Author: Woody Fincham - http://www.woodyfincham.com - Woody was one of the founders and the managing appraiser for FM & Associates. He has worked as a fee appraiser for 8 years for various firms, most recently with Braun & Associates in Maryville, TN. He is now an appraiser with the City of Newport News Real Estate Assessor, and performs private fee work with F&M Associates in Virginia Beach, VA. Woody is a Certified Residential Appraiser in Virginia and Tennessee. Woody is also a Member of the a la mode labs project
Should a designation be the goal of residential appraisers? If you ask several appraisers, you will get a bunch of different answers on this topic. When lurking over at appraisersforum.com, it can sometimes be comical how polarizing the topic of designations can be. Normally these conversations degrade into one side trying to out-insult the other. I wanted to summarize some information in one place regarding designations, and the benefits of earning a designation.
What Designations are Available?
Several organizations offer real property designations in the United States. The largest five are comprised of the Appraisal Institute (AI), the American Society of Appraisers (ASA), the American Society of Farm Managers and Rural Appraisers (ASFMRA), the National Association of Independent Fee Appraisers (NAIFA), and the Royal Institution of Chartered Surveyors (RICS). The AI has the most recognized designations in the USA: the SRA and MAI. The next three, ASA, ASFMRA, and NAIFA, are somewhat smaller organizations, but are all equally recognized within the industry. RICS is not as well known in the USA, it is originally from the United Kingdom.
All of the major five designations require specific classes, exams, real world experience and demonstration reports. Each designation earned shows that the appraiser has taken education that far exceeds the education of most licensed or certified appraisers. Many appraisers attend private schools that offer education that is typically less quality. The mentioned organizations have, arguably, the best appraisal education available in the United States. Designated appraisers also agree to be held to the standards, that they hold membership in, respectively. These standards are beyond the normal standards set forth by USPAP. A designation can be removed by the respective organizations if the member is found to not meet the standards, whether from maintaining CE to conduct unbecoming in practice.
Below is a chart that shows the essential differences between the SRA designation requirements, and a typical certified residential appraiser. I am using the SRA for the comparison, because it is the one that I am most familiar with. The other organizations have similar paths to designation.
Looking at the requirements one notices the small difference in classroom hours, the demonstration report, the continuing education and the experience hours. While it is possible for a non-designated appraiser to have taken all of their education from one of the five organizations, the biggest difference rests with the demonstration report and the continuing education. The demonstration report or acceptable alternative allows the appraiser to show case his or her ability to research and report value utilizing the proper techniques and procedures that are contemporary at that time. Once again, the continuing education must be from a quality provider, most often the organization that the designation was earned from.
What is the Big Debate Amongst Appraisers?
As I mentioned earlier, appraisers in general have a mixed response as to whether designations are beneficial or not. Depending on whom you ask, you may get a flowery reply, or you may get a very cynical reply. Asking a designated member about the benefits of earning a designation will usually result in a very positive response. If you were to ask a seasoned non-designated appraiser (meaning an appraiser who has been active for more than 10 years), the answers are normally very scattered, but are often backed up with strong opinions either way.
I have had the pleasure of being able to attend various industry functions all over the country. In doing so I have met numerous appraisers, and this topic often arises. I have been surprised more than once by the replies that I get.
Here are some of the negative things that I hear:
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