Have you ever written an online review about a company, service, or both? In the year 2020 I would imagine you have. We live in a society now where the online review(s) is critical in the decision process when choosing to hire a professional or buy a product on Amazon.
One thing I have noticed within the last several years is that most (not all) online reviews regarding appraisal services, particularity residential real estate, are negative. One trend I have seen develop is how people are reviewing the “service” that was performed. The following will contain some reviews I have found on the internet and some discussion regarding them and some of the issues I see with the negative reporting. The people that wrote them and the companies they are about will be redacted but grammatical errors remain.
“The flyer they give you says the appraisal should take 30 minutes to an hour. The man that came to our house was here for MAYBE 10 minutes (that’s including the time he spent outside) and that’s being awfully generous.
Then when we received the final appraisal sheet he listed the wrong square footage for our house, so who knows if it was even actually our house?
The value he came to didn’t make sense to me even after speaking with xxxxxxx to clarify what the itemized lists meant. He valued our home at 20% less than a literally identical house directly across the street from me sold 6 weeks prior to his appraisal lol. In the end, the weird appraisal didn’t hurt us for what we were doing so it wasn’t worth it to me to fight them but buyer beware. This is what a $500+ appraisal buys you.”
So here we go. While I won’t comment on the consistency of an appraisal firm’s advertising and actual site visit time, I will say that IF this appraiser was doing a diligent site inspection a 10-30 minute period could be sufficient depending on the size and complexity of the property and what information/data the appraiser found or was provided before the site visit. Of course, we are not given that information so further assessment can’t be performed. “Wrong” square footage is something appraisers hear ALL THE TIME. Most individuals believe that the government tax records are the bible when it comes to their property. 9 out of 10 appraisals I perform an appraisal, the actual dwelling size of a residential property is not the same as the tax records. This is mostly due to “mass appraisal” methods performed by taxing authorities which are very different from that of an analysis of an individual property. The question here is: was the person provided with a copy of the full appraisal report including a physical sketch and to what standards was the sketch derived? If the analysis was properly reported, the “identical” house across the street that sold 6 weeks prior should have been, at the very least, mentioned within the report and if it was omitted from comparison, a short statement of the reasons why. Remember: “wrong” is a subjective term in the appraisal business. Ask the appraiser “how/why/where/when/who” instead.
“Just recently had an appraisal done. Home owners beware they will underestimate your home value. Just 2 years ago my home appraised for $ 209, 000. We just had a new energy efficient AC installed and a new roof and some how xxxxxxxx valued it at 205, 000. If a mortgage co.uses this xxxxxxx appraisal you should demand a different appraisal company. The appraiser didn’t even look in the attic, he just took pictures real quick.
In response I got, the prior appraiser did not inspect the attic but he did take pictures. Maybe that appraiser was wrong in doing so. However I have no need to ever do any business with xxxxxxxx appraisal and still do not recommend them unless you need your home under valued for tax purposes.”
This topic is also something I see quite often. HVAC and roof systems are typically viewed as “maintenance items”; such items that contain an economic lifespan and are expected to be useful for a time much less than the total economic lifespan of the real estate. The industry refers to such items as “short-lived” items. The idea behind the cost to replace these items is that if they needed replacement; the market would most likely not accept the full potential of the real estate; thus, a “diminished return” may be created from the cost of the item and how the market accepts it. Remember: cost is what you pay; value is what you get. Most people also do not understand the difference between a licensed home inspector and a licensed real estate appraiser. The home inspector is the individual who is licensed to perform an analysis on a property’s components and condition of the structure where an appraiser is licensed to provide an opinion of value per the standards of USPAP. These are two totally different jobs independent from each other.
“Beware of this company !!! They cost us $14,000 because the appraiser could not count the number of rooms in a house! They would not return any of our phone calls and refused to respond to emails. If your lender is using this company it might be cheaper to go with a new lender.”
This one is not very descriptive but brings up a few good points. It is common for appraisers to not answer the phone when they know that a person is calling about an appraisal that was performed and the opinion of value did not meet or exceed a “beneficial threshold” for a party. Why? A few reasons: 1) when a lender orders an appraisal, they are identified as the “client”. In most lending cases, the borrower of the loan most likely will end up paying for the appraisal that the lender will order. This does not mean that the borrower is an identified client of the appraisal or to the appraiser. The appraiser in this situation does not owe; nor can they discuss aspects of the report with a party unless the appraiser’s client (the lender) give permission. This tends to be a very difficult thing to explain to a borrower or seller when they are already upset with the results. Most lenders offer a reconsideration of value process to their client’s which is the process one should go about instead of calling the appraiser directly. Remember: if you are borrowing money from an institution that requires an appraisal; the appraisal is for them, not for you. It is highly recommended that you solicit your own appraisal as well. Note: I am not suggesting that appraiser’s avoid phone calls or emails as my firm is trained on how to handle these situations and direct these calls to the proper channels.
“Appraiser was in my home less than 10 minutes, used outdated comps and the information from when I purchased the house six years ago in making an inaccurate assessment. Called my four bedroom home a three bedroom because the the fourth “would have better function as a den” in their opinion. Completely rude office manager. BEWARE!”
Lastly, I will use one of my firm’s own reviews. This can be found on “yelp” if you care to go read it in its natural habitat. I use this last as I can attest for what the issues are and why this individual was unhappy with the opinion of value my firm developed and reported. This home was approximately 1,800 sqft and is located in an urban and homogeneous area. The appraiser was on site approximately 18 minutes which was plenty of time (in this case) for an appraiser licensed for almost 20 years to be able to perform the necessary site visit to produce credible results. The home is set up with the true bedrooms on one side of the dwelling away from common areas. The master suite contained an adjoining bathroom and the two secondary bedrooms contained a jack-and-jill bathroom. I will note that this 3/2 set up is very common in this particular market. The “4th” bedroom spoken of was located directly from the front door foyer and did not contain a built-in closet. The space had external cabinet style closets that were not part of the original finish. While this room could function as a 4th bedroom as it contained all necessary criteria; we concluded that the overall market would likely accept this as an additional common living space. In fact, we called it a “Den/Flex Space” in the appraisal. Our client, the homeowner, was literally enraged over the phone about this. Enraged beyond the point that the individual would not listen to our explanation on why we opined the space as we did, even though it was concluded within the report very professionally. The information used from 6 years ago was salient facts regarding the structure and legal information, which had not changed as of the effective date of our appraisal. The “outdated comps” all sold within 1 year and were located within 1 mile of the subject in the same competitive market and contained proper upwards adjustments for an increasing market. Oh, and did I mention that I have a very professional office manager? I have the calls between the individual and this client recorded so that I can help ensure quality control. Remember: Many internet reviews are faked. There are always two sides to a complaint and a praise. Always perform due diligence when deciding.
Okay, okay, I’ll wrap this one up. The point I’d like to stress with this publication is that internet reviews of the appraisal profession can be very misleading when selecting a potential consultant for your valuation needs. The valuation industry is a unique space for customer service. Unlike most service industry businesses, an appraisal and appraiser must follow the Uniform Standards of Professional Appraisal Practice (USPAP). In short, the appraiser must follow procedures in developing and reporting the appraisal from an unbiased view; thus, advocating for the appraisal and not necessarily for the client. DFW Appraisals is dedicated to providing the utmost procedural service to our customers; however, this does not always mean providing an analysis to “please” a client and never providing a predetermined analysis set for the client.