What is common sense? How well does it work? Who has common sense? Who doesn’t? This should be easy. Common sense is common. And it must make sense. It means every one should have it. Sense means perception: sight, hearing, touch. Sense can also mean a feeling about something; a realistic attitude about things; or, […]
Can we think about critical thinking? What does it have to do with appraisal? The word is used many times in USPAP (Uniform Standards of Professional Appraisal Practice) and The Appraisal of Real Estate. However, it’s only used once each in the context of thinking. In USPAP, it’s in Advisory Opinion on Scope of work, […]
New technologies require new skills. The bad news is that new data science skills are not taught in appraiser education. The good news is that the new technologies are things an appraiser can sell. Let’s look at the good news! Data science skills include the ability to: Identify the relevant data. Turn the data into […]
Last Year’s “holiday” blog on gratitude was very popular and is linked here. The post speaks on the importance of appreciation for a happy life. The list (in the post) is intended as a practical application of brain science. But does an attitude of gratitude make you money? This question caused me to rethink the […]
Can we compare “statistical adjustment” methods to traditional appraisal adjustment practices? ‘Adjustment’ is mentioned only once in USPAP; (Standard 5 on mass appraisal). However, in The Appraisal of Real Estate, “adjust” comes up 687 times! It must be important. Surely, it’s clearly explained. In each use, the context is critical. It states: ‘Adjustment’ builds on […]
Can science be unscientific? Why do we care? In USPAP (Uniform Standards of Professional Appraisal Practice), the word science is not used. Not once! The word scientific is used only in Advisory Opinion 9, where it refers to “scientific aspects” of environmental contamination. In The Appraisal of Real Estate, 14th ed. the word is used […]
“General” appraisers may not care about the 1004MC (market conditions addendum), or its replacement. But they should care about what happens next! The 1004MC was created by Fannie Mae/Freddie Mac in response to the economic meltdown around 2009. Appraisers were blamed. Everyone else tried to avoid looking culpable. Especially those who had profited greatly. Our […]
What are the elephants in the room? The elephants are our beliefs. These are the beliefs we all assume to be true. Let’s look at the first of our herd of elephants: number 1 – judgment. We often hear it said that no machine can replace human judgment. Or that appraisal will always require someone […]
We seem to be hearing stuff about risk recently. Why? Back in the old days, before internet but after the wheel – It was my challenge as a new appraiser to scratch together four or five comps, then put three of them on a form, or perhaps even all five on a table. We called […]
Asset Analyst: More than an appraiser? It is clear that the need for personal value opinion is going away. Yet the old appraisal practices and standards require an opinion. The new way is cleaner. Show your work – Just like your third-grade teacher told you. The old standards focus on the appraiser. The new standards […]
How does price validation differ from your traditional appraisal opinion? One of the arguments against the value of appraisals is that appraisers almost always just land on the sale price. How does this happen? Why? There are some obvious answers. The market system works, so the sale price should be near “market value.” Pressure exists […]
If you are disrupted, you can plant your feet in fear, and not change. If you are disruptor, it’s wise to know the game and play your best position. So what do we need to understand about “data disruption”? Several things: I have seen a list of nine such general principles. So lets see each […]
In Part 1, we saw that context is important in the use of an algorithm. In Part 2 we note the role of algorithms in modern asset analytics — the data science valuation view. The “problem to be solved” is the context for the use of algorithms. But what are the benefits of algorithmic thinking? […]
Three different types of clients , one appraisal type. Does this make sense? Different user-clients have different needs. Lenders need to know the potential for loss, to balance against the benefit of monthly payments. Investors need to know what their potential income flow will be, and/or the probability of gain on sale. Other clients, such […]
An Algorithm can leverage appraiser market knowledge and experience. Algorithm combines computer power with informed human brain power. Algorithms are the key to the future of valuation work. Let’s continue on from What is an Algorithm? Part 1. The future appraiser must own competencies in the use of models, algorithms, visualization, and the delivery of […]
