Hairy scary hybrid parry. Let’s look deeper, now that we seem to be away from the original hype. When this thing first came up from the GSEs (FannieMae and FreddieMac), a hybrid appraisal was narrowly defined. Basically, it separated the desk job from the field job. I was even in a room once where the […]
“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 […]
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? […]
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 […]
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. […]
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 […]
We read articles and advertisements on how to prove an adjustment. Is this possible? How wonderful it would be. To prove an adjustment, just push a button and bam! Out comes the correct answer. How could we have we missed this? Of course, if such a simplistic and exact answer was possible – anyone could […]
Why should they trust me? Trust me. I am an appraiser. I am trained. I have experience. I have high ethical standards – and a government-issued license which says so! What more could you ask? What more could you ask? To answer this question, let’s look at what the client needs and what is the […]
Is the profession dying? Do we save it? Or change it? How does EBV © make things better? How can it be better for appraisers? For lenders? For investors? For litigation? We have several questions. These are each worthy of a look. To this end, this will be the first of several parts, to see how […]
Who cares if it’s reliable? It only needs to be “credible” – believable. Credible: “Worthy of Belief” Reliable: “Repeatability of findings” Credibility comprises both trustworthiness and expertise. It has both objective and subjective elements. One can also increase credibility by being a good salesperson by convincing the reader of your viewpoint. You form an opinion, then […]
I saw an article from the Washington Post, December 15, 2017, saying the administrative/enforcement branch of the U.S. government is banning the use of certain words or phrases. Two of the phrases include “science-based” and “evidence-based”. As many of you know, I am an active advocate of Evidence Based Valuation.© If valuation based on evidence […]
Every profession I know that deals with numbers also provides some estimate of the reliability of the result. An engineer would not say “the most probable life of this bridge is 87 years.” The engineer might provide a minimum, or a range, or some indication of how reliable the estimated life is. My new journal […]