Appraisers are paid for their thinking, as well as some other skills.  If there is no thinking, it can be called an “Automated” appraisal.

Thinking is defined as giving thought to consider or reason about something – using rational judgment.  Thinking about thinking can cause discomfort.  “What will people think of me — if my thinking results in a different opinion than I had before.  How embarrassing!”

How bad.  As an appraiser, I am paid for my opinion.  An opinion which is “independent, impartial, and objective.”  Then it gets worse.  I am paid for a credible opinion.  And “credible”  is defined as “worthy of belief.”  So I must strive for worthiness.

Of course, we all know that we achieve worthiness by supporting our belief.  Fortunately, USPAP (Uniform Standards of Professional Appraisal Practice) give us clear rules on how to do worthy support.  There are two clear rules for scope of work which is “acceptable.”

1. It meets the expectations of appraisal users.
2. Our peers would act in the same way.

First, regularly intended users are generally lenders, for “federally related transactions.”  Their expectation, at a base level, is that a deal will be made.  If this expectation is not met, well, it’s translated to the words “you screwed up our deal!”  Today, it’s politely called a reconsideration of value (ROV).  You can change the words, but a stinky flower is still a stinky flower.  (This single issue is probably the core of our last two real estate-related market crashes.)

Second, like my peers — do not venture into any new available data, logic, facts, analytic power, or critical analysis methods.  Stick to four or five comps which are convenient, support your belief, and reflect your very, very careful judgment.  Trust me, I know a good comp when I see a good comp! No need to do market analysis when you have such excellent judgment.  (Or just do it later, if they yell at you.)

Do not consider beyond your judgment data.  This helps ignore other factual or discoverable market information, avoids showing visuals, summaries, and numerical evidence, and avoids having to learn that new-fangled “science of data” stuff.  Best of all, it avoids having to critically confront your own pre-conclusions.

Heck, complete data and rigorous analysis might cause me to rethink my personal, professional, trained sense of self.  Trouble.  Who needs it?  It just doesn’t feel good.  Let’s not think about it!

Path number one.  Do not think about it.  Continue doing it the way we’ve always done it.  Much safer.  Comply with the old standards, with the old process as taught by our forbearers.  With state laws requiring compliance with the old ways. With old habits, and old ways of thinking.  Let’s not think about thinking.

Path number two.  Think about thinking.

As I started this topic, and researched it, and considered why it might matter – it grew.  It is likely to be a multi-part blog topic.  What I know so far, is that future blog posts will consider at least the following:

• Critical thinking about thinking, a core stream of our professional skill;
• Reasoning, a science river of intelligence: Abductive, deductive, and inductive;
• Uncertainty, as it soaks into everything we measure, contrast, associate, and sequence.