What is “Modernizing”? What is “Appraisal”?
This is the first in a blog-series to look at “modernization” from the viewpoint of the appraiser analyst, and not the view of the client-user report.
In the valuation world, the word “modernizing” has been commandeered by the GSE’s (FannieMae and FreddieMac) who give it a particular meaning. Primarily, they mean it to be the new cloud-based delivery/reporting vehicle, URAR – Uniform Residential Appraisal Report. Basically, this is a shift from legacy rectangular typewriter paper restrictions, to visual dashboards, picklists, and dynamic reveals.
Critically, 1) it is a new reporting method; and, 2) it places an expanded data-gathering requirement upon appraisers. (This added data may or may not be needed for appraiser analysis or judgment). In addition, the appraiser may need to rely on information not covered by the specific URAR fields!
The new URAR is not a new appraisal development/analysis mechanism!
If we are to discover what this profession is about, and what this blog series is about, we need to “Dunning-Kruger” our words . . . And let’s be sure we are talking the same thing!
“Appraisal” is “the act or process of developing an opinion of value.”
“Modernizing” is “adopting ideas or methods, relating to the present.”
An “appraisal” is not the report, even though, colloquially, we call it that. An appraisal is the process, the model, the algorithm, or edible judgment.
This blog series will consider the past, the present actual, the present possible, and the future probable! (Including the role of artificial intelligence). Specifically, we listen to the roar of history – traditional legacy appraisal, and how it settled into the muck of the “five frictions” of inertia. We consider how society and technology have progressed. And we see how the embedded groupthink keeps the appraisal profession stuck in place, while competitors are waived through the checkpoints.
Most importantly, we will see how the fragmentation of the valuation product – by method – again threatens the public good and the public trust. The next economic meltdown will be the same, but different. It may not be as bad, or it may be worse.
Worse yet, the fragmentation today is not just by method. It is also by risk type. This, in a manner which conveniently avoids the public interest part of potential damage, but encourages and leans on the desire to “make a deal,” a loan deal. The “black swan” risk, the long-term economic risk of a loan can be put back, hidden, or just ignored. Take the gain today, put the loss tomorrow (for someone else).
Value, taken alone, is not the whole of property risk. And value alone does not include the other types of collateral loan risk or portfolio risk.
Of necessity, we will consider the “science versus art” issue. We will parse the word “judgment” in the context of expert judgment. In particular, we will evaluate the evolving role of artificial intelligence (Ai).
We will consider the danger to vocational appraisers, the discomfort of professional appraisers, and the broader world of consultants and asset analysts.
We will look at the past of valuation, its fragmentation, its ‘frictional’ stagnation, the expanded needs of clients, and the obvious path to better service, better usefulness, and its potential role in a basic human need: housing.
January 5, 2026 @ 7:38 am
There are many hidden nuances that only an intuitive knowledgeable appraiser can value only with logic and with common sense . Even with these exceptional abilities it still makes appraising ones best guess. But what makes a good appraiser is one who is first aware of this challenge in the first place . In todays market unfortunately even the best appraiser seems beaten down by buyers whims of duress in a sellers market Basically logic goes out the the window.
Hence , no matter the procedure one can not develop logic out of illogical sporadic data.
Mr. Lawrence Eric Fenimore –
50 years experience.