The importance of appraisal professionals keeping an open mind
After over 30 years in the valuation industry, I’m still astonished by the advancements in technology and how they have changed the landscape of our business. Just like how courthouse runners and MLS books are a thing of the past, technology is enhancing the valuation process from assignment to delivery. As the world we live in continues to adopt automation and big data tools, the process we use to appraise is bound to change with the times, as well. Yet, the industry’s reliance on professional appraisers has remained, and will remain, constant throughout the years of innovation.
So, what’s next for the appraisal profession? As the use of data and analytics broadens, the appraisal industry is increasing its use of technology to drive production. Appraisers must continue to foster innovation in every aspect of their business. A more efficient appraisal process using data and analytics will, in turn, increase the capacity of each individual appraiser, reducing turn times and enhancing the consumer experience.
Professional appraisers must embrace testing new processes to continue to improve the workflow for their business. To stay in-the-know about what’s trending in mobile technology and data services, appraisers should get out from behind the keyboard and attend meetings such as Valuation Expo or a continuing education class with their peers. These “meeting of the minds” are critical for thought-provoking discovery that maybe, just maybe, there’s a better way. With the nation’s largest database of property records, my company has challenged me to develop ideas around how we can empower valuation professionals to become more efficient by utilizing data. Developing strategies in a vacuum is not productive. I’ve found that attending industry meetings and collaborating with my peers allows me to quickly vet and improve processes back at the office.
It’s important to remember that appraisers are paid for their analysis – not their data gathering skills. That’s why I’m a strong proponent of providing factual data to appraisers at the time of assignment, so that they can verify and provide commentary – improving the overall appraisal process. When appraisers receive all of the factual property data up front, they spend less time conducting the research themselves, and less time preparing reports. This method has shortened our overall appraisal production about 45 minutes per assignment on average. Technology helps us “scrub” different data points and highlight differences between sources. Then, the appraiser can report the source they used and, when necessary, explain narratively why they chose that source. Because appraisers are looking at the same public record and listing data that the AMC or Lender has access to, appraisers also have an opportunity to get in front of those questions, improving credibility and reducing revision requests.
At a recent Valuation Expo session, the attendees were asked, “If the appraisal process was mapped out, including the time and effort required for each phase, what would be the average time spent conducting research? Consider everything involved, which processes are best handled by a trained analyst, and what can be handled by others and/or through the use of technology?” Discussions led to the notion that providing factual data to appraisers at the time of assignment will empower them to spend less time on research and more time on analysis to produce higher quality and substantiated valuations.
When pressed to come up with more “efficiencies,” the consensus of the group was that, for some properties and assignments, someone other than the appraiser could inspect the subject property to gather its physical characteristics. Taking that a step further, to ensure credible findings were supplied, a straightforward mobile app that guided a trained professional through the inspection process would be necessary. Then, once the inspector syncs their data to the cloud, the appraiser back at the office could import the majority of the required property information directly into their appraisal report. All that would be left to do is validate the findings through integrated public record and listing data sources before proceeding to the technical part of the appraisal, including analysis and reconciliation.
For years there has been concern that technology may one day replace appraisers. I believe that if we embrace change and position ourselves as the subject matter expert, appraisers will continue to be in demand. Will technology, including data and mobile technology, change the appraisal profession by altering the process and scope of work for traditional appraisals? Absolutely! And, appraisers who are open-minded and embrace change will continue to do well in this new world. Using technology to transform and re-invent the appraisal development process from borrower application to loan closing will benefit appraisers, lenders, investors, and most importantly, consumers.
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