What would make a perfect appraiser, and also who are the perfect clients?

August 09, 2012 - Appraisal & Consulting

William Pastuszek, Shepherd Associates

At the heart of any appraisal lie the appraiser’s opinions. Appraisers know, deep down, that they are right, since it so hard to be proved wrong. Even if wrong, many appraisers think they are probably less wrong than their peers, appraising being the imperfect profession that it is. Most appraisers would defend their opinions down to the last bitter swallow, even if they are flawed and the flaw is obvious and is not supported by the marketplace. Appraisers revel in being “legends in their own mind,” and expend considerable energies in finding clients that agree with that opinion. I’m not the only one to have noticed this, but I am not entirely sure that licensing has created a more competent profession. In many cases, appraisers’ training is still eclectic and catch as catch can. Despite the promise of technology, the internet, etc., many appraisers seem to work in a virtual bubble. With on line training and the ability to conduct business on smaller and smaller devices becoming the norm, we barely see each other any more. Along these lines, I began thinking: What would make a perfect appraiser? • Appropriate and credible education; • Years of experience working under other highly skilled and widely experienced appraiser(s); • Working in firms that have a motivated and competent set of associates with which to share problems, experiences and data; • The ability to train successfully early on without having to worry about production; • Training in technologies and demonstrating the ability to apply them appropriately to solve appraisal problems ; • Exposure to interesting and knowledgeable clients (more on this later); • Access to the right information sources, and; • The ability to be able to make sense out of them; • The ability to identify those development and reporting aspects applicable to the intended use and not applying a one size fits all solution; • Not relying completely on what the client thinks they need. Exercising some appraisal due diligence and professional common sense; • The ability to write a report that meets the needs of the client and intended user; • The desire to produce an appropriate report whose content is not measured against the fee being paid but against the valuation problem being addressed; and Judgment, integrity, and honesty in the conduct of an assignment. This all adds up to competency, and a little bit of ethics. And, a lot of common sense. Some of this, you may say, can’t be taught but a lot of this is not being learned, either. Most appraisers, given five minutes with another appraiser, will begin talking about dealing with clients. I strongly encourage not breaching confidentiality when doing so. Having considered what would be the make up of a perfect appraiser, what would make a perfect client? (These comments do not apply to any of my clients!) • Providing sufficient information at the outset so that an adequate scope of work can be developed; • Providing sufficient time to complete the assignment appropriately; • Lack of pressure for a predetermined or hoped for result; • Providing an adequate budget for the work to be done; • Providing additional information as it becomes available; • Clearly setting forth delivery dates and not changing due dates a week before the engagement; • Being clear about intended users and intended users; • Not creating scope “creep” without offering to change the terms of engagement; • Using the appraisal as a decision making tool. The business environment is challenging. Both appraisers and clients have to work together as professionals. Enjoy the rest of the summer! William Pastuszek, MAI, SRA, MRA, heads Shepherd Associates, Newton Mass.
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