming years because they cannot afford to keep their offices open. A full 10% are expected to leave over the next few years if something is not done about the healthcare system.
    In an instant I recalled the recent Working RE OREP survey of real estate appraisers. A particular question came to mind from the survey. How many appraisers expect to leave the business in the next 5 years because of HVCC? The answer was a staggering 50%!
    Consider the fact that it takes 5-7 years for a residential appraiser to encounter most of the situations they must face while becoming a professional appraiser. It is impossible to teach an appraiser how to respond to every issue upfront…they must witness each problem first hand and learn how to solve the problem while creating their valuation report.
    Consider the fact that hundreds if not thousands of experienced appraisers are currently chosing to leave the business rather than take a 50% cut in pay because of HVCC.
    Consider the fact that fewer appraisers are entering the profession now than in any previous year because of new entry requirements.
    With few entering the business, fewer experienced appraisers remaining, a forced 50% pay reduction, and a higher work load per appraisal than ever before where does that leave the profession?
    I challenge the Appraisal Institute as well as Congress to take a good hard look at these numbers in the coming months. Their physical health may not depend upon it but I assure you that the financial health of the nation does.
    The past 2 years should provide sound evidence that housing & improper valution can easily bring a nation to it’s knees.
    Where will be in 5 years when most of the pros have left the business? Unless the military has a full regiment of real estate appraisers ready to spring into action the country will be forced to rely upon AVMs and BPOs.
    Appraisers took a big step forward towards professionalism in the early 1990s with licensing. In the end it will be shown that HVCC wiped out nearly 20 years of progress in a single day.

  3. Bill Abalos

    David is right on the money. I have done BPO’s and AVM’s in the past to test drive them since it was suggested to be incorporated into the future of appraising. Not only are these 2 valuation models not real appraisals, the people behind them are worse at coercing and manipulating appraisers into giving them the value they want. Brokers and agents don’t know any better nor do they care since they do them just to get the bank listings. I no longer do either and am saddened by the killing off of our appraisal industry by those who have the real power to do something about it but won’t since their wallets are fattened off the backs of real appraisers with integrity.