Embracing Innovation | How Technology Can Make Appraisers More Efficient
As technology continues to improve and automation is on the rise, anxiety among appraisers has reached a fever pitch. While artificial intelligence and predictive software have made the appraisal process increasingly easier, many appraisers are wary of being worked out of a job by a computer crunching numbers. Adding to fears, Fannie Mae and Freddie Mac have begun “[waiving] the new appraisal requirement for homes where the loan-to-value ratio is low. Instead, they’ll accept any appraisals on file from the last five years.”
However, industry stalwarts remain firm that there is no replacement for the crucial job that appraisers perform. While computing power may increase efficiency by cutting down time spent on calculations, it is no substitute for a trained eye and knowledgeable appraiser. According to Zillow, appraisers look at the “condition of the property and the overall real estate market in the area (what are similar homes selling for?). The appraiser will note any flaws to the property (a leaky roof or cracked foundation), the area around your home (is this home in a development?) and even the estimated time it would take to sell the property.” Going far beyond raw square footage and type of home, it’s easy to see why an appraisal is a better insight into market value than a formula with input data values.
An article in Valuation Review cites the fact that “extenuating circumstances may not be picked up by the existing data records – e.g., is there a unique element that might otherwise impact the value such as telephone lines or environmental problems in close proximity that might be viewed by an appraiser but not caught within a dataset.”
LRES Chief Strategy Officer Mark Johnson commented that questions of “reliability and validity is bound to surface when a machine is spitting out value numbers left and right,” and that “an appraiser can substantially increase his/her own productivity” by letting computers handle the grunt work of data collection and math while he/she focuses on evaluating the property submarket dynamics and other attributes not recorded by data sets.
Janus AMC is dedicated to an ongoing partnership with our appraisers. We value the expertise they bring to the process and know that we could not be successful without their knowledge and skills. Janus is committed to combining appraiser insights with the latest technology to provide top quality appraisal management. Check back soon for more technology updates.