Is Tech-Knowledge the appraisal “approach” of the future? Yes. Two main reasons: The legacy “three approaches” were each enabled through the technology of that day. The legacy “three approaches” were each motivated by the valuation needs of the of that day. The Technology motivations: The cost approach, first on the scene, was driven by industrialized […]
Does Evidence Based Valuation (EBV) renew – or replace — traditional appraisal process? Is this a new thing, or an old thing made better? To answer this question, we need to look at the basics. We need to compare the steps of TAP (Traditional Appraisal Process) with EBV — modern Data Science applied to valuation. […]
Are Appraisers Obsolescent? The new URAR replaces the old URAR. What’s the difference? The old was designed for difficult, sparse data, and hand calculator analysis. Nearly 50 years old in its original design, with minor changes. Three comps on a “grid.” Describe the neighborhood. Use your trainer’s “adjustment sheet.” Regurgitate and explain the uncertainty and […]
. . . But what can UAD software not do? Worth a look. Whatever the software cannot do, an appraiser (or someone else) must do! UAD is “Uniform Appraisal Dataset.” Data set. Not analysis set . . . It appears that (with minor exceptions), appraisers are expected to continue with the un-modernized, legacy appraisal process: […]
Appraisal Analysis is not a part of the UAD 3.6 “form” as required by the Fannie Mae and Freddy Mac. Critical thinking requires we get stupid before we get smart. Like: “what is an appraisal”? The commonly accepted meaning is the appraisal report. The numbers and words thing you hold in your hand, or see […]
Appraiser curriculum for today’s aspiring trainees rests firmly on “recognized methods and techniques.” The old stuff. “Methods” are a work-around for the sparse and messy data. Methods are not models. “Techniques” are procedures: Practical skills. The art. What today’s trainees actually need is an understanding of empirical models, repeatable algorithms, and brain-machine interface. Including proper […]
Current appraiser trainee requirements involve principles, practices, and standards. Unfortunately, trainees are being grounded in the old “experience” basis, instead of today’s analytics basis! USPAP Standard 1-1(a) first sentence says, “The principle of change continues to affect the manner in which appraisers perform appraisal services.” Yet appraiser-training stays stuck in outmoded ways. Recently, the same […]
The recent Appraisal Institute appeal to HUD to apply Evidence-Based Valuation Enforcement is a (nice) move in the right direction. If regulators and users begin to apply it, demand it — the appraisal profession will finally have to comply, and provide modern evidence-based analysis. Read this earlier post here. Today’s “pick comps, then adjust” model […]
We hear a lot about evidence. For valuation, there may be two relevant definitions. One would be the legal concept, the other being the “support” required to be credible, “worthy of belief.” In the law, evidence is factual information. It can be testimony, documents, physical, demonstrative, or circumstantial. Relevance can be probabilistic. Colloquially, evidence is […]
Evidence-Based Valuation Enforcement is the topic of the Appraisal Institute’s June 22 News Release. Read the original AI news release here. This recognition is immensely gratifying to me. As many of you know, I have been an advocate of EBV (Evidence Based Valuation)© for some 20 years, since I was on the Appraisal Institute’s curriculum […]
Let’s get new critical! Today there is a confluence of three public policy issues around collateral appraisal. And what has been argued as the failure of American “appraisal reform” policy. They are: The dissonance between Technology, existing practice and published standards The aging and depletion of the existing supply of appraisers The failed effort regarding […]
Technology Tech is all the rage. Some people have opinions. Some are experts. I find that anytime a topic becomes “pop,” suddenly there are a lot of experts with proclamations and declarations. Then I look up the word. Often, the writer never bothered to see what the word actually means. So I looked up and […]
Technology you buy? Or technology you sell? EBV, Evidence Based Valuation© is applied technology. The modern – today – version comprises AI, Data Science, and micro-economic theory. There are two main types of artificial intelligence: Generative AI – Used for new content creation, creative pursuits, and personalized experiences. Analytic AI – Used for data-driven decision-making, […]
We have a conflict – apply new tools and tech – now or later? Public policy on home ownership appraisal is controlled by the non-profit Appraisal Foundation’s (AF) standards (USPAP), and licensing curricula. The uniform standards, unfortunately, are not uniformly nor fairly enforced (a topic for later in this series). The most current advice from […]
The Appraisal Foundation Advisory Opinion 41 is about “when technology is used” in an appraisal. Is this a solution seeking a problem? (I use “technology” in every appraisal.) A snippy response might note that the modern electronic typewriter, with built-in whiteout ribbon, is technology – as is the modern ten-key calculator. We have always used […]
