About a month ago, Barb Tores, ASA posted a very popular tongue-in-cheek article titled Real Estate Appraiser says: "Just say Noooooooo! In THIS article Patrick Egger, a Certified General Appraiser located in Las Vegas, NV., will take a look the other side of the issue:
The other day I read and interesting article by Edward Marshall titled, "How to transform a "Culture of No" into a "Culture of Yes." While Marshall's focus is on the many issues that exist in the corporate world, relative to new ideas and changing direction to meet tomorrow's challenges, his insights also apply to cottage industries, such as appraising.
The central theme of the article is exposed by the title. After reading the piece it made me step back and consider the appraisal profession and the issues we have addressed in the past and are certainly faced with now.
In reading posts on various appraisal related forums, it would appear that often we are quick to reject new ideas or thoughts rather than to find a way to embrace the idea, expand upon it and improve. The same applies when our appraisal reports come into question by others from outside the group, such as underwriters, reviewers, agents and the like.
Considering the turmoil on Wall Street and in the secondary market (the true intended user of most lender reports) is it not reasonable to expect on onslaught of requests for additional comparables (including listings and pending sales) as requested by Countrywide and Landsafe in a recent memo?
Is it even more apparent, given the state of the national housing market and considering the rapid decline of home prices in many market areas, that expanding the market comments area to provide the client with greater analysis on local housing market conditions would be necessary to produce a "creditable value opinion"? It would seem so to me.
When housing prices were on a rapid upswing, most of us were providing additional comparables, including pending sales to support our time adjustments. Many of us were also providing addenda (clips from news stories, local housing statistics, market reports, etc.) that detailed the velocity of the local market and chronicled the rapid price changes. We did so to support our logic then and we need to do the same to support our logic now.
Before we vent frustration with posts and comments on the "stupid underwriter request", we need to examine the reasons for the request, from the client's perspective.
If for some reason, we weren't as clear as we should have been or if we are placing remarks in areas that users/readers aren't finding the answers they need, perhaps our best "defense" is a more 'pro-active offense."
This is not to say that many posts or comments aren't justified, only to point out that if a reviewer, underwriter or client requests clarification of something we wrote, perhaps we should first take a look at our communication style within the URAR and see if we can improve.
Over the years I've questioned many comments (or lack thereof) of appraisers, including those I consider equals, those below and above my ability. I've had questions directed towards my work as well.
Fortunately, "my skin grew a little thicker" and I've learned to accept these questions as opportunities vs. personal challenges to my ability (and ego). By taking the time to consider the request (objectively) I've improved my communication with each report written and learned to be more pro-active with support for my conclusions, etc.
We can't control the volume of changes that will take place inside the mortgage industry over the coming months, especially in regards to additional underwriting requirements.
As lenders adjust to new standards, we also need to make a choice as well. As professionals, we can be a "culture of no" that maintains the status quo or a "culture of yes" that sees the challenges, makes the adjustments and takes the opportunity to improve and evolve.
If you were in the client's position, whom would you want to deal with in the future?
AUTHOR: Patrick Egger is a Certified General Appraiser located in Las Vegas, NV. He teaches continuing education classes on the housing market, appraisal issues for real estate agents and appraisers. He can be reached at [email protected]
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