High volume of loans worsens appraiser shortage - by Maria Hopkins

Maria Hopkins, Maria Hopkins Associates

We are in the middle of a very busy summer market at the same time refinances are booming due to continued low rates and talk of them going up. The appraiser population is aging (and not so gracefully) and there are continued barriers to entry for new trainees. Not only are there many reasons why no one wants to train new appraisers but now they have to have a college degree which I think was a big mistake. Having a degree does not make a person professional. Requiring specific relevant college level classes would have been better.

Also, all the lenders now only want the higher licensed Certified Residential appraisers inspecting and appraising the properties even with a supervisory appraiser taking responsibility and signing the report. The process of even getting a trainee license can be lengthy. There is talk of at least allowing basic licensed appraisers without a degree to upgrade to Certified Residential with the additional experience and appraisal education. Too bad that didn’t happen before my best appraiser spent over $10,000 to get the additional college education to upgrade. She has over 15 years experience and is one of the best appraisers I’ve ever met. The degree did not make her more professional. The argument is that it makes appraising more of “a profession.” I disagree. The appraisal education itself and the experience requirement and the supervisory requirement make it a profession.

For the last few years many of the Appraisal Management Companies (AMC’s) have been putting appraisal assignments out to bid to the cheapest, fastest appraiser because they want to make as much money as they can. This system meant that often the appraisers doing this work were not that experienced or locationally competent often driving from out of state or very far away just for that one assignment. Obviously that meant it was the only type of work they could get. That system created unprofessionalism in the industry. Now there is a huge appraiser shortage and those same AMC’s can’t get enough appraisers to meet their contractual obligations so they are offering premiums if appraisers will take them. There is no relationship base and therefore no loyalty from their appraisers. The qualified appraisal firms have no motivation to take the assignments even at really high fees because they are struggling to take care of their good long term clients where there is a relationship and mutual loyalty. The increase in appraisal volume was quick and overwhelming and it takes time to train more administrative staff never mind appraisers, so most appraisers have had to choose which clients to stop accepting assignments from. This is a painful thing for a business owner to do, especially if they remember what it was like when it was slow. But it is necessary in order to get turnaround time of assignments back down to an acceptable time so loans can get closed.

Even with all the changes and struggles I still love what I do every day after 31 years. I am training family into the profession which takes years, but is very rewarding and will keep me going no matter what.

Maria Hopkins, SRA, RA, is president at Maria Hopkins Associates, Spencer, Mass.