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Reflecting on Appraiser Fees & The Future

July 29th, 2013 by Bill Collins Leave a reply »

Recent Real Estate Reports

The National Association of Realtors released their pending home sales for June yesterday which reported a drop of 0.4% from a downwardly revised figure for May and an increase of 10.9% from June of 2012. 

Regional breakdowns: pending home sales in the Northeast were unchanged month to month but up 12.2% from the same month last year; the Midwest dropped 1.0% month to month but was up 19.5% year to year; pending sales in the South were down 2.1% on a monthly basis but were up 9.5% from one year ago; and the West saw increases both month to month (+3.3%) and year to year (+4.4%).

Lender Processing Services (LPS) released their May Home Price Index yesterday.  They reported that the average home price reached $226,000 in May, up 1.3% from April and 7.9% from one year ago.  The report noted that the average home price nationally was still down 16.3% from the market peak in June of 2006.  Nevada, California and Arizona reported the biggest month to month increases with South Carolina and Wisconsin showing the biggest declines.

Last Friday, the Federal Housing Finance Agency (FHFA) reported that almost 85,000 mortgages were refinanced through the Home Affordable Refinance Program (HARP), 20% of all refinance mortgages.  This was down from the previous month but still brought the total to 2.65 million HARP refinances since the program’s inception.  The FHFA noted that 19% of the HARP loans last month were at loan to value rations greater than 125%.

A link to the FHFA May Refinance Report is found here: FHFA Refinance Report May 2013

Last Wednesday, the Commerce Department reported a large increase in the sales of new single family homes  from the previous month (+8.3%) and the same month last year (+38.1%).  Sales reached their highest level last month since May of 2008.

CoStar Group reported last Thursday that the office market was showing modest signs of improvement.  Net absorption of office space for the first half of 2013 was up 25% over the same period last year and the national vacancy rate had declined to 12.1% from 12.7% one year ago.  A major factor in this increased absorption and lower vacancy rate is the low level of new construction in most markets; CoStar reported that office space under construction during the first half of 2013 was just 0.08% of the total inventory, comparable to the same period last year.  It was noted by CoStar that approximately half of the vacancy decline was linked to the demolition or conversion of office space to other uses, such as residential.  CoStar projects a continued slow decline in the office vacancy rate to approximately 11% by 2016.

Average office rents were up by 2% during the first half of this year compared with 1.7% during the comparable period last year.  An exception to this modest increase was San Francisco where rents jumped by 10.7% during the first half of 2013.  CoStar projects that the owners of office buildings will see increasing net operating incomes as the leases signed from 2008 through 2010 expire and are replaced by new ones at the higher rental rates.

Real estate reports coming later today: the Case-Shiller report will be out shortly along with CoStar Group’s report on the industrial market for the first half of 2013.

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Comments on Appraisal Fee Study Discussed in Our Last Newsletter

Virginia appraiser Billy Robinson had this to say about appraisal fees in his market area: “I am a real estate appraiser here in Virginia and we are lucky to get $250 for an appraisal assignment…If you raise your fees to customary fees they don’t send you work…Thanks to all who ruined a great profession that I would not recommend to anyone now…”

Jack Van Wyk of Idaho 1 Appraisers, Inc. had this to say:
“Hey Bill, This study highlights exactly what one of the ongoing problems with AMCs and bank in-house ordering services.  They want to most often use statewide or even large regional fee averages to set fees.  There is little consideration for uniqueness or rural or acreage properties and the extra work that they entail.  My personal experience is that when I point these things out, in 99% of the cases they cancel the order.  Now, would you care to bet what happens after that?”

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To help appraisers evaluate which AMCs are right for them, we have compiled this directory of over 200 AMCs and National Appraisal Companies, listing complete, up-to-date contact information and other details for each listing.

If you’re looking to expand your appraisal practice, our Directory of Appraisal Management and National Appraisal Companies is a great place to start.

Download the directory today — at only $49.99, it will pay for itself with your first appraisal order.

Please visit our website now to make your purchase securely or contact us at (877) 434-2825 for more information on this exciting new directory!

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Appraisal Institute Survey Reports Many Appraisers Optimistic About Future; Appraisal Port Poll Finds Concern

In a news release on July 17th, the Appraisal Institute announced the findings of their survey which found that more than ¾ of appraisers were optimistic about the demand for their services over the next year or two.  80% of residential appraisers surveyed and 78% of commercial appraisers were “upbeat about their future” in this recently completed survey.  95% of the residential appraisers and 49% of the commercial appraisers reported increased demand for their services from one year ago.

The opposite results were found in a poll of appraisers last month with ¾ of appraisers anticipating business either slowing somewhat or a great deal.  A link to a graphical depiction of this poll is found here: Appraisal Port Poll Results

One final thought:  The conflicting results of these surveys seem to emphasize the importance of appraisers 1) increasing their skill sets (i.e. upgrading to a Certified General license) 2) pursuing a designation from a respected appraisal organization and 3) relying less on mortgage appraisal business and building their private appraisal practices.

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Rates & Dates

Freddie Mac, the Mortgage Brokers Association (MBA) and HSH Market Trends all reported decreasing mortgage interest rates in their most recent surveys. 

On July 25th, Freddie Mac reported that 30-year fixed-rate mortgages declined to 4.31% from the previous week’s rate of 4.37%, the second straight week of falling rates. They also noted that last year at this time the 30-year rate was 3.49%. 

The MBA in its most recent Weekly Mortgage Applications Survey released July 24th for the week ending July 19th, reported that 30-year rates with conforming loan balances ($417,500 or less) fell to 4.58% from the previous week’s rate of 4.68%.   The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) dropped to 4.66% from 4.81% one week earlier.  Rates for FHA backed mortgages also declined to 4.28% from the previous week’s rate of 4.38%. 

In their press release of July 25th, the MBA reported a decline of 1.2% in mortgage applications.  Refinance applications remained unchanged at 63% of all applications and the MBA reported that their Refinance Index was at its lowest level since July 2011. 

One day later, the MBA released their outlook on mortgage originations for the second half of this year which noted that:
“MBA expects originations in the second half of the year to total $606 billion, up from the $527 billion it had forecast at the beginning of the year but down considerably from the estimated $976 billion in originations during the first half of the year. 
The increase in the forecast is due almost entirely to carryover refinance loans originated during the second quarter that will close in the third quarter.  Purchase loan originations during the second half of the year are expected to total $312 billion versus the $299 billion originally forecast”.

On July 26th, HSH Market Trends (in a report titled “Rates Fall, But Don’t Get Used To It”) reported a drop in 30-year mortgage rates to 4.55% from 4.60% the previous week.  Rates for FHA-backed mortgages also fell from 4.22% to 4.18%. 

Additional information from Freddie Mac can be found by going to: Primary Mortgage Market Survey PMMS – Freddie Mac

Additional information from the Mortgage Bankers Association can be found by going to their site at: Research and Forecasts – Mortgage Bankers Association

Additional information from HSH can be found by going to: HSH.Com

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Ask Angie

We would first like to congratulate our most recent winner: Palm Beach Gardens, Florida appraiser Vicki Caplan.  Vicki was the first to answer correctly that Albert Einstein was the author of the first two quotes (“Imagination is more important than knowledge”; “Imagination is everything.  It is the preview of life’s coming attractions”) and that Mark Twain wrote that "You can’t depend on your eyes when your imagination is out of focus”.

Today’s questions:

1. Who Said: "90% of all millionaires became so through owning real estate"

a) Donald Trump
b) Napoleon Hill
c) Andrew Carnegie
d) Will Rogers
e) None of the above

2. Who said: "Every person who invests in well-selected real estate in a growing section of a prosperous community adopts the surest and safest method of becoming independent, for real estate is the basis of wealth."

a) Carol Galante
b) Lawrence Yun
c) Theodore Roosevelt
d) David Stevens
e) None of the above

3. Who said: "I would give a thousand furlongs of sea for an acre of barren ground."

a) Blackbeard
b) Micky Arison
c) William Shakespeare
d) Carl Hiaasen
e) None of the above

The first person to respond with the correct answers wins a choice of one of the following:

One Free Regular Listing on

A Free Copy of the Directory of Appraisal Management Companies (Available to Members of and FREE!)

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Tell us what you think!

We invite your responses to any of the issues raised in this newsletter. Please e-mail us at: with your thoughts!

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We really hope you find our newsletter to be informative!  If you have any input on future topics for discussion, please email me your questions and I will do my best to address them in the next issue.  If you want to look back at past issues you can see our archive at


Bill Collins, Appraiser Help Inc.

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