Career in Real Estate Appraisal
The Appraisal
Education Network School ~ 631-563-7720
ADDITIONAL LINK TO SEEKING
EMPLOYMENT AS AN APPRAISER-CLICK HERE IF YOU ARE ALREADY A LICENSED
APPRAISER ASSISTANT IN NY STATE
So you've decided you'd like to get into real estate appraisal!
Appraising real estate is an excellent career choice for many people.
Yet, like any other field, it is not necessarily for everyone. In this
brief article we will try to answer some of your questions about
appraising real state, what the job is like, what kind of income
potential you can expect and how you can become a real estate appraiser.
What an
appraiser does
Real estate appraisal, like
most aspects of the real estate profession, is a mixed bag of tasks. For
one thing, there are many different kinds of property - homes, offices,
retail, apartments, industrial, agricultural, development land - just to
name the most common. Each type of property presents unique appraisal
challenges, so appraisers (the same as salespersons) tend to specialize
in just certain kinds of property.
In addition to the various kinds of properties, there are also
various tasks which must be performed in completing an appraisal
assignment. An appraiser starts with securing the appraisal order and
determining the exact interest in the property which the client wants
appraised and the definition of market value the client is looking for.
For example, if you have an order to appraise the value of a long-term
leasehold, your approach will be vastly different than if you are asked
to appraise an ownership interest.
Occasionally an appraiser will be required to complete an extensive
analysis of the highest and best use of the property. Many properties
could be used for various purposes, and the value would be different for
each. Selecting which use is the highest and best use is
fundamental to the actual appraisal of the property. Highest and
best use analyses are common when the property is vacant land or when an
existing structure must be converted to another use. Sometimes
appraisers are asked merely to report the highest and best use, without
regard to the actual value of the property.
Finally the appraiser is ready to begin collecting data. This
involves physical inspection of the property, measuring the
improvements, preparing a site drawing, writing the physical description
of the property and other matters which must be stated in the final
appraisal report. The appraiser also collects information about
comparable sales, income potential, and the cost to reproduce the
improvements. Accomplishing these tasks generally requires considerable
legwork and travel time. Most clients also insist that the appraiser
inspect the property, not just to determine its market value, but also
for any defects which must be disclosed to buyers. To complete the
appraisal process the appraiser must write the appraisal report. Some
clients require and extensive report which may run from ten to twelve
pages for a simple residential property to hundreds of pages for complex
multi-property appraisal. Other clients (generally lenders) are
satisfied with a standard form appraisal report which can usually be
completed by filling in the blanks on a five to six page standard form.
Your
income - Who will pay you and how much
Today
there is a strong demand for appraisal services. However, this has not
always been the case. Although buyers, sellers and owners account for a
significant number of appraisal orders, the majority of appraisals are
ordered by lending institutions. Obviously then, when loan demand
slackens, the demand for appraisals falls off as well. Still, even in
times of tight money when real estate sales are slow, a professional
appraiser with established clientele continue to earn a living.
Even when times are so bad that foreclosures become prevalent, an
appraiser is still in demand because most foreclosures require
appraisals.
In short, when real state activity falls off, appraisers lose
business, but their business does not fall off nearly as much as real
estate sales.
Appraisers today typically charge $275-$450 for a simple appraisal of
a single-family home. Fees for more complicated appraisals are clearly
much higher, sometimes many thousands of dollars. How much and appraiser
charges is determined by how much work the appraisal will be. Obviously,
the appraiser's skill, experience and background will command a higher
fee and allow the appraiser to complete the task more efficiently.
However, by law, fees cannot be set as a percentage of the value. If you
work for an appraisal firm, you will earn a negotiated percentage of the
fee charged or you may be on salary and required to perform a minimum
number of appraisal per week to justify your guaranteed wages.
You should also bear in mind that when business falls off, appraisers
are forced to charge more competitive fees. And appraisers have a lot of
expenses to pay out of the gross fees earned - auto and travel expenses,
errors and omissions insurance, professional dues and license fees,
computer access fees - just to name a few. Then too, if you start by
working for another appraiser, you can also expect that your employer
will be entitled to a percentage of each appraisal fee that you earn.
This has a benefit, however, since you will not be required to spend
money to start your own firm. Even after appraisers become experienced
in New York, many work for firms as compared to working for themselves.
This is something that is up to the individual appraiser.
Becoming an
appraiser-The Education Needed is...
The Appraiser Certification and Licensure
Board has created four categories of appraisers. The requirements for
each are different, and therefore each category affords different
privileges.
The first category, Licenses appraiser assistant is also the first
step in obtaining any license or certification given by the Appraiser
Certification and Licensure Board. There is no experience needed nor is there an
exam required. An appraiser assistant may assist in the preparation of
any and all components of appraisal reports. Typically, while obtaining
your experience, one would work under the supervision of a state
licensed or state certified appraiser in New York State.
The most comprehensive category is the State
Certified General Appraiser. With this certification you can perform
appraisals for all types of real property. To become a State Certified
General Appraiser you need to pass the General Certification
examination, have at least 2.5 years of acceptable appraisal experience,
appraisal education and college coursework. NYS has details on this.
A State Certified Residential Appraiser may appraise
all types of one-to-four family residential real property, without
regard to complexity or transaction value. You must pass the
Residential Certification Exam and show proof of 2 years acceptable
appraisal experience. There is appraisal education and college required
for this level.
Still another category is the Fully Licensed Appraiser. With this
license, you may appraise non-complex, one-to-four family residential
units having a transaction value of less the $1,000,000, complex
one-to-four family residential units having transaction value of less
than $250,000 and all other types of real property having a transaction
value of less than $250,000. You must have meet the education, pass the License examination and have at least 2
years of acceptable experience in New York State.
Getting a
job-How to get employment in New York
As you have gathered from the preceding
discussion of appraisal licensing, newcomers in appraisal need appraisal
experience to get their license. The usual way to do this is to work for
an appraisal firm. This may be somewhat of a challenge. Some appraisers
are leery due to the liability that comes with supervising an assistant.
They may also feel that if you have to be supervised every moment, then
they might as well have taken the time to perform the work themselves.
For Example, lenders in particular, have special forms they want filled
out and there are specific rules for what must be place in which blanks.
Not all of this information is covered in licensing classes, and
post-license classes for beginning appraisers are virtually
non-existent. We have an additional web site that discusses how to
secure employment once you have completed your education. We recommend
once you have completed the state mandated education, you pursue the
"Mock " Appraisal. An appraisal which our school will review for you to
make sure it means not only appraisal standards and guidelines, but also
USPAP guidelines. After you have finished with this site, check the Appraisal
Education Network and Merrell Institute Open House web site.
Nevertheless, we do not want you to become discouraged. If you really
want to appraise real state, you can find someone who will help you get
started. First, perhaps they will let you type up the reports, then they
will start you on locating comparable sales, until bit by bit you learn
the practice. Finding someone who will help you get started may require
a little persistence, but finding a real career/job always requires
legwork. Eventually you can gain enough experience and additional
education that you can become independently licensed. Ultimately you
will be able to develop your own clientele and run your own practice.
Many fully licensed and certified appraisers don't open their own firms.
They are satisfied working work a larger appraisal firm.
In any event, your first step is to form a commitment to yourself to
make real state appraisal your career. Obstacles such as passing the
exam or finding an appraiser to hire you become minor once you have made
the commitment. Having made the commitment, then your next step is to
enroll in the appropriate courses and get started. Your success in real
estate appraisal is founded entirely on your own determination to
succeed. No one can stand in your way if you really want success!
License
exemptions
Review Appraisers, such as Underwriters are not required to be
Licensed or Certified, although they are required to adhere to USPAP
guidelines, which is taught as part of the National USPAP course which
has been developed by the Appraisal Foundation. We have a License
agreement to offer this course. License # 1022.
You should be aware that most lenders today sell their loans in
the secondary mortgage market. Standards for appraisal work are
generally dictated by the secondary market, not the local lender and as
such, lenders are increasingly requiring all those involved in Appraisal
to have the required education and in many cases a License or
certification as well.
Underwriters and processors for Lenders are also involved with the
appraisal process and may even review and overview the appraisal, yet
they are not required to be licensed or certified in New York State.
Many decide to become Licensed to add the their credentials.
Another way to be involved in the field of appraisal without a
license is to do so for agency of state or local government. One of the
largest sources of government employment for appraisers is property
taxation. Since property taxes are levied according to value,
maintenance of accurate assessment rolls is a vital part of the property
tax process. Assessors have their own rules and regulations in this
field, however they do use the same type courses which the Appraisal
Education Network School offers in New York State. In Nassau County
alone, hundred of people were involved in the reassessment and there are
hundreds more involved with correction and challenging of the final
roles.
For
Additional Information
For specific information about
the exams and for application forms, contact us at:
631-563-7720 (Appraisal Education Network School) You may also
contact the State for an appraisal application at 518-474-4429 or visit
the state of New York on-line- (see our
yellow pages for internet address)
A
Schedule of the Appraisal Courses in New York State, Click here! |