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26 | TH E M R EP O RT FEATURE we are aware of the challenges appraisers face and work toward preserving a well-trained, com- petent workforce of professional appraisers in the years ahead. WILLIAM FALL , MAI, SRA, ASA is Founder and CEO of William Fall Group and its AMC subsidiary, Valuation Partners. A General Certified Appraiser credentialed in five states, Fall has taught real estate valuation courses at the university level and has served as a supervisory appraiser for numerous apprentice/trainees. He can be reached at wfall@valuationpartners.com. * * * Yearning for Big Data and Big Tech H ow important is it to have the right tools for a job? For example, imagine you are in the process of renovating a bathroom, when you realize the wrenches and pliers you have in your tool belt are plastic toys from your kid's playset. Will that hamper your ability to complete the work necessary in order to realize the bathroom renovation you had in mind? What if you were to find yourself in a situation that required an ice axe in order for you to summit a peak, but instead of finding your trusty Grivel Air Tech Evo strapped to your pack, you find a small hob - by hammer that would only be useful if you were endeavoring to complete an arts and crafts project. How successful is your summit attempt likely to be? The same logic can be ap - plied to the residential ap- praisal profession. Is it possible to meet the needs of today's lenders and AMCs with the tools currently available to the residential appraiser community? Unfortunately, until appraisers are provided more advanced tech- and data-centric appraisal production tools—the kinds of offerings that have previously been reserved for investors, lend - ers, and AMCs—the answer is a resounding, "NO." The Shifting Information Advantage R esidential appraisers work- ing in the mortgage lend- ing space are woefully unde- requipped to meet the needs of the client base they serve. In years past, before the advent of "Big Data," lenders and origina - tors heavily relied on appraisers to inform them on what was occurring in a subject property's market. An appraiser would source comparable sales from MLS books obtained from the local Realtors' office, or from his or her own business' database of previous assignments. In later years, the appraiser would obtain public records data from CDs (remember those things?) purchased monthly from early versions of data aggregators. They would also pull MLS records from DOS-based sys - tems, which at the time was a significant improvement over the MLS books that had been previously used. More recently, the appraiser would leverage his or her local Web-based MLS system, public records, and per - mitting databases to perform his or her job function. In all of the aforementioned scenarios, the appraiser was the conduit by which market data was obtained and disseminated to clients, but times have decidedly changed. Advancements in technology revolving around data offer - ings made it much easier for an appraiser to come by the information needed for them to complete an assignment, but the digitization of this data opened up the floodgates for analytics companies that envisioned taking this newly-found content and productizing it in a way that would allow them to sell their offerings directly to the lender or AMC. Today, the appraiser's client has access to the same re - sources that had previously been reserved for appraisers. Instead of relying on the appraiser to paint a picture of the market in the form of his or her delivered appraisal report, the appraiser's client relies on third-party data and analytics to refute or qualify the appraiser's findings. The informational advantage has officially trended away from the appraiser and now leans heavily in the direction of the users of appraisal products and services. An Inundation of Revision Requests F or appraisers who have been performing field work since the last millennia, the changes that have transpired are palpa- ble. Today, the way an appraiser completes an assignment and assigns a value opinion remains relatively unchanged, but the requirements and complexity of current appraisal requests de- mands greater utilization of data and analytics in order to reduce the percentage of addendum and revision requests emanating from AMCs and lenders. In decades past, it was un- common for an underwriter to question an appraiser's findings. When it did happen, it was typi- cally tied to assignments where the nature of the subject prop- erty, or the market in which it was located, increased the overall complexity of the assignment. In this case, the appraiser wouldn't be caught off guard if/when a client made a request for clarifi- cation or additional information. Now, if an appraiser submits a completed report on even the most rudimentary assignment, and he or she doesn't receive an addendum or revision request, it's considered an outlier. How can that be? Isn't the appraiser acting as a trusted advisor on behalf of the client that en - gaged them on the assignment? Doesn't the client implicitly trust the opinion of the appraiser? If they did, would the AMC or lender continually bombard the appraiser with questions or concerns on the vast majority of appraisals? The reality is, most AMCs and lenders have greater insights into the market—includ- ing visibility into all relevant data—than even the most sophis- ticated residential appraisers. Recapturing the Information Advantage I f we as a profession want to recapture the informational advantage that's been lost in recent years, we must have tools that are at least commensurate, if not superior, to those being used by the AMCs and lenders we are working for. Until the organiza- tions that provide appraisers with production software are able to deliver applications that mirror the analytics suites being used at a transactional level by an origina- tor, the appraiser will continually suffer through the kind of back- and-forth with their clients that have become standard operating procedure for the typical service provider. Improving upon the technol- ogy currently being employed by most appraisers will not only prove to minimize the time an appraiser spends on an assign- ment throughout production and post initial delivery, but it will also increase the AMCs'/ lenders' reliance on the appraisal report itself. This alone has the potential to improve the transac- tional economics associated with residential appraisal practice. An End to Fee Stagnation D uring a recent industry con- ference, there was consider- able focus placed on the fees being paid for a typical appraisal by the majority of appraisers in attendance. Most commented that the fees haven't increased in a meaningful way in more than By Jordan Petkovski