We’re pleased to have my friend and long-time student assistant, Joseph Lynch from Sacramento, CA, write this week’s blog. He’s certified in residential appraisal, working in Northern California, and is President of the Sacramento Chapter of the Real Estate Appraisers Association. Check out Joe’s blog here.
Thank you, George, for inviting me to pinch hit this week for your blog. A little more about my background: I graduated in 1990 from UC Davis with a BA in Economics and a Math minor but couldn’t find work. I ended up in the IT department of Valley Record Distributors, a music and video wholesaler. Besides system testing and development, I learned about querying databases on an IBM AS/400 computer system. The best part of my job, besides a lot of free music and meeting cool musicians, was this data analysis.
The company blew up in late 2001 putting me out of work. But my brother-in-law knew an appraiser who wanted to expand his appraisal business. He put the two of us together and I started as an appraiser trainee in mid-2002. I found myself in a “sink or swim” style of training, where the goal was “3 comps and a listing” and move the report along. Fortunately, I had a reasonably good understanding of what a comparable was so my reports were not the worst in the world.
You Don’t Know What You Don’t Know
And I didn’t know what I didn’t know until I started taking classes from instructors like Barry Cleverdon in Roseville, CA.
Barry started an appraisal school and taught classes along with bringing in outside instructors. I remember Steve Smith (on the National Appraiser’s Forum) encouraging us to upgrade our skills and move up the food chain to better work and better clients. Anthony Young spent a day fighting with three different versions of Excel but showed us how graphs could be used when appraising. And then I took Stats and Graphs from George.
The Stats and Graphs class opened my eyes to a better way of doing appraisal. For the first time, I saw how appraising tied into my past experience in data analysis. I started exporting comparable data into Excel and making graphs showing market trends. I experimented with pivot tables and came up with ways of reporting market activity and estimating adjustments using grouped pairs analysis. My reports became better supported, and more reliable. I moved up that food chain to better clients and better assignments.
I spend a lot of time on graphs to understand the housing markets in my area. I no longer guess how much prices change. I know the daily price change and make reliable, indexed time adjustments. My job changed from “pick the best comps and fill out the form”. Now, I analyze the all of the relevant comparable data to estimate an analyzed answer. I’m back to my earlier role as an analyst. Appraisal is fun again.