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Wall Street Journal Questions Property Appraisal Accuracy

August 18, 2009

P R O P E R T Y   S E A R C H

R E S T I V O – H E C H T M A N    T E A M

Out-of area appraisers are the name of the game in Miami these days.  How do these appraisals affect  property sales? Do out-of-area appraisers actually have adequate knowledge about neighborhoods they are covering?  How do they come up with accurate appraised values? What about school boundaries/ratings/or projected plans? What about local market nuances?  Do they have the necessary, pertinent information for determining neighborhood property values? 

As reported in the Wall Street Journal, August 18th: “Squeezed by a drop in fees, some appraisers are compensating by driving long distances to handle more assignments. Their wanderings are raising questions about whether they know enough about the neighborhoods to accurately assess the value of homes—which has implications for both home buyers and owners.”   For the full Wall Street Journal article, “Reappraising Home Appraisers” written by James R. Hagerty… click here.

Brian L. Frank for The Wall Street Journal

Hagerty goes on to say:  “Appraisers like Evie Salazar     are traveling far afield to find work. In June, Evie Salazar traveled about 75 miles from    her office to do an appraisal. Usually, Ms. Salazar says, she tries to work within about 40 miles of her home, but business was slow at the time she accepted that job.” “You do what you’ve got to do at times to feed the family and pay the bills.”

‘Desk top’ appraisal reviews are fairly common these days, not to mention ‘drive by appraisals’. Lenders are now outsourcing appraisals at fees substantially below what  lenders normally pay, and I must say, I have to wonder what the long term affects of this outsourcing might be. 

Realtors and loan officers, more often than not, have no say whatsoever in selecting an appraiser. In Miami, appraisers are coming from as far as 50-75 miles away, which concerns me. It takes me back to the question, “Does an out-of-area appraiser have sufficient knowledge about the area they’re sent to cover?” 

I prepare a Comparative Market Analysis (for myself, my buyers/sellers) and I make it available to the appraiser as well.  Often it’s helpful, particularly if the appraiser  is less than familiar with the local area. 

Whether buying or selling,  use a Realtor… a good one!  Much goes on behind the scenes (from the moment the offer is written, all the way to closing)!  Avoid your deal turning into the dreaded “deal breaker”… Work with a really, really, really good Realtor and make sure your sale actually “goes through”.  It’s not enough to sit by the sidelines and cross your fingers.   Getting a buyer is just step one.   Getting to the closing table… walking away with keys and title… is the finish line.  For more information on buying and selling property in South Florida, visit  Blog and Website MiamiRealEstateCafe.com

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