Friday, December 27, 2013

Appraiser's in Hardin County and Their Technology

Technology for the Appraiser

Technology has changed so many aspects of our societies.  Electricity, automobiles, planes, microwaves, atomic energy, computers, the internet, and cell phones are just the beginning of a long list of technological changes that have shaped the world we live in.  The appraisal industry is no exception.  Appraisers used to take inspection photos with 35mm cameras, have the film developed, hand type the report, glue or tape the actual photos to the report, and either mail or hand deliver the report to the client.  That was bad enough, but keep in mind MLSs (Multiple Listing Service) did not exist and tasks around the office were done manually (i.e.-accounting).  How did appraisers ever get anything done?   There are many types of technology that appraisers can use in order to save time and money.  We’ll be covering a few of them in this chapter.

Internet and Software

I will not be spending much time on the Internet.  Let’s just say that it is a vital tool used to source information and deliver our products.  We use the internet to access our MLSs, online data sources like PVA, and delivering our appraisals through portals such as Appraisalport

Software programs can be put into two categories: production, and management.  We’ll talk about production first.  The main program that you will use for producing reports will be your appraisal form-filling software.  This program is offered by many companies, none of which I’ll endorse over the other.  You may want to check out: Bradford Software’sClickforms/CompCruncher, A La Mode’s Total 2013, ACI’s Appraiser Choice, and Homeputer’s software to name a few.  Some of these programs have built in sketchers, databases, forms libraries, mobile and accounting technology that range from $99 to over $600 depending on your needs.  My advice is to make a list of your requirements, collect information about the programs, and then go shopping. 

Your management software is primarily used around the office.  Microsoft’s Office products consist of familiar programs like: Word, Excel, PowerPoint, and Publisher to name a few.  These programs can be used for a host of tasks that relate to marketing, advertising, writing letters, organizing data, etc.  Intuit makes a popular accounting software program called Quickbooks.  This program is compatible with certain appraisal software programs, and it can also be used to pay employees. 

Field Technology

In recent years, several gadgets have been made available that speed up our ability to gather field data and enter it into our appraisal programs.  Laser tape measurers (such as the Disto) are a convenient tool that allows you to get rid of fiberglass and metal tape measurers.  Lasers come in a variety of ranges, and some of them have built-in Bluetooth technology that allows them to communicate directly with a tablet device.  Lasers have both advantages and disadvantages; they dramatically reduce the time it takes to measure a home, they have the ability to make simple calculations, and they require only one person to measure a home.  On the flipside, you have to keep a spare battery on hand, and a pair of laser glasses in order to see the red dot in bright sunlight.  Lastly, in order for the laser to get a reading it needs a clear line of sight to a target. You can use downspouts, windowsills, water faucets, meter bases, and vinyl outside corners for most of your targets.  If all else fails, propping up a clipboard or tablet will make a nice target.

In addition to lasers, tablets are making their way into the appraiser’s tool chest.  At the present, I’m aware of two apps that can be used on Android tablets and iPads for collecting field data: Phoenix Mobile, and Total.  These applications allow the user to start a report at the office, edit the report while in the field, and sync this data into the report at the office so it doesn’t have to be entered a second time.  This process has the ability to save quite a bit of time and eliminate some of the paper trail.  A tablet can also be used as your camera, therefore eliminating the need to carry multiple dedicated gadgets; it also has the ability to geo-code the photos if that feature is important to your practice. 

The last piece of field technology I’ll go over is the GPS (Global Positioning System).  Instead of printing out directions and trying to read them while driving, the GPS will usually guide you pretty close to where you want to go.  You may even be able to use a tablet for this, thereby eliminating another dedicated gadget.  By the way, GPSs are not infallible.  They have led me to cattle gates, down one-way streets (the wrong way), and down roads that no longer exist, and some of their mapping is several years behind the current road system.  Just me mindful of where you are in case the GPS has a hiccup. 

Computers, Backup Systems, and Security

Choosing a computer is like buying a car or phone.  There are a myriad of choices and configurations, and personal taste has much to with the type of machine you choose.  The only point I’ll bring up is that most appraisal programs are currently Windows based.  If you are a die-hard Mac person, you’ll have to run boot camp (partitioning program within Mac) in order to install a Windows OS so you can run your programs. 

USPAP requires us to maintain our work files for at least five years, or two years past the last litigated event.  This leads to huge filing cabinets, boxes, and rooms filled with old reports, which are vulnerable to damage or theft.  This leads to back up systems.  Work files can be stored electronically (i.e. - on external hard drives or remote back up stations) which eliminates quite a bit of the paper trail, and provides reasonable security.  External hard drives can be bought at very reasonable prices (I use WD software, which continually backs up my computer as I’m modifying files), and web or cloud-based back up services (Carbonite, Highrise, etc.)  can be purchased on a subscription basis. 

Lastly, I’ll touch briefly on security.  If your computer and its systems are becoming an increasingly vital part of your business, you need to stay on top of its security.  Always use an Anti-Virus software program (Defender, Microsoft Essentials, McAfee to name a few) in conjunction with a firewall, and keep them updated!  Protect your usernames and passwords, because if they are compromised the confidentiality of your client’s information could be at risk.  Next, make sure you are backing up your computer on a regular basis to either your external hard drive or off site back up service.  In the event of a bad patch update or your computer crashing, your information will be able to be retrieved and restored onto your machine. 


Well, this wraps up an introduction to the appraisal industry.  I have enjoyed writing these chapters, and they have made me think about my own practice.  We have covered everything from getting an understanding to the appraisal industry, through ownership, to skills and technology needed to operate a successful and professional appraisal practice. 

What have you all learned from this series?  What did you think I missed or should have elaborated on?  Is there a skill or technology that you think I should have mentioned?  Feel free to provide some feedback, and don’t forget to like us on Facebook and leave a review

Tuesday, December 24, 2013

Radcliff Appraiser and Business Skills

On Your Own
In the previous chapter, we discussed the options that are open to appraisers once they have their certification.  Have you decided to work for an appraisal firm?  Well keep reading because there are aspects of ownership that can benefit an employee or subcontractor as well.  In this article, we will be talking primarily to those who choose the route of business ownership. 

Business Owner Skills
You never know when you will be learning the skills that are used as a business owner.  Some of you may learn best by taking specific classes that are geared towards managing a business.  Others may learn by observing the styles and techniques that our employers use and saying to ourselves,” that works, or that doesn’t work”.  I guess there could also be those who may have a mentor or coach that guides them along their way.  Whichever way you learn, there are certain hard and soft skills that you will need in order to be a professional business owner. 

Let’s start with the office.  Whether you are working out of your house or at a dedicated office space, you will need to have at least a basic understanding of the following areas: time management, organization, customer relations, accounting, accountability, marketing, technology (which we’ll cover in a later chapter), and goal setting to name just a few.  I won’t be going into depth on these topics; instead I’ll be discussing each one as to why they are important.

Time Management/Organization- As a professional, your business must be structured in order to effectively use the time that you have available both at and away from work.  Some of our customers demand a very tight time table, and we need to be able to deliver and project our production with a degree of accuracy.  I hope by this point that you are comfortable with keeping a calendar for your appointments, but you also must balance the time that is needed for the other aspects of the business, such as accounting, marketing, meetings, etc.  To be able to do this requires the ability to multi-task, but don’t get too many irons in the fire that will cause you to be scattered to the wind.  In order to work efficiently, you must be organized.  Keep your files, databases, calendar, backups, and procedures up to date, because you never know when you are going to need to quickly access a piece of information.  Another aspect of organization is how is your business model organized?  What are your products? Who are your customers? What is your revenue model?  What is your competitive advantage?  What is your supply/service chain?  All of these areas need to be considered.

Customer Relations- As a business owner, you not only have customers in the form of your clients, but you are now a customer!  You will be a customer to the subscriptions, software, and other businesses that keep your business running.  Let me give a little advice here.  Be pleasant, courteous, respectful, mindful of other’s time, thoughtful of what you say (saying or typing the first thing that comes to mind can get you into trouble), and professional when dealing with or as a customer. 

Accounting/Accountability- Some of you may decide to outsource this service to an accountant, do it in-house, or a combination of both.  Either way will require a basic understanding of accounting in order to answer questions from your accountant, or make financial decisions.  Accountability comes into play when we are expected to maintain the confidentiality of personal and private information of our clients.  It also comes into play if you will be handling escrow funds or retainers.  Lastly, by being accountable to partners and employees, it produces confidence in your leadership ability. 

Marketing- If your marketspace and or marketplace does not know you are there, how will you get business?  Take time to develop, implement, and adjust a marketing plan.  When I started out, I read a book called Guerilla Marketing by Jay Conrad Levinson.  Jay’s book is great for businesses that are getting started and or those on limited funds.  Also take the time to do some research into Ecommerce.  This is a multi-billion dollar industry that could have an effect on how you market.  Try to be marketing on a regular basis, because you never know when you will need to increase or decrease your customer base.  While we are on the subject of customer bases, a diverse customer base (needing multiple services) that is spread out over different markets should produce a more stable income when compared to a focused customer base in one area.    

Goal Setting- You’ve got your plan, and you are working your plan, but how do you know if or when it needs to be adjusted?  This is where goal setting comes in.  This is one of those subjects that some people just love or hate.  Goal setting can be broken down into three main areas: short (1 to 6 months), intermediate (6 months to 2 years), and long-term (2 to 10 years).  Each area should have sub-areas that consist of every aspect of your business (revenue, customers, accounting, marketing, technology, expansion, etc.), and the sub-goals should be well-defined, attainable, and have a time frame.  Goals should also be evaluated on a regular basis which is where the adjusting process comes in.  The evaluation of a goal may reveal that a previous course of action is not working, therefore necessitating a change in your plan. 

Conclusion- Well, we are almost there.  Our next installment will be our final chapter which will cover technology in the appraisal industry.  If you have enjoyed this article, feel free to visit our Facebook page, press the like button and leave a review.  Reviews can also be made on this website under the review tab. 

Wednesday, December 11, 2013

Appraisers, Computers, and Radcliff, KY

I thought I would break the usual routine of appraisal topics that are focused in and around Radcliff, Elizabethtown, and
Hardin County in general by sharing with you all how I spent my evening.

How does the saying go? You learn faster by teaching?  Well, I wasn't teaching, but I was helping a group of fellow students (me included) get ready for an up and coming computer proficiency exam at McKendree University here in Radcliff.  I'm not as nervous as I used to be when speaking in front of folks, and the more familiar I am with a topic the easier it is.  Tonight was a middle of the road night.

I learned a lot from prepping for tonight, since I had to make up the study guide from scratch.  We still have a long way to go, but at least we are on our way.

Thursday, November 21, 2013

Hardin County Appraisal Certification

Certified- On Your Way!

Welcome back to the series about the appraisal industry.  In previous chapters we have covered topics surrounding the industry, getting started, education, and what takes place your first couple years in the field.  Today we will be discussing the topic of what happens once you have completed your work experience, education, and certification exam.  At this point, your value in the industry has just gone up because of your new level of certification.  Did you know that most financial institutes will only work with certified appraisers?  This could lead to a new source of income, but what about the company that you have been working with for the past couple years?  Until now you have been working under a supervisor, but is that what your future holds?  There are a few choices you have because of your certification. 


One of your options is to stay where you are.  Depending on your initial contract, you may have seen a steady increase in your pay split, but may appraiser do not think far enough ahead to spell out what will happen once you are certified.  Staying put has a few advantages.  One is that you do not have to start from scratch.  Building a business can be a daunting task, and it is not for the faint of heart.  Another is that a multi-appraiser firm has the ability to pool more customers and perform internal quality control.  The third advantage is that you do not have to foot bill.  Most supervisors provide some level of resources for you to do your job (ie- PVA subscriptions and MLS ).  Lastly, you may have the opportunity to be more productive; if you are part of firm that has its own office staff, you won’t have to worry about billing, collections, and the daily operations of running an office. 


Another option is to start your own company.  This can happen two ways; you may be forced to leave once you have your certification, or you could leave under your own terms.  As I stated before, make sure you spell out in your contract what will happen at this point.  If you have decided you want to be out on your own, make sure you are planning before you get your certification.  If not, you will face a very steep learning curve compounded by the lack of income.  My advice is to be open with your supervisor and do not take advantage of the resources he has given you to work for him. 

There are several advantages to owning your own company.  The first is you keep all the income. Depending on where your split is at, you could see as much as a 50% increase in income.   The next advantage is that you are in control of which customers you work for and you decide where you will operate.  It is very liberating to be in a position to fire a client that is a pain in the neck.  Once you have all the low paying, demanding, incompetent clients weeded out, you can start to enjoy what you do.  Through this process, I had developed several wonderful customers that I truly enjoy working for.  Before we move on, I want to mention that there is a lot that goes on as a business owner.  We will be covering this in-depth later on. 

Training & Credentials

More training, really?  Get used to it, as a professional you will be spending the rest of your life learning.  Certification is the start of many options to specialize in the appraisal industry.  Credentials are the alphabet soup that comes after someone’s name, and it indicates that the individual has specialized in some area.  To find out more specifics on individual credentials, I would recommend you visit the Appraisal Institute’s website (as a starting place) and see what the qualifications are for the different fields.  Does agriculture interest you? How about finance?  Maybe commercial properties?  What about litigation?  These are all different areas of expertise within the industry and some of these areas have specific credentials that go with the territory. 

In closing, certification is an important step in your appraisal practice. It is the fork in the road for many appraisers.  They choose to work for themselves or the work for a company.  Lastly, continue your training.  Not only are you required to take at least 14 hours of continuing education each year, but you will become a better appraiser because of it.  

Wednesday, November 13, 2013

Updated Google+ Page

Just a quick note to the subscribers out there.  I've had to delete my old Google + page due to the addition of Google Places.  Here is our updated page cover.

Wednesday, October 30, 2013

Associate Appraiser- Now the Work Begins!

Work Experience:

Now that you have gotten your certification, you are almost ready to head out into the field. But first, I want to reiterate the necessity to make sure you have a clear set of expectations from your supervisors and visa-versa. Over the next several years, you will be appraising a variety of properties such as: land only, interior residential, exterior residential, condos, small income producing properties 1-4 units, and reviews to name just a few. Be sure to keep track of your work experience, you will need to submit periodic samples to your appraiser board for review.

No matter what you are appraising, when you boil the assignment down to the basics, you will be identifying the problem, analyzing the data, reporting your results, and answering the initial problem. Everything up to filling in the form will cover the first two steps. Let’s get started.

Learning the Ropes:

Congrats, your first appraisal request has come in! I’m sure you have done the preliminary steps of identifying the user/client (which is not always the same person or company), intended use of the appraisal, and scope of work which is all a part of identifying the problem. This is an important step, because the amount of analyzing and reporting depends on the type of problem. Depending on the type of request, you may be contacting home owners, executors, Realtors, or lawyers for setting up the appointment time. Try to mention to home owners and Realtors that you will be inspecting the attic, crawl space, and will need the utilities on for certain types of reports; sometimes these areas are blocked or utilities may be off which hampers the report or could cause you to have to come back.

Before going to the inspection and if time permits, try doing some background work. Pulling PVA cards, County Clerk documents, real estate tax information from the Sherriff department, Planning & Zoning classification, aerial photos, and MLS data will give you an idea of what you are getting yourself into and is all part of analyzing the data. I’ll even start pulling potential sales and listings that may be used as comps if enough data is available on the subject. The bulk of your time in developing an appraisal will be spent in this phase.

On the way to the inspection, try to arrive early enough to get a feel for the neighborhood. Take this time to look for factors that may be contributing or detracting from the subject property. Drive around the subdivision or area and look for repos, commercial/industrial facilities, high tension power lines, golf courses, railroad tracks, etc. Anything that may raise a red flag would probably need to be disclosed in the report. If you have pulled potential sales and listings during your background work, take this time to drive by them to verify the MLS data and get a feel for their neighborhood. I do this on a regular basis, and from time to time, I will find a sale that I have pulled for consideration does not compete with the subject for whatever reason; drop the sale and find another! A second trip to verify another sale won’t hurt.

Do yourself a favor; show up on time to your appointment. I rather make a call asking to show up a little early then calling to tell the home owner I’m going to be late. I usually dress sharp casual (polo shirt, slacks or jeans, a cap to hold my pen, and water-resistant footwear) for two reasons: I am a professional, and I do plan on getting a little dirty. Once you are at your appointment, the interior inspection can be tailored to whatever is comfortable to you. I always start out by sitting down with the home owner and chatting with him or her for a couple minutes. This accomplishes a few things. First, I give them a brief run-down of the appraisal process because some people have not been through an appraisal before, and I want them to have a good experience. Second, I get them talking about what they have done to the property in recent years. This helps me in determining the condition and effective age of the home. I won’t be discussing how I determine the condition or effective age of a home in this article; I’ll leave that to your supervisor.

After I am done talking to the owner, I inspect the home the same way each time for consistency sake. I take notes, measurements, pictures, look for deferred maintenance, safety hazards, and updates as I am going throughout the home. I’ll do this on each floor of the home (including the attic and crawl space) before I go outside. Once I am outside the home I do the same thing: notes, measurements, pictures, location of wells and septic tanks, etc. Before I leave, I make sure I have all the data I need, and I thank the home owner for their time. I’ll let them know what to expect from here on out, and I give them a card. I started doing this when I kept hearing that some (not all) loan officers were not telling their customers the next step in the process.

Are you ready to start throwing the report together? Not yet. After the inspection you need to finish the analysis phase of the appraisal by analyzing anything that may have come up during the inspection. I’ll give you a good example. Let’s say that while you were driving around the neighborhood, you noticed a set of high-tension power lines behind the subject’s street. This may or may not affect the value of the property, but it is your job to find out. I would start out by searching for sales along the lines to see if there were any signs of depreciation, and follow up by disclosing your results in the report. Once the analysis phase is complete, it is time to compile the report.

Since this article covers mainly residential appraising, I’ll stick to the most common form of reporting, which is form filling. During this phase, we are taking the data that we have analyzed and disclosing it in the report in a way that makes sense to the reader. The recent requirement of UAD (universal appraiser dataset) does not help in this due to the jargon that is required in the report. Nevertheless, all the requirements of reporting under standard 2 of USPAP need to be covered in the report. For the most part this is easy, just plug in the data that the field is asking for and work your way down the report. It’s during this time that comparable (comp) sales and listing are selected from your pool of data. This is another area where your supervisor can assist you, but I’ll give you a couple of tid-bits: you are looking for the closest, most recent, most similar sales and listings for your report; explain, explain, explain; and disclose, disclose, disclose. Once you start selecting your comps, you may have to slip back into the analysis phase in order to develop adjustments. Remember, look for verifiable sources for your adjustments, and don’t pull them out of the air!

Once you have completed the report, if possible, have someone else look it over. Having another set of eyes usually will pick up errors or something that needs to be tightened up on. The forms we fill out make the last phase of the process easy: answering the problem. This is done when we place a value on the property, but you should still take the time to explain how you arrived at that number. In other assignments, the final phase may need to answer a different question, because not all definitions of value are the same or the initial problem may be a portion of the value. After the report has been signed, completed, and delivered, you need to follow your office procedures on how to handle the work file and billing. Simply putting your work file on a stack in the corner of the office and hoping the client will cut you a check is not how a professional operates.

Mind what you have learned:

After the first report you may say to yourself, “this took forever, how am I ever going to make any money?” Be patient, as time goes on you will begin to develop your own routine and begin to anticipate the types of problems that arise in the appraisal process. The reports will get easier, but remember the words of Master Yoda, “mind what you have learned, save you it can.”


Monday, July 22, 2013

Specialized Training - Part 3

Life of Learning

In the previous chapter, we covered the introductory education process.  The process can take a couple of weeks to several years depending on how hard you hit your education, but the process does not stop there.  We have already discussed that certified residential appraisers are required to have a minimum of 200 hours of approved appraisal education, but general certified appraisers are required to have 300 hours. 

Each year, appraisers are required to take a minimum of fourteen hours of continuing education (CE).  Continuing education can consist of re-taking classes you have already had, or they can be classes for advancing your certification (i.e. - residential to general certification).    When you ask someone who you consider to be a professional, “How much training do you do?” and they answer you by saying, “Oh, I just do the minimum” this does not inspire confidence.  True professionals make learning a life-long goal.

A professional appraiser will benefit from more than just appraisal education.  As I think about my daily routine, I interact with people and financial institutions, perform general business duties, draw on my appraisal knowledge, deal with the legal system, and use a wide array of computer skills.  When you think about it, that covers the human resources, legal, finance, real-estate, information technology, and business management fields.  That is a lot of learning you can pack into a life time, not including the type of education you receive from on-the-job training and learning from your mistakes and the mistakes of others.  We will be covering some of the specific skills needed in the business environment in a later chapter.

As a part of your appraisal education, you will have the opportunity to pursue credentials from institutions that promote best practices and above-average education.  Credentials allow other people to perceive that you are not just an average appraiser, that you take your profession seriously, and that you go above and beyond the minimum standards.  Some of the credentials you may be interested in are: MAI, SRA, SRPA, and ASA to name just a few.  Credentials require meeting their individual requirements for education, experience, and some kind of a fee.  Speaking of fees, study the requirements, benefits, and do not waste your money!  A good friend of mine recently told me that he allowed several of his credentials to expire because they were not worth funding each year.  Keep in mind that some credentials cover very specific fields within the appraisal industry.  Some of these disciplines include business, agriculture, economics, and investing. 

Independent, Impartial, Objective

Lastly, I want to cover one of the most critical soft-skills that you will need to develop early or it can get you into a lot of trouble: the ability to remain independent, impartial, and objective (IIO).  Remaining IIO is a USPAP requirement, and it is one of the foundations to our industry.  Why is it so important?  I am glad you asked.

When we are engaged by our clients to render an opinion of value on a piece of property, it is because they need an educated opinion to aid them in making a decision: to lend or not to lend.  If we allow ourselves to be influenced and favor a particular side of a transaction, then we have not fulfilled our duty to our client to give them information that allows them to make a sound decision.  We have ceased to be objective, and we are now advocates.  Advocacy has its part in the industry, but not when we are asked to render an opinion of value in a financial transaction.  Let me explain it in a real world situation.

John and Jane have repeatedly taken equity out of their home through refinancing.  Now the market has turned and their bank account is getting tight.  So they try to refinance their home again through a local mortgage company that will send the loan to the secondary market, which is where you are called in.  While inspecting the property John and Jane mention several times that the property has been recently appraised for $xxx,xxx, and they just have to have it appraised for more than that.  After doing your market research, you discover that John and Jane’s subdivision has noticeable depreciation over the past several years.  So here is your dilemma, you can make the home-owners and the mortgage company happy by cherry-picking sales and allowing the lender to loan money on a property that has an inflated value, or you can fulfill your obligation to your client and call it like it is.

Remaining IIO will result in tough decisions, nasty calls, and occasionally losing clients, but it is the right thing to do.   Here are a few ways to remain IIO: do not get emotionally involved in the transaction, do a thorough market analysis, and ask yourself at the end of the appraisal, “Do I believe this opinion of value?” 

Thanks for reading.  Stay tuned for the next installment where we will discuss what to expect once you get your certification.  


Monday, July 8, 2013

Appraising The Situation - Part 2



So the appraisal industry sounds like something you would like to get more information on, where do you go now? Well, the first place is start talking to appraisers who able to take on apprentices.

 The supervisor’s job is to continue your training once you have completed your entry-level training and exam. They will be with you on your first inspections, guide you through the valuation process, help you complete your reports, and hopefully teach you how to be a professional in the field and in the office.

You should interview several appraisers in areas in which you will consider working. The interview process will be educational in and of itself because it will expose you to a variety of office policies and supervisor styles. Be sure to ask about goals; employment contracts; who pays for resources, errors & omission (E&O) insurance, highs and lows of the work cycle; equipment; weekly meetings; if your work is provided by the supervisor or if you must come up with your own work; coverage area; access to work files; pay; and how termination will be handled. I must warn you at this point, that finding a supervisor may be harder than it sounds.

I have heard several appraisers say, “Why would I want to train my future competition?” which is a valid point. Many appraisers get comfortable working in a specific area and have a small customer base. The amount of work that these appraisers typically get would be diminished if a new appraiser suddenly shows up in their market. My suggestion to this situation is simple: don’t seriously talk to these about a supervisor role.

Instead, look for an active appraiser that is fixing to retire. There are two advantages to this. First, they are more willing to pass along what they have learned to a trainee. Second, they have a huge amount of experience in which you can learn from.


So you have talked to a couple appraisers, some may have been open to your proposal, some may have said, “Come back after you have your license and then we’ll talk.” You have now come to a point in the road where you will have to invest in your future. Most supervisors will ask you to pay for your own training, but they might point you to an education provider. I won’t be suggesting education providers here, but keep in mind that most states have some type of core class that you can take in a matter of a few weeks. The alternative is to take the classes over a long period of time.

These classes will introduce you to the basis of the appraisal industry. Some of the topics that are covered are the origin of property rights, types of valuation methods, finance, technical writing, and much more. Once you have completed your entry-level training and passed the associate level exam, you are now ready to get into the field with your supervisor. According to the Appraisal Qualifications Board (AQB), a residential trainee must have 200 hours of appraisal education, and 2500 hours of related work experience under a supervisor(s) before you take your certification exam. Your entry-level exam from your education provider, the associate level, and the certification level are the three exams you will have to take to become a full-fledged appraiser.


Monday, June 10, 2013

What Appraisers in Hardin County Do

1.What Do Appraisers Do?


When I decided to become an appraiser, I had little knowledge of the industry.  My wife and I had decided that I would change professions because of the needs of our family, but the process of becoming a professional appraiser and understanding the industry has a steep learning curve.

For the past several years, I have noticed several trends as I attend training, seminars, or just during the normal course of business which include: the aging appraiser community, and the dwindling numbers of appraisers.  Why is this?  I’m glad you asked.

Forget Webster’s Dictionary for a definition of a professional, it does not reflect what a professional truly is.  Educated, expert, highly-trained, well-paid, business-like, and other thoughts may come to mind when someone asks you what the qualities of a professional are.  Appraisers are no different. 

The Industry

Appraising is a multi-billion dollar business.  Although appraisers operate in several industries, I’ll be focusing on the most common, which is the residential real property appraiser.  According to the Uniform Standards of Professional Appraisal Practice (USPAP), an appraiser is: one who is expected to perform valuation services competently and in a manner that is independent, impartial, and objective.  Appraisers are governed by a set of standards known as USPAP, in addition to state and federal law, lending institution guidelines, and client requirements. 

Appraisers always start out working for a company as an apprentice.  Later in their career, they may branch out on their own and work by themselves, or start their own employee based company; at which point, they wear several hats like: accountant, marketer, customer service rep, computer-support tech, trainer, and appraiser.  Owning a successful business is very fulfilling, and it is something I have wanted to do since I was a kid.  I’ll get into the nuts and bolts of the business side in a later chapter. 

What We Provide

We provide technical information concerning value of property, rights, and interest to our clients in the form of written or oral reports.  We also provide different types of valuation services that utilize our skills without actually creating an appraisal.  Some of those services are: consulting, professional analysis, testimony, and litigation.  These types of service require specialized training and ethical conduct of a true professional.  

Sounds like a worthy profession doesn't it?  Well, stay tuned for the next chapter on getting started.


Friday, April 5, 2013

Meade County Update


While I was searching for topics for a new blog, I realized that I have not done a market update for Meade County in quite a while.  So for all y’all that live in and around the Brandenburg area, this one is for you.

Let me start by briefly explaining the demographics of Meade County before I get into the details.  Meade County is located in the central part of Kentucky along the Ohio River.  Approximately 30,000 folks call Meade County home, and is mostly rural.  The county seat is Brandenburg, and the largest subdivision is Doe Valley which is a gated golf course/lake community. 

For the past several years, property values have been unstable, but rising over the long term.  In 2009, the median sale price of all sales in the county was $139,900, and in 2012 we saw the median sale price top $144,000.  But 2010 and 2011 were different stories.  In 2010, we saw a large influx of families due to BRAC, and properties values responded by rising to $154,000.  Then in 2011 the pendulum swung the other way by the median sale price dropping to 2009 levels. 

Although I usually put more weight on the long term trend of a neighborhood, I have been watching what has been going on in the past four quarters in Meade County.  Recently there are several indicators that of themselves might not indicate a change, but combined with each other they requires attention.  I’ve noticed that housing supply has been increasing, median sale and listing price has been dropping, and list-to-sale price ratio has been declining.  So what does all this mean?

Based off the unstable nature of property values in recent years, this seems to be the ongoing trend for the county.  It sounds like two steps forward and one step back.  The only word of caution I’ll throw out there is: sequestration.  Due to the recent government cutbacks, and the history of the past year, this may be hitting at a bad time because of the large amount of families that work on Ft. Knox in the area.  Only time will tell if this will have a negative impact on property values.

I’ll leave you all on a good note.  During the recent depression, Meade County has remained stable when compared to counties with larger populations.  Except 2010, Meade County has steadily increased in value since 2009.  Not only that, but one of the largest factories in the county, formerly known as Arch Chemical, has been revived by new investors that are determined to update the plant and  increase its profitability.  Thanks for reading, and I hope this has helped in some way.  Feel free to visit our Facebook page and leave a comment, and don’t forget to hit like before you leave.  

Wednesday, January 30, 2013

A Change of Scenery

Usually this blog contains content surrounding the appraising and real estate industries.  But every once in a while I pick a new topic, this time it's drag racing.

I went to my first national event at Maple Grove, PA (The Grove) when I was 10.  I knew nothing of drag racing except that it was LOUD!  That first visit to the hollowed 1/4 mile nestled in the hills of Eastern Pennsylvania would be a seed that would sprout into a life-long dream.

Drag racing is fascinating for several reasons, but the sound and smell is what keeps me hooked.  Unlike any other Motorsports event, the smell of burning tires and racing fuel will leave its mark on me for several days after the event.  The second most fascinating aspect of the sport is the technical side.  How do you propel a car safely from 0 to 320 mph in less than a quarter mile?  How do you harness 6000 plus horsepower, nitro-breathing motors that defy the original intent for which they were created?  How do you consistently run a motor above 100% volumetric efficiency and be able to predict its performance within .01 of a second?
One little known facts of drag racing that is the amount of diversity in it's ranks.  Boys, girls, men, women, and folks from several nationalities all compete at various levels of competition.  But the top ranks are not exclusive only to men.  Women have been winning at the NHRA's top levels since the 70s, and recently Top Fuel has seen it's first African-American champion: Antron Brown.  Check out this article from SPEED recapping last season.

I try to get out to the drag strip at least once a year, and usually I take the kids in recent years.  My kids thought it was hilarious that a front wheel drive Geo Metro was beating up the Bracket 2 field the last time we were at Ohio Valley in West Point, KY.  I'm looking forward to the day that I get to take the family to a National event.  My last trip to a National event was the finals at Pomona in 2007.  I was only there for part of qualifying on Friday, but it reminded me of the raw power of the sport.  Standing beside the track for the sportsman categories is nice, but when the fuel cars get the green light, you can feel the shock wave pass through your body.  It makes your eyes vibrate in their sockets, the inside of your nose tickles from the nitro in the air, and you can feel the hair stand up on the back of your legs under your socks.

In closing, drag racing is my favorite sport, but I'm not obsessed with it.  I work it in when I can, and when my driver doesn't win it doesn't ruin my day.  If you are wanting to try a new sport and you like Motorsports, head out to the nearest sanctioned drag strip and see if it's for you.  Walk around the pits, talk to the drivers, and have a good time, you won't be disappointed.


Appraising in Hardin County

As I've appraised properties in the Hardin County area over the past year, I noticed the amount of inventory slowly start to drop.  But here recently I've seen isolated areas that are back up over 12 months of inventory, and some areas are as high as 32 months!

Local property values favor low inventory, which is a simple demonstration of supply and demand.  However, when the supply of homes in the Hardin County area start creeping over 12-16 months, I start to notice more depreciation and a higher amount of homes that are over-priced.

Here is a market condition report for the Elizabethtown area for the past year.  This report demonstrates the relationship of supply and demand compared to property values.  Check out the trend of both the inventory and median sale price rows; as inventory goes up, price goes down.

Well, hope this helps.  Feel free to visit our Google+ and Facebook page , click the like button, and don't forget to leave a review!

Saturday, January 19, 2013

Bluegrass Valuation Services causing problems???

I'm trying to remember the last article I read in national headlines that sang the praises of appraisers, that's right, I haven't!  I just read another article from Fox Business that describes appraisers as backwards thinkers when it comes to home values.  This statement is partially true since the only place to find evidence of what the market is willing to pay for a piece of property is in the past.  However, this thought process is a two-edged sword.

Realtors are on the opposite end of the spectrum.  Most Realtors I've dealt with will list a home based off the active listings in the neighborhood, or worse, what the home owner owes on it.  This is especially dangerous when the home owner has lost his mind and borrowed all the equity out of his property just as the market starts to soften.

Appraisers select opinions of value in three ways: retrospective, As-Is, and forcasted into the future.  Of the three, retrospective and forcasted see the least action.  That's because lenders want to know what the property is worth the day of inspection, not in the future.  The best way to do this is to analyze properties that have sold according to the definition of market value ( I won't bore you with the details).

Why don't appraisers make adjustments on comparable sales for the time that has elapsed between the sale date and inspection date?  They typically don't due to lending requirements becoming increasingly tighter (most lenders want properties that have sold between 90 days and 1 year).  This short period of time isn't long enough for most markets to develop a noticeable trend which would dictate a time adjustment.  Only volatile markets that have clear trends typically will get adjusted.

So, what have we learned?  Well, if you want to know what a property is worth, you need to find properties that meet the definition of market value, which are in the past.  Lastly, appraisers do have the ability to look into the past as well as the future in terms of finding an opinion of value.  Feel free to visit our Facebook page , click the like button, and don't forget to leave a review!

Sunday, January 13, 2013

Appraisers in Hardin County KY are no strangers to appreciation

Wow, when I first read this article I was surprised.  After Hurricane Katrina, I didn't hear these types of stories, but I've got to wonder if this is wishful thinking since the country is still trying to recover from the recent depression?


Saturday, January 12, 2013

Appraiser Habits?

Now that the new year is here, resolutions are being broken almost as much as marriages are in Hollywood. The question is, how can we stick to our resolutions or develop new habits.  Well, I don't have the answers, but Tim Ferris has a few.  Old dogs can learn new tricks, and appraisers can break outside their comfort zone.  Check out Tim's article on developing your habits.