ANAHEIM (November 12, 2011) - Accurate home appraisal valuations are vital in today’s market; inaccurate appraisals can slow down or even cancel a home sale. Today Realtors® and other real estate experts gathered at the “Appraisals: What You Absolutely Need to Know” forum during the Realtors® Conference & Expo to address this pressing issue.
“In today’s market, home appraisals that fail to provide accurate valuation are causing many sales to be cancelled or postponed,” said National Association of Realtors® President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “NAR has long advocated an independent appraisal process and enhanced education requirements that allow appraisers to produce the most accurate appraisal reports possible.”
Members of the panel included industry lenders and appraisers who identified common appraisal problems. These include appraisers who are unfamiliar with the neighborhood or area in which they are working and the increased lender use of Automated Valuation Models, which rely on computer-generated appraisals instead of licensed appraisal professionals. In addition, many buyers are purchasing more homes through foreclosures and short sales, and these homes typically sell for approximately 20 percent less than traditional homes in the same area, which can also make accurate valuations more difficult.
“A quality appraisal is a credible opinion of value that supports facts, reasoning and analysis,” said panelist Frank Gregoire of Gregoire & Gregoire, Inc. “The reality is there are people out there conducting appraisals who are motivated by money and a desire to get the job done as quickly as possible. It’s not right, but it’s a reality. This must change.”
Several participants shared their frustrations and experiences in dealing with the fallout from low appraisals. In a recent Realtors® Confidence Index survey, 18 percent of Realtors® reported a recent contract cancellation or delay as a result of a low appraisal.
“Ensuring accurate home valuations is critical, and NAR is committed to working toward that goal,” said Phipps.
For more information on issues related to appraisals and what NAR is doing to address them, visit www.realtor.org/appraisal
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
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Information about NAR is available at www.realtor.org. News releases are posted in the Web site’s “News Media” section in the NAR Media Center.
REALTOR® is a registered collective membership mark which may be used only by real estate professionals who are members of the NATIONAL ASSOCIATION OF REALTORS® and subscribe to its strict Code of Ethics. Not all real estate agents are REALTORS®. All REALTORS® are members of NAR.