Appraisal Scoop

Zaio and Me - The Business Model Examined

The author is the owner of Acorn Appraisal Associates, a 20 year old firm offering a wide range of quality appraisal services to the Financial and Business Communities in the greater Houston SMSA

The current year has witnessed a number of  new business ventures that offer opportunities to appraisers to expand their markets.  Zaio, Zillow, IRR come to mind.  I haven't attended any of the introduction seminars put on by these ventures, so I'm not privy to any insider information, not bound by any non disclosure agreements.  I've only visited the various web sites, and free from any facts, I'm able to speculate wildly.  Perfect!

I thought the Zaio business model the weakest of all I've yet seen. Especially if the appraiser is not the one taking the photos...I originally thought territories were purchased, the purchaser was responsible for the territory, taking the photos, labeling and uploading them, then loading all the sales in the market into the data base also...That's one huge undertaking.  Also, I felt there might be limited use of such data.

But when something thought through by wise guys doesn't make sense to me, it doesn't mean it isn't a good idea...it just means that I need to consider it a little more. I might agree, I might disagree, but I need to learn more... Click Below For More!

eo Tablet Bump Case Reviewed

The long awaited tabletkiosk eo bump case finally arrived yesterday!  I was anxiously anticipating its arrival because I felt this was the missing piece in being able to safely take the eo v7110 into the field for home inspections.

I was very pleased with the look and feel of the case.  It's a 'leather look" type material and has a very good gripability factor.  My eo slipped snuggly into the case that is basically two customize panels connected together by elastic material to form an "eo sandwich".  This open design provides for good access to all of the ports and controls.

I really like the fact that the top enclosure (two Velcro straps) easily accommodated the larger extended battery.  The standard battery would be fine if one were just going to do one or two inspections, but anything longer than that will require connection to a car charger or switching to the larger battery.

Flipping it over one finds large elastic straps that allow the user to slip their hand through.  I tried putting my hand through the straps from the side and from the bottom.  Ergonomics would suggest that coming in from the side would be best.  When I tried it from the bottom, I found I had to hold my wrist in a rather uncomfortable angle.

The tabletkiosk bump case for the v7110 comes with a nylon strap with plastic snap-on connectors that swivel.  Here's where things start to break down.  The strap is about the quality one would expect to come with a cheap give-a-way tote bag.

As you can see from the photo above, the extended battery in combination with the location of the connecting hooks, makes the eo top-heavy and hang at an angle.  But that's not the worse design flaw!  The hooks are at the top of the unit.

I handed the unit (with strap) to several appraisers and they all quickly made the same comment: "It's upside down when I try to use it?!"   Why?  The UMPC is hanging from the top and when we pick it up, it's not oriented correctly.   The bump cases that come with Motion tablets have hooks on both the top and bottom, allowing users a wide variety of configurations.

My solution was to run the shoulder straps under the elastic bands on the back and connect the hooks from the bottom.  This is a bit awkward looking but the unit will hang better, is properly oriented, and still sits on the stock easel for desktop use.

Overall I'd give the bump case a B - .  It's got a good look and feel.  It accommodates the extended battery.  All the controls are accessible.  The case actually provides a bit of insulation from the heat of the UMPC.   If they had given more attention to the quality and location of the strap and maybe some sort of display cover I could probably have given it an A!

The 12 days of Appraiser Christmas

By Paul Stansberry 

12 Past due invoices...

11 Quickdraw Distos...

10 Thorny Bushes...

9 Year-old Files...

8 Crazy Homeowners

7 Good Comps...

6 Re-take photos...

5 Neeewwww Rush Orders....

4 New trainees...

3 Drive-bys...

2 Underwriters...

And a dog chasing you up a tree...

ASB Gives Us An Early Christmas Present!

The ASB has given us their Christmas present early this year in the form of their December Q & A's.  This is probably the best Q & A of the year.  Click here.

Here are the topics covered:

• Conflicts of Interest
• Sample Appraisals and the Ethics Rule
• Responsibility for Workfile Retention
• Appraisal Management Company as Authorized Agent for a Client
• Subsequent User Requests a "Reliance Letter"
• Purchase Contract is not Provided to the Appraiser
• Update of an Appraisal Completed by Another Appraiser

Add the Real Estate Dictionary to your Website

The Real Estate License Professor in cooperation with Google is pleased to provide their Real Estate Dictionary application to webmasters who would like to add content to their website. The Real Estate Dictionary allows access to hundreds of Real Estate specific terms and definitions and it is completely free to add to a website. This is a fun tool for appraisers, brokers, sales agents and other real estate professionals. It can be customized to suit the look of your own site.

Add the Real Estate License Professor's Real Estate Dictionary to your website.

Licensing Initiative Aims to Slow Fraud

State banking and mortgage regulators are hoping an initiative to build a nationwide licensing system and database will help put a dig dent in mortgage fraud and force unethical loan officers out of the business. Lew Sichelman has the details.  Full Story: http://realtytimes.com/rtcpages/20061220_slowfraud.htm

New Homebuyers Hit By Falling House Prices

David Dunn felt as if Christmas were stolen from him when prices for neighboring homes in his new subdivision fell by about $140,000. Now, he says, his home is worth less than what he owes, making it next to impossible to refinance before his $3,000-a-month payment doubles. Eleven other neighbors who bought before the price cuts are in the same boat.  Click here for the complete article.

Bathroom remodel could hurt resale value

Replacing tub with shower a turnoff for families with young children - Tuesday, December 19, 2006 - Inman News Article

Q: I have a four-bedroom, two-and-a-half-bath home. I'm thinking of replacing a bathtub in one of the full baths with a full-sized, enclosed shower. If I do this, would my house now be considered as having less than two full baths? And, do you think this would have a negative impact on my home's resale value?

A: In terms of a future listing, I suppose, technically, that your house would now have one full bath, one 3/4 bath, and one half bath, but I think saying it that way would be complicated on a listing sheet. I'd just say 2 1/2 baths and either mention the new shower enclosure in the detail section of the listing sheet or let buyers find out for themselves.

It's hard to say whether replacing a bathtub with a shower would be a negative in the future. Fifty years ago, people were conditioned to having bathtubs in all bathrooms. Today, most adults take showers over baths because they take less time. Some seniors prefer showers to bathtubs because they're easier to get into.

And today's showers look nothing like shower stalls of old. Today's shower can be a steam room, with rain-like showerheads coming down from the ceiling instead of out from a wall, and high-pressure massage valves.

From my own experience, young families need at least one bath in a house so that they can bathe babies and young children. Having a fabulous shower might make your home worth more, with at least one of these kinds of bells and whistles, plus nice ceramic or granite tile should give your home's value a boost rather than detracting it.

But I can see that this might be different in other parts of the country. So, let's throw it open to everyone.

Readers: Do you think replacing a bathtub with a shower would increase or decrease the value of your house in your particular neighborhood? E-mail Ms. Glink at [email protected] and she will include your responses in a future Inman News column.

The Power of Intention

After getting off the phone with an appraiser in TN on Friday morning, and checking my emails, I noticed in the background that Dr. Wayne Dyer was on PBS with his Power of Intention program. I like Dr. Dyer, and have listened to many of his books on tape or CD. Part about what I love are his poignant stories. Stories about people doing the right thing. I just love good stories with a good moral.

After listening to him it dawned on me that I know if we can have the courage to embrace the concept of the Power of Intention, we will attract good things in our life, will end up creating good will.  Dr. Dyer taught me the difference between a Belief and a Knowing.

Starting an appraisal assignment with a predetermined value, whether it is $25,000 or $25,000,000; is averse to the Intent of the License Law and to USPAP.  It is not a good Intent. This is a bad habit that can result in misleading results.  It can also result in liabilities, criminal and civil. We cannot certify we are neutral and objective; when we start the assignment with a bias toward a predetermined value. Yet many in our field make a living doing just that.

For those who may be struggling with this issue, and absent any structural support for the appraiser who wants to be ethical and honest, I offer some things that might be helpful.

  What I found that helps me a lot is listening to Books on Tape, or CD's.  I have little time to read, except on vacation, and then I mostly paint. Being dyslexic, I find reading harder than listening. It is troublesome at times. Like trying to remember when to multiply or divide, order of operations, etc..

The Power of Intention is a good title, well covered. Some other things that are worth reading or listening to, based on my experience, include: Click below to read on . . .

Best Practices – Analysis of Sales Contracts and Listing Histories

  According to the Dec. 8 LSI Vantage Point newsletter by George Vann, SRA: "Many reviewers are noting an increase in the number of appraisers who omit the required analysis of the subject's purchase contract, sales history and listing history, resulting in appraisals that violate USPAP and Fannie Mae guidelines. The lending industry, in general, is also experiencing an increase in mortgage fraud and the fraudulent transactions often are facilitated by a faulty appraisal."

One area of concern in many of those appraisals has been lack of information and analysis in these key areas since omission of this data can sometimes hide bogus "flip" sales and inflated contract prices. Heightened awareness of the issue has caused secondary market investors to look more closely at these areas of an appraisal and to reject those that are weak in reporting and analysis. It is crucial that all appraisals prepared for LSI clients contain a full disclosure and analysis in these areas, per Fannie Mae and USPAP.

When appraising a property that is under contract, it is unacceptable to merely restate the contract price and date.

"Analysis" of the contract involves :

• reading the contract for unusual terms,
• concessions,
• allowances for repairs,
• included personal property,
• payment of special assessments,
• above-typical commission fees,
• and so on, and then analyzing their effect on market value.

If the contract refers to an addendum that was not sent to you with the contract, request the addendum. It may contain provisions that are important to recognize.

If the contract was not available for review, you must explain what efforts were made to obtain it. Only stating that it was "Not Available" is unacceptable.

For all appraisals, whether purchases or not:

• Report and analyze all prior transactions of the subject for the three-year period prior to the effective date of the appraisal and all prior sales of the comps for one year prior. Only reporting the date and price is unacceptable. 
• Include in the analysis comments about the relationship of the prior sale price to current value, such as general increases, declines or stability in area values, significant renovation to the property, etc. 
• Remember that these time periods of one year and three years are minimums; report and analyze any older prior sales if you believe them to be relevant. Multiple prior sales within a short period of time can indicate flipping activity and must be analyzed. If this type of activity is noted in a comparable sale, do not use it without confirming that the current sale is truly at arm's length. 
• Do not use comparable sales in which the buyer or seller is also the buyer or seller of the subject property.