Credibility is defined as “worthy of belief.” The entire foundation of legacy appraisal practice and standards is “credible.” The word “credible” is found 289 times in my most recent USPAP edition (Uniform Standards of Professional Appraisal Practice). Wow. It must be important! The word “worthy” is found only once! And that is to help define […]
Scope of Work for an appraiser is an overriding consideration. In USPAP (Uniform Standards of Professional Appraisal Practice) it is nicely described. Once the “problem to be solved” is identified, the appraiser is to: Determine work necessary to solve the problem; Correctly complete research; Correctly complete analysis; Produce a credible These words seem obvious and […]
A new Scope of Work may require a better, modernized analysis – Intelligence Appraisal. Intelligence Appraisal (IA) combines AI with human intelligence, built on the science of valuation. The new UAD reports enable and even require a new appraisal development competence. Editor’s Note: This is a part of a series on Appraisal Intelligence. Read the entire […]
Early in my career, there was no “Scope of Work” part in the appraisal standards. The appraisers that trained me, however, did tell me it was good to figure out the problem, the property, and the perspective needed. My academic history told me: oh – yea! Kinda like a hypothesis! Editor’s Note: This is a […]
I just read these words “epistemic persistence!” Had to look them up! Last week’s blog talked about the power of words. On discovering these new ones, I was gobsmacked (another cool word)! These two words together concisely describe what has been bothering me about the appraisal function (and many other things we humans seem to […]
Last month, I started the series on the impact of artificial intelligence on appraisal. It seemed it would be an easy topic, one which would expand to challenge and forecast the future. And the deeper I went, the easier it went, and the deeper it went. How deep? I quickly realized that much of our […]
An appraisal is an opinion of value. It is not the report! Nearly all recent hullabaloo about modernizing has been led by the big customers: FannieMae and FreddieMac. The “UAD” and “new URAR” is about the report. Not your analysis! Yes, the report does affect the analysis. But it is not “the act or process […]
On March 13, the President’s office ordered actions “Promoting Access to Mortgage Credit.” An Executive Order. Read the full document here. This President’s order sets goals of “reducing lending costs” and to “remove regulatory distortions” to “the structure of the mortgage market…” Section 6, Appraisal Modernization, states: Modernize appraisal regulations and guidance; Expand the use […]
Once a valuation problem is “properly” identified — the next step is to determine the scope of work necessary… (Per USPAP – Uniform Standards of Professional Appraisal Practice). Intelligence Appraisal, using AI, provides a more realistic objective/defined test – for both the problem identification and the scope of work. Intelligence appraisal incorporates appraisal science. So, […]
Intelligence appraisal does not appear in a vacuum. The process follows the same sequence as does the traditional paradigm. The difference is in the tools, the technology, AI, and a sharpening of judgment in the underlying econometric theory. Intelligence Appraisal incorporates Evidence Based Valuation – EBV. Appraiser experience in legacy routine and thinking are the […]
Intelligence Appraisal uses human intelligence combined with artificial intelligence. The human intelligence role combines art, knowledge, and skills. Art involves how to interface with the AI agent, knowing the underlying theory of the analysis. This can be creative, and recognizes emotional aspects of human behavior. Knowledge means both the subject matter, and the right use […]
Artificial intelligence is a blinding light through a stormy hole in the sky. Punctuated at times by lightning bolts. People yelling “look out.” All this, in a world of UAD and “new” requirements like for time adjustment! Whew! Gonna quit. Gonna retire. Gonna see. Gonna wait. Let’s see how it goes. Fight, flight, or freeze? […]
Does artificial intelligence require appraiser intelligence? This idea opens up a whole series of questions that need to be answered. A lot. And we need to be smart about how we look at this. Are there other forms of intelligence? What is intelligence? Are you intelligent? Does valuation require intelligence? And if so, are there […]
Valentines Day means different things to different people. Most people connect it with the word “love.” How does this “love” thing work? First, as always, we need to define what love is. What is it? Love means different things. It tends to reflect one of two concepts: A platonic, non-romantic nor sexual, but selfless attachment […]
Probably the most probable definition (of value) in use in the U.S., is used for “federally related transactions.” The underlying assumptions assume “normal” or “typical” conditions. The “most probable price.” “Most probable” presumes you can attach certain levels of possibility to different values – then just pick the one value which is the “highest” probability. […]
