The Appraisal Institute says appraisals are not to blame for home values plummeting and appraisals coming in low.
In fact, the group, in a statement, says the message is clear: don’t shoot the appraiser.
That message is arriving at a time when homeowners are desperate for value and buyers are shopping for deals in a supply-rich market, forcing appraisers to fight harsh criticism when the sales contract price is higher than the appraised value.
Appraisal Institute President Sara Stephens claims it is nonsense when real estate agents, homebuilders and others blame appraisers for current market conditions.
“The fact is that appraisers are undertaking the same thorough research and thoughtful analysis that they always have in order to continue producing reliable, credible opinions of value,” Stephens said. “Don’t shoot the messenger.”
She says qualified appraisers know how to appropriately account for distressed properties when conducting their home reviews.
“Designated members of the Appraisal Institute have achieved levels of education, experience, standards, ethics and peer review above those of licensed or state certified appraisers,” she said. “They are particularly valuable when facing challenging assignments like those found in today’s market.”
Still, appraisers have been in the firing line since the market bubble, with earlier critics suggesting appraisers contributed to the run-up in home values with inflated appraisals in the boom time.
Two years ago, MBA panelists attending the Mortgage Bankers Association’s Quality Assurance and Residential Underwriting Conference in Grapevine argued it’s time to ensure appraisals are checked and re-checked by industry players. At the time, Kathy Coon, chief appraiser and director at FNC Inc. said, “Just because an appraiser is licensed does not mean they are qualified.”
Stephens, meanwhile, is out front defending professional appraisers who are designated members of the Appraisal Institute from unfair criticism.
“Appraisers don’t set the real estate market; they reflect what’s happening in the market,” she added. “Think of the appraiser as a mirror, reflecting the market. Obviously, the market is depressed — home prices have fallen far below the values of a few years ago. Many homes simply aren’t worth what their owners think they are.”
Now the institute is dealing with accusations that low appraisals are killing home sales. In response, Stephens said appraisers are reflecting the true market value back to buyers and sellers.
“Designated members of the Appraisal Institute have achieved levels of education, experience, standards, ethics and peer review above those of licensed or state certified appraisers,” she said. “They are particularly valuable when facing challenging assignments like those found in today’s market.”
Write to Kerri Panchuk.
