Appraiser in your Inner Circle?

Today we are going to touch on some of the challenges real estate agents face, some common concerns related to their business. There is a fairly low barrier to entry to be a real estate agent, which isn’t good or bad, but it does mean that there is more competition out there when you’re first starting out. Those who have been in the industry for some time have begun to reap the benefits of staying consistent and persistent on growing their business. These folks cultivate the relationships of their clients by staying top of mind, ask for referrals, or differentiate themselves from the pack thereby demonstrating their ability to service their clients in a way that no one else seems to be doing.

What are some other challenges or concerns that agents face?

Market fluctuations, economic downturns, and regulatory changes can potentially impact your income, property prices and the demand for those properties can change seemingly on a dime, as they say. Things were great over the last few years after 2020 weren’t they? But now, things have become a bit more challenging. What was selling for top dollar is no longer the case. There are more seller concessions and buy down options but here in central Florida, the demand is still pretty high and we still have a shortage of supply. So how are you pricing properties?

Technology can be a challenge. Some can embrace technology and leverage it as a tool to grow their business while others struggle to incorporate it into their businesses. Technology can include the tools Stellar offers in their suite of products or it can mean social media or even the way folks are buying and selling houses with the likes of Opendoor and some others that are out there.

Reputation and client satisfaction is another challenge as those two things are crucial for an agent’s long-term success is it not? Negative reviews or a bad experience can affect ones ability to attract new clients or maintain existing ones. And how are you maintaining those relationships? How do you stay top of mind for your client to either continue referring you after their transaction has closed or to ensure that you are the person they are going to call in 3-5 years when they are ready to make their next move.

I have to say, these challenges that I mentioned aren’t just specific to agents. When you think about it, they sound like challenges any business can face regardless of the industry. In appraising we face the same the challenges as well, so we are right there with you. The barrier to entry for us is fairly high. We need to complete 100 hours of qualifying education and pass a state exam to become a licensed appraiser trainee. We get the background check, pay our required fee to DBPR and get our trainee license. Then we need to find a supervisor willing to take us into their business and train us for the minimum required 1,500 hours of logged experience in no less than 12 months. Meaning everything a trainee does on each report they work on must be logged in a worksheet, verified and signed by their supervisor an submitted to the state before they can even think of becoming a certified appraiser. When a trainee has achieved those requirements, passing the exam, finding a supervisor and gaining 1500 hours of experience  - THEN in order to become a certified appraiser, they need another 150 hours of qualifying education, pass another exam, and 2,000 hours of logged work experience in no less than 24 months. Oh, and if they want to grow their own business and take on a trainee of their own, they need 3 years of experience before the state will allow them to take on a trainee. Talk about a high barrier to entry! No wonder you can’t find an appraiser when you need one.

But I digress, let’s get back to you, so we have market fluctuations, technology and reputation & client satisfaction as challenges. Hopefully you also have a network of professionals that you either have gathered along the way or are looking to obtain. What I mean by that is, who do you have as your inner circle, your tribe, your core? Do you have a lender that you trust will take care of your client and get you that approval letter even though it’s 11pm the day before a holiday? How about a real estate attorney that has your back when your client has some complex issue to handle before they sell? A title company to ensure that property is clear and ready to sell. An insurance agent to get your clients the best coverage for their new purchase. Or a general contractor or handyman to get that chipped paint scraped, cleaned and repainted for the property you’re selling to an FHA buyer? A home inspector to help identify those pesky items that can come up and help you negotiate?

If you have those people in your corner that you know you can call and they will take care of you because they know how important this sale is and they want to do the best job so that you both can continue to do business together in the future.

How about an appraiser? Do you have one of those in your inner circle? Is that even allowed? I would argue that it is. It’s ok and in fact, you SHOULD have an appraiser that you know and trust, in your inner circle, your core network. Now, as appraisers, we have some strict requirements when it comes to appraising a house for a federally related finance transaction where the client is the lender. And that’s typically how you come into contact with an appraiser. After the contract is signed, the lender sends out an appraiser, the appraiser needs access to the property, they call you.

BUT, what if you had an appraiser in your corner before that contract was ever signed?! What if an appraiser was in your corner and even dare I say, helped you with some of the challenges WE ALL face in our businesses?

Market fluctuations, technology, client satisfaction & reputation. Having the right appraiser in your network can absolutely help you with each of these challenges. An appraiser has their finger on the pulse of what’s happening in their market. It’s their job to know that. We report on what has happened, not what’s going to happen in the future, but we analyze what has happened in the markets we serve with data science tools (linear regression, polynomial trends, statistical analysis, sensitivity analysis, etc). You should be able to call up your appraiser and verify what YOU are seeing in the market.

Hey appraiser, on my end I’m seeing some sale prices going down, but I feel like demand is still super high. I’ve got this listing in this subdivision called _________fill in the blank. Are you seeing the trends declining in this neighborhood? You should be able to have a conversation like that.

Let’s talk technology – Hey appraiser, My client is telling me their house has 1800sf but when I look at the county records, it’s only 1400 sf, could you come out and measure this house so I can clear this up? I’d love to be able to add the floor plan to my listing so that potential buyers see what a great layout this listing has and can start picturing where how they’ll configure their bedroom or living room? Or... hey appraiser, I’m doing a series on my social media about how to prepare your home for an appraisal, can we work on this together so I can interview you for the post and my client can see that we have a team of field experts so they can trust us with all their home buying or selling needs?

Reputation/Client satisfaction – Hey appraiser, I’ve been working on getting this listing for months. If I do, it will be the biggest sale I’ve ever had. But the owner passed away, my client is the owner’s daughter and before they can move forward with selling, they have to find out the value of the home as of the date of the owner’s passing for tax purposes…..help…when can you come out?

This is just the tip of the iceberg folks. We are sympatico…we work well together, we complement each other’s businesses. We have the same challenges in our businesses and by pairing up, being in each other’s network, we are building our tribe of trusted and reliable professionals that understand in a referral based business, customer satisfaction, engagement, education of the market, and leveraging technology and each other is key to our shared success.

Find your local appraiser, find one that fits into your inner circle and that can help you with these things in your business.

That is it for today my friends. Come back again for more Valuation Bytes. I hope today is better than yesterday and my hope for tomorrow is the same. Make it a great day, be safe, and be kind. See you next time!