Stress testing of regulated banks forecasts how declining economic conditions may impact bank safety. Loans, secured by real property can be significant in the overall portfolio of a bank. This property collateral portfolio itself will have different characteristics, depending on the locations, property types, and business types involved in the underlying collateral. Different properties will […]
Hybrid Appraisal Part VII: Is it possible that Hybrid appraisals can benefit us all!? Consumer heaven? Taxpayer benefit? Public trust? Hybrid appraisals are touted as being a “modernization” of the appraisal process. Simply put, a non-appraiser does the inspection of the property, there is no physical assessment of the neighborhood nor any of the comparables. […]
Hybrid Appraisal, Part VI Is it possible that Lo-Brid or even No-Brid appraisals could be even faster and more cheaper? Hybrid appraisals have been hyped as being a “modernization” of the appraisal process. While the appraiser still fills out the “Fannie Mae” form, the actual property visit is done by another person (with as yet […]
What is an adjustment? In a prior blog, we noted that no one seems to really know! We looked at the AI Dictionary of Real Estate Appraisal. We looked at The Appraisal of Real Estate (TARE). And we looked at the “Uniform” standards. All these sources tell us that adjustments are important and should be […]
And change it does. The biggest changes slip in almost without notice. USPAP recognizes change. In fact, Standard 1-1 says: …the principle of change continues to affect the manner in which appraisers perform appraisal services. It specifically recognizes change in cost, construction, marketing, law, lending all lead, or should lead to corresponding changes in appraisal […]
Price indexing is a result of a good market analysis. What is it, and how can it help? Price indexing solves many of the problems that the 1004mc was intended to do. It is not difficult to do. The result looks something like this: If you do this using the recommended specific procedure, you will […]
We know there is science in art. Musical scales. Perspective and the golden ratio. The ordered sequence of a good novel. It’s difficult to be a good artist without knowing, or at least intuitively applying the truths found in the logic. Both science and art reflect our search for the truth. Our primal human nature […]
An opinion of value is just that. Everyone has one. Asset value is wanted for one of three reasons: to measure risk, forecast profit, or to achieve fairness. Mostly the clients are collateral lenders, investors, and regulators/litigators. An appraisal is an opinion of value by an appraiser acting in appraisal practice. There are other opinions […]
A “hybrid” appraisal is a new name for where the property inspection is separated from the analysis and appraiser’s certification. It is faster and cheaper and. . . This is Part 5 of a (soon to be, so far) six part discussion of Hybrid Appraisals. Part One, Two, Three, and Four are behind these links. […]
If you pick comps the old way, you may be violating USPAP every day! The old way of selecting data worked well for the old days. Gather seven or eight that look good, go look at them, make a couple of phone calls, and pick four or five for your report. That was the way […]
Appraisers have been taught to first analyze the subject property. Is this correct? What would an economist do? Would she analyze the property, or figure out the market? Well yes, an economist would try to figure out a market. First, it’s important to consider what type of market we are talking about. What are the […]
Digital disruption is what happens when new data technology and new business models crash into the old goods-and-services ways of doing things. But of course, this cannot possibly affect appraisal. After all, appraisal is about judgment, sharpened by years of experience, education and training. But it’s worth a look. Is it possible? Several causes of […]
You did a bad—a USPAP violation! They said so! Are they right? A violation. A strong word. Clear and succinct. Easily understandable by anyone. Of course. Black letters on white. Where in USPAP does it identify (for real property) what is a violation or not? We can look at three parts of USPAP; First there […]
We believe we know what we know in four basic ways. Do you know which one is you? Charles S. Pierce identified four basic ways we come to believe that we know what we know. It is interesting, for my own benefit, to understand how my personal beliefs came to be, and how the general […]
Vintage appraisal focuses on a point value opinion. In reality, clients need help with estimating collateral risk, or investment potential. Risk or reliability, if measured, is the uncertainty of the analyzed result, or the opinion of value. Lenders, investors, portfolio managers today are aware of the power of today’s technology. They need a measure of […]
