Editor’s note: Robert Bruss is temporarily away. The following column from Bruss’ “Best of” collection first appeared Sunday, May 7, 2006.
If you think you might like to become a real estate appraiser, first read “How to Get Started in the Real Estate Appraisal Business” by Daniel J. Nahorney. After you learn how difficult it is to get started and the very low pay for trainees who must acquire 2,000 experience hours, plus taking training courses to qualify for the basic appraiser’s exam, you might consider another career.
The author is not an appraiser, but he interviewed many longtime successful appraisers who responded with glowing reports about the wonders of the appraisal profession. However, Nahorney doesn’t hesitate to emphasize the negatives of being an appraiser, such as the very low starting pay, and extreme pressure from some mortgage lenders and borrowers to “hit the mark” and appraise for a specific home valuation.
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Throughout the book, the author emphasizes the importance for a new trainee to embrace technology, which Nahorney says is the future of appraisals. He explains the importance of automated valuation models (AVMs), which can eliminate or minimize the need for an appraiser, thus reducing an appraiser’s income.
Nahorney notes the appraisal industry trend for successful appraisers is to specialize in a specific type of real estate, such as commercial buildings or luxury houses, and then become the local appraisal expert in that field. He also emphasizes mortgage lenders want appraisals, which are “better, faster and cheaper.”
Although the author tries to maintain a positive, upbeat attitude, he failed to interview any new appraisers or current trainees who are just getting started. Instead, he talked with “old timer” appraisers who have been involved in the profession at least 15 years.
Reading between the lines, it becomes painfully obvious it is very difficult for a beginner trainee to get started by finding an experienced appraiser willing to take on a raw recruit and pay him or her a living wage.
But Nahorney saves the worst news until the Appendix where he explains the even tougher appraiser licensing standards, which become effective for new licensees in 2008. In addition to the 2,000 hours of trainee experience required, the course requirements become more extensive and college degrees become required to appraise more than four-unit residential properties.
This realistic book is definitely not a “puff piece” for the appraisal profession. Instead, it is a critical look at a field that is vulnerable to charges of fraud and corruption by a very few appraisers, but in which is difficult to earn a modest living, at least at the start.
Although Nohorney is rather charitable toward the Appraisal Foundation, which establishes the often impossible to understand constantly changing Uniform Standards of Professional Appraisal Practice (USPAP) rules, he realizes their Appraiser Qualifications Board (AQB) establishes the minimum qualifications.
Chapter topics include: “Looking in at the Profession”; “From Outsider to Trainee”; “Choosing a Direction”; and “External Forces Changing the Profession.” Everyone interested in becoming a professional appraiser should real this book, which reveals mostly unknown downside of starting out as an appraiser.
After reading this realistic book, having been involved with real estate more than 35 years, I find it impossible to believe any fully informed young person would want to tolerate all the drawbacks and become an appraiser when there are so many better real estate opportunities. The author is to be commended for honestly writing about a very difficult topic. On my scale of one to 10, this excellent book rates a solid 10.
“How to Get Started in the Real Estate Appraisal Business,” by Daniel J. Nahorney (McGraw-Hill, New York), 2006, $21.95, 123 pages; available in stock or by special order at local bookstores, public libraries, and www.Amazon.com.
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Real Estate Center).