Real Esate

Where Do Appraisal-Related Adjustments Come From?

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Appraisal:

By: McKissock

appraisal adjustmentsAppraisal-related adjustments are not just guesses by the appraiser or “rules of thumb.” Nor are they calculated numbers used to mathematically force a preconceived adjusted market value estimate in support of a value conclusion for the subject property. We tend to think of appraisal-related adjustments, as they pertain to residential appraisal assignments, as usually having to do with the sales comparison approach. However, it may become necessary to also provide cost approach adjustments and/or income approach rental adjustments that are not only necessary, but also appropriate, defensible, and reasonable.

Keep reading to learn about specific guidelines for adjustments, where appraisal adjustments actually come from, and a real-life example of adjustments in action.

Common adjustment factors

Adjustment factors that frequently occur with residential properties include:

  • Real property rights conveyed
  • Financing terms
  • Conditions of sale, such as motivation
  • Market conditions affecting the subject property
  • Location
  • Physical characteristics for both the land and improvements
  • Various types of depreciation
  • Use considerations, such as zoning, water and riparian rights, environmental issues, building codes, and flood zones
  • And other factors that may affect the market value of the subject property

What adjustments are not supposed to be used?

The July 26, 2016 Fannie Mae Selling Guide provides some guidance pertaining to what Fannie Mae expects an adjustment not to be. Fannie Mae’s position is summarized as follows:

Fannie Mae does not have specific limitations or guidelines associated with net or gross adjustments. The number and/or amount of the dollar adjustments must not be the sole determinant in the acceptability of a comparable. Adjustments must reflect the market’s reaction to the difference in the properties. Appraisers should analyze the market for competitive comparable sales and apply adjustments with no arbitrary limits on adjustment sizes.

Freddie Mac has stated that adjustments must be sufficiently discussed by the appraiser. Also, without statistical or paired sales analysis, adjustments tend to be subjective and imprecise. If appraisers make precise adjustments to a comparable sale or rent—1, 2, or 7 percent, for instance—sufficient data or discussion should be provided to support their analysis.

So, just where do appraisal-related adjustments come from?

Most, if not all, adjustments should come directly from the real estate market affecting the subject property. The Uniform Standards of Professional Appraisal Practice (USPAP) require appraiser familiarity with the market area where the subject property is located and competence to complete the required appraisal process as stipulated in USPAP. However, there are those occasional unique properties that require the calculation and/or extraction of reasonable adjustments through extraordinary means.

A real-life example

Several years ago, I and another appraiser had taken very separate approaches to determine the actual market value adjustment caused by the removal of 30 beautiful, mature fir trees (50–80 feet in height) bordering an entrance driveway into a 10-acre home site with a high-end, 5,000-square-foot, 3-year-old, excellent-quality residence located thereon.

The trees on the east side of the entrance driveway were thought to be located on the 10-acre tract by the 10-acre tract’s owner. The property owner of the contiguous 50-acre tract argued that the line of trees were on his property. Two independent surveyors were hired to survey the 10-acre property and agreed that the trees were actually on the 10-acre site.

One day, upset, and not believing the surveyors’ findings, the owner of the 50-acre property decided to fell all of the trees in dispute while his neighbor was at work, leaving the stumps, but having the felled trees hauled away the same day to a lumber mill.

The adjustment problem here was that, according to professional tree growers, the only trees that could be used as replacement trees could not be greater than 20–30 feet in height. Trees of greater height could not be safely transported or successfully transplanted.

The question for me and the other appraiser was how could we support the market value adjustment for the now missing trees when it was impossible to replace the removed trees with equal-in-size-and-value trees?

Further complicating the appraisal process was the reality that no comparable sales existed within the subject property’s market area that could be used to extract an adjustment using paired sales analysis.

As stated earlier, two separate adjustment calculation approaches were used. The other appraiser had concluded that the trees should be treated just like the forestry industry considered similar trees being harvested from a stand of similar-in-height-and-quality trees. He stated that the adjustment should be equal to the stumpage value of the trees that were hauled off to the mill and nothing more.

By contrast, I had concluded that the trees lining the entrance driveway had contributed substantially greater value to the property as mature, growing, beautiful fir trees lining the entrance to a very nice property. But I couldn’t prove that opinion using paired sales that did not exist in that market, or some sort of statistical data which might prove up my position. Unfortunately, such documented statistical data didn’t exist either.

What did exist were six very experienced real estate brokers within the subject market area who agreed to provide me with their independent broker’s price opinions of the 10-acre property hypothetically being sold with the previously tree-lined entrance contrasted with the value of the property as a stump-lined entrance. To that statistical average price difference, I added the cost of the removal of the stumps plus the cost of the planting of the much smaller replacement trees that several local horticultural arborists had agreed with the maximum height that could be transplanted being 20–30 feet in height.

The difference between the two approaches to calculating the necessary adjustment for each appraisal report was substantial. The matter was finally resolved by a civil court judge over one year later, with the decision being in favor of my non-textbook adjustment methodology.

Many years earlier, as a new appraiser, I was taught that generally it is better to remove thorny thistles from your garden bed using a dull hoe instead of your bare hands—when that is all that is available. This adjustment example reminds me of that sage advice.

Even with very creative approaches to extracting adjustments from the market, it is a best practice to always carefully study and then extract the necessary adjustments from the current real estate market affecting the subject property. It is time to set any left-over adjustment “rules-of-thumb” or “guesses” aside—forever!

Article by Robert Grafe.

 Robert Grafe is a Texas Certified General Real Estate Appraiser. Robert began his appraisal career on Kodiak Island Alaska in 1971 while the Owner/Broker of R.E. Grafe & Company Real Estate. He has served as a deputy county assessor/appraiser, as the chief appraiser for two national banks, and as the managing appraiser for Valuation Service Company. Robert has an extensive background in arguing both sides of county and state property tax appraisal appeals. He specializes in real property litigation support, valuing commercial properties in transition, and real property tax assessment consultation, with over 40 years of experience. Visit his website at valuationservicecompany.com or email reg@valuationservicecompany.com.

3 Major Credit Bureaus

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What do you think, will it boost real estate sales?

Will it help dying appraisal profession?

On the 8th of June, there will be changes on how your credit is reported. These include:

• Collections that aren’t at least 180 days old will be rejected by the 3 major credit bureaus. You will now have time to pay them off before it is even reported.

• Medical collections will no longer show on credit reports as long as it is being paid (through either you or insurance)

• Collection accounts that have not been updated in six months or more will not be factored into scores.

• Any collection that did not result from a contract or agreement to pay by the consumer, will be removed.

 

What Does The Partial Rollback Of Dodd-Frank Mean For The Largest U.S. Banks?

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Trefis Team , Contributor
Last week, President Trump signed into law a partial rollback of the Dodd-Frank Act after the proposed changes cleared legislative hurdles in the Senate and the House. The Crapo bill dilutes some of the stringent regulations imposed by the Dodd-Frank Act on the U.S. financial system, and is primarily aimed at making things easier for small- and medium-sized U.S. banks, which were seen as being affected by the tougher rules in a disproportionate manner compared to their larger rivals.

But the bill did have things to offer to some of the largest U.S. banks – especially the two U.S. custody banking giants, BNY Mellon and State Street. Based on the changes proposed by the new bill, and using our interactive dashboards for BNY Mellon and State Street, we expect these two banks to return more cash to investors in the near future, as their profits improve marginally over coming years. As this will increase net margins and reduce outstanding shares for the banks going forward, this implies a small upside to these banks’ valuations.

A Quick Summary Of The Changes Implemented By The Bill Aimed At Banks
The Crapo Bill, formally signed as the Economic Growth, Regulatory Relief, and Consumer Protection Act, introduces changes on several aspects of the U.S. financial industry. The following is a summary of changes that target the bank holding companies:
Increase In SIFI Threshold

• Current regulations label all banks with more than $50 billion in assets as systemically important financial institutions, and subject them to higher regulatory scrutiny, in addition to stricter capital requirements. The bill increases the SIFI threshold to $100 billion, and will raise the threshold further to $250 billion after 18 months.

• Which Banks Are Affected? The Federal Reserve Board currently includes 38 banks with assets worth more than $50 billion in its rigorous annual stress tests. This figure will fall to just 12 given the new threshold, as nearly all regional banks will now be exempt from stricter regulatory oversight. Notably, investment banking giants Goldman Sachs and Morgan Stanley will not get any respite because of their identification as Global SIFIs by the Basel Committee

• Why Does This Matter? While the banks with $100 billion to $250 billion in assets are not completely off the hook (and will be subjected to stress tests periodically), they will save millions in regulatory compliance costs linked with the stricter scrutiny.
Boost To Supplementary Leverage Ratio Figure of Custody Banks

• Current regulations require banks to leave out any deposits they have with central banks of developed nations (like the Fed and the ECB among others) while calculating their supplementary leverage ratio. Overall, this requirement has a negative impact on this key ratio figure. However, the new bill allows only the custody banks to include these deposits in their calculation of supplementary leverage ratio – resulting in an immediate boost to this figure

• Which Banks Are Affected? This change is a welcome one for BNY Mellon, State Street and Northern Trust. Despite being the third- and fourth-largest custody banks in the world, JPMorgan and Citigroup will not benefit from this change because of their diversified business models (with significant investment banking exposure).

• Why Does This Matter? BNY Mellon and State Street have regularly fared among the best at the Fed’s annual stress tests in terms of impact of a severely adverse economic conditions on their profits and capital ratio figures. As their capital ratio figures are already very strong, the relaxed leverage ratio requirements should free up considerable amount of cash for these custody banks – allowing them to return a sizable chunk to shareholders through dividends and share repurchases in the near future.
Change In Treatment Of Certain Municipal Obligations
Recommended by Forbes

Grads of LifeVoice: The Rewards Of Inclusive Innovation
• The current classification of securities held by banks does not allow U.S. Municipal Securities to be included as a part of high-quality liquid assets. The bill makes these securities admissible as a level 2B liquid asset (which can be included as a part of the Tier 2 capital ratio figure, with a haircut of 25-50%) provided they are investment grade and are marketable.

• Which Banks Are Affected? As all banks hold some proportion of municipal securities, this move is likely to have a positive (albeit small) impact on all U.S. banks

• Why Does This Matter? Banks with a sizable portfolio of eligible U.S. municipal securities on their balance sheets should be able to report a small uptick in their capital ratio figures thanks to this amendment. Clearly, the positive impact will be more for banks with a larger proportion of these securities.

These charts were made using our interactive dashboard platform, which is used by CFOs and Finance teams, private equity professionals and more to build interactive models and create, share and present scenario analyses.

Original article with original foot notes is here.

Image not mine, source not known. From internet

USPAP Compliance and Desktop Appraisals

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Many appraisers are worried that a so-called desktop appraisal will not be USPAP compliant if a third party to inspects and/or photographs the subject property.

USPAP does not make an issue of who inspects the property, nor who photographs it. USPAP does not require the appraiser to inspect the subject property. Nor does USPAP require the appraiser to photograph the subject property or the comparables. USPAP requires the appraiser to disclose the extent of the inspection of the subject property, which includes no inspection at all. Further, USPAP makes no mention of the need to include photographs of the subject as part of the formation of a credible value opinion. Both these requirements are a function of lender requirements, not USPAP.

Fannie Mae requires the appraiser to inspect the subject property, as well as to inspect the comparable property from at least the road in front of the it (assuming that’s possible). However, Fannie Mae has no requirements the appraiser take these photographs. In other words, a contractor the appraiser hires to take photographs could do this and the report would still be fully Fannie Mae, as well as USPAP, compliant.

An individual lender may require the appraiser to take the subject and comparable photographs him- or herself. If the appraiser agrees to this condition, then the appraiser has no choice but to do so. However, the key point here is that the appraiser personally taking the photographs of the subject and/or the comparables is a lender requirement, not a requirement of USPAP, and not necessarily a requirement of Fannie Mae.

Therefore, under certain conditions, an appraiser doing a desktop appraisal is perfectly USPAP compliant.  Providing photos is not significant appraisal assistance. The appraiser is under no ethical obligation to disclose the photographer’s name, nor the extent of his/her assistance.

Original Article Here

 

CONDUCT:

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CONDUCT:

An appraiser must perform assignments with impartiality, objectivity, and independence, and without accommodation of personal interests.

An appraiser:

• must not perform an assignment with bias;

• must not advocate the cause or interest of any party or issue;

• must not accept an assignment that includes the reporting of predetermined opinions and conclusions;

• must not misrepresent his or her role when providing valuation services that are outside of appraisal practice;11

• must not communicate assignment results with the intent to mislead or to defraud;

• must not use or communicate a report or assignment results known by the appraiser to be misleading or fraudulent;

• must not knowingly permit an employee or other person to communicate a report or assignment results that are misleading or fraudulent;

• must not use or rely on unsupported conclusions relating to characteristics such as race, color, religion, national origin, gender, marital status, familial status, age, receipt of public assistance income, handicap, or an unsupported conclusion that homogeneity of such characteristics is necessary to maximize value;

• must not engage in criminal conduct;

• must not willfully or knowingly violate the requirements of the RECORD KEEPING RULE; and

• must not perform an assignment in a grossly negligent manner.

Study: Lenders Need to Capitalize on Potential Home Equity Boom

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Article by: Mike Sorohan msorohan@mba.org

April 06, 2018

With the number of American consumers expected to take out a home equity line of credit projected to double to 10 million over the next five years, lenders need to improve digital offerings if they want to capitalize on the trend, said J.D. Power, Costa Mesa, Calif.

The company’s 2018 U.S. Home Equity Line of Credit Satisfaction Study said the digital experience is becoming increasingly critical to customer satisfaction. The study evaluated customer perceptions of the HELOC process and explored key variables that influence customer choice, satisfaction and loyalty based on six factors: offerings and terms; application/approval process; closing; interaction with the lender; billing and payment; and post-closing and usage.

The study ranked SunTrust Banks as highest in HELOC customer satisfaction, with a score of 869 on a 1,000-point scale, followed by BB&T (860) and Huntington National Bank (851). The industry average score was 837.

“Lenders need to recognize that the HELOC customer experience is a journey that begins with initial consideration and evaluation and extends through to usage, with each part of the journey affecting overall perceptions,” said Craig Martin, Senior Director of Financial Services with J.D. Power. “Increasingly, many steps in that process are occurring in digital and mobile channels, which are areas that the industry has been slow to leverage and refine. As Millennial homeownership rates increase and home values continue to rise, lenders need to be able to meet these customers where they want to be, not try to force them into the lender’s entrenched methods.”

Key findings of the study:

–Digital channels become critical for younger borrowers: Established relationships with lenders still play a key role in the HELOC customer journey, with 66% of all borrowers gathering information about a HELOC in person. However, digital is becoming a bigger factor among younger borrowers, with 59% of Millennials gathering information online via desktop computers and 50% of Millennials gathering information online via smartphones or tablets.

–Few HELOC borrowers say they are actively solicited: The majority (88%) of HELOC borrowers say they began the HELOC search without prompting from a lender, demonstrating that marketing efforts are not having much effect on customers. The group in the study least likely to hear from lenders are Millennials, 94% of whom initiated a HELOC product search themselves.

–Comparison shopping is the norm: More than half (55%) of customers indicate they considered at least one other lender during their shopping process. The comparison-shopping phenomenon is most pronounced amongst Millennials, of which 80% of HELOC borrowers considered at least one other lender.

–Concern is the rule, not the exception: Nearly two-thirds (64%) of all borrowers express some type of concern about obtaining a HELOC product, with Millennial customers showing the highest levels of concern. Only 13% say they had no concerns. Key concerns include the variable nature of the loan and overextending themselves.

The study is based on responses from more than 4,008 HELOC borrowers. (http://www.jdpower.com/resource/us-home-equity-line-credit-study.)

Original article here

One Real Appraisal and Six Ways to Support One Adjustment

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Full original article can be found hereAppraisers and real estate agents often ask what adjustments I use and/or how I support my adjustments.  The answer is that most properties require a different adjustment that is specific to its market (e.g. size, location, condition, etc.) and there are many different ways to support any individual adjustment.  No one method for supporting adjustments is perfect.  Appraisers should select the method or methods that will produce credible results for the given assignment and available data.

  1. Paired Sales – Paired sales are a cornerstone of textbook appraisals, but textbook cases of paired sales rarely occur in practice. In a common textbook scenario, paired sales are two sales that are the same in every way except the one factor for which the appraiser is trying to estimate an adjustment. For this reason, it is easy for appraisers to forget that a paired sale can have other differences (although it is important that the differences are minimal and that adjustments for the differences can be supported). In this assignment, my grid included four sales that had very little difference from one another except for GLA. After adjusting for a couple of minor factors, the paired sales all suggested an adjustment of $51 and $60 per square foot for GLA.
  2. Simple Linear Regression – I’ve blogged in the past about supporting adjustments, particularly GLA, using simple linear regression. Linear regression is basically analyzing trends in data.  For this assignment, simple linear regression suggests $53 per square foot when comparing sales price to GLA. Significant variation exists among the data of this sample, but the datum points are spread evenly along the entire regression line suggesting that the indicator is not being skewed by a small subset of outliers. It is okay if the properties in the sample have differences, however it is important to make sure to filter out differences that would skew toward one end of the range or the other. For example, if a larger site size also tends to include a larger home, then it would be important to make sure that the homes in the sample all have similar site sizes or the adjustment could be falsely overstated. Also, it is helpful to the outcome of the regression analysis that the subject property is in similar condition to the majority of the sales in the sample. The following chart shows the linear regression outcome in this appraisal.Simple Linear Regression Support Adjustment
  3. Grouped Data Analysis – This method is closely related to simple linear regression and is essentially many paired sales representing a fast way to estimate an adjustment simply by sorting comparable sales. This can be done using quick searches on the local multiple listing service or using data exported to a spreadsheet. But remember that the same factors that can skew linear regression will also skew grouped data analysis. For best results, it is important to sort out all of the features that might distort the results without sorting to the point where the sample sizes are small and wildly varied. For this assignment, I filtered out all ranch sales in the past two years with a lot size of 7,000 to 9,999 square feet, that feature two baths and three bedrooms, and that were built within ten years of the subject. Sales of homes meeting these criteria between 1,000 and 1,199 square feet have an average of 1,128 square feet and an average sale price of $212,637. Sales of homes meeting these criteria between 1,200 square feet and 1,299 square feet have an average of 1,253 square feet and an average sale price of $220,055. The difference between the average of these two sets is $7,418 and 125 square feet or $59 per square foot. The median could also be compared as well to provide another indicator that is less likely to be skewed by outliers.
  4. Depreciated Cost – The cost approach value in this assignment is consistent with values suggested by recent comparable sales. This suggests that the cost approach is likely valid and could be used as a way to test reasonableness or support adjustments. The subject’s original cost is estimated at $108 per square foot and the depreciated cost is estimated at $81 per square foot. A simple depreciated cost adjustment might not be a good adjustment to apply to comparable sales. This is because the depreciated cost is a straight-line measure from zero square feet all the way to the total area including the kitchen, bath, mechanical, and everything else in the house. For this adjustment, we are just looking for the value difference from a similar-sized comparable to the subject. To obtain this adjustment using the cost approach, I ran a cost estimate for the smallest comparable sale and another cost estimate for the largest comparable sale with no physical changes for anything other than living area (e.g. room count, garage, quality, and all other factors kept equal). The original cost difference between the low and the high came out to $79.53 per square foot. If this number is depreciated based on the cost approach in the appraisal, a reasonable adjustment of $60 per square foot of GLA is estimated.
  5. Income Approach – The income approach was not performed for this appraisal assignment, but if it had been, the income approach could have been used to support another indicator for the GLA adjustment. One way the income approach could be used to support a GLA adjustment is by taking the estimated loss or gain in rent from an additional square foot of living area (can be estimated using any of the above approaches except for cost) and apply a Gross Rent Multiplier (GRM). Critical to this approach is that the multiplier and rent estimates are market derived and that rent might be a consideration for the typical buyer.
  6. Sensitivity Analysis – This method is closely related to paired sales and I think it works best for secondary or tertiary support for an adjustment or helping to reconcile what adjustment is most effective. However, this method is not very useful if adjustments for other comparable sale differences are not accurate. Once all of the comparable sales have been placed side-by-side in a comparison grid and adjusted for all other factors using market derived adjustments, the appraiser can test different GLA adjustments to see what adjustment produces the tightest range of adjusted value indicators. If the appraiser is unsure by simply looking at the data, the Coefficient of Variation (CV) can be applied to each set of adjusted indicators to mathematically test what adjustment is producing the tightest range. The lower the CV, the better the adjustment is working within this sample of sales. Here is a link to a free CV calculator. Just enter your adjusted indicators separated by commas and press calculate. Then test another adjustment and repeat with the calculator. An appraiser could also set up a formula using the Worksheet function in a la mode Total to instantly provide the Coefficient of Variation. For this appraisal, sensitivity analysis helped me reconcile that the simple linear regression adjustment is most well-supported adjustment because it has the lowest CV as seen in the following table.

Paired Sales

Simple Linear Regression

Grouped Data

Depreciated Cost
Indicated GLA Adjustment

$51 or $60

$53

$59

$60
CV

0.00648 or 0.0082

0.00538

0.00734

\0.0082

None of the above methods for supporting an adjustment are without limitations and there are many more ways an appraiser could support an adjustment.  Although this is an example where data sets are particularly plentiful, the example shows that information does exist outside of textbooks for supporting adjustments; and when multiple approaches are combined and reconciled, a strong case for the appraiser’s conclusion can be made.  An appraiser won’t always need to go this far to support one adjustment, but if that one adjustment is crucial to the outcome of the appraisal or the appraiser believes they will be challenged on this adjustment, then the appraiser should expand and explore multiple methods for support.

By Gary F. Kristensen, SRA, IFA, AGA

Full original article can be found here

Tenant’s responsibilities/Landlord’s rights

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Note: These lists are not ALL of the rights and responsibilities of landlord and tenant.

What are some rights and responsibilities of the landlord and tenant?

Tenant’s responsibilities/Landlord’s rights:

    • Pay the rent on time.

Must be paid by midnight on the ninth day after the day it is due, or the landlord may start legal proceedings to evict the tenant.

  • Keep the apartment and the surrounding area clean and in good condition.
  • Keep noise to a level that will not disturb your neighbors.
  • Repair any damage occurring to the apartment through the fault of the tenant, family members or guests. Notify landlord at once of major damage.
  • Give the landlord permission to enter the apartment at reasonable times and with advance notice to inspect it or to make any necessary repairs.
  • Notify the landlord of any anticipated prolonged absence from the apartment so he or she can keep an eye on things.
  • When moving out, give landlord proper advance notice. Be sure that the apartment is in the same condition as when the tenant moved in and return the key to the landlord promptly.
  • Notify the landlord immediately if the apartment needs repair through no fault of the tenant.
  • For further information view the publication Rights and Responsibilities of Landlords and Tenants, JDP-HM-31 or (en español JDP-HM-31S)

Landlord’s responsibilities/Tenant’s rights:

  • A clean apartment when the tenant moves in;
  • Clean common areas (hallways, stairs, yards, entryways);
  • Well lit hallways and entryways; and,
  • Properly working plumbing and heating (both hot and cold running water).

Original Source

Will the home appraisal industry be replaced by technology?

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Automation haunts many discussions about the future of work, employment, and the economy. But technological advances may soon hit homes in an unexpected way: could real estate appraisers be replaced by robots?

That’s the conclusion of a recent article in Bloomberg, which discusses how advances in big data and computing are helping automate this knowledge-based job, perhaps a harbinger of how advances in machine learning mean an ever-widening circle of professions are at risk.

The future of the profession has become a topic due to a recent decision by Fannie Mae and Freddie Mac, two institutions that facilitate the flow of funding for home loans nationwide. In the past, both of these entities have occasionally allowed appraisal waivers when evaluating low-cost loans. But recently, they’ve changed their stance, starting up a program earlier this year that would waive 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. In June, Freddie Mac said it would start accepting automated valuations for some refinancing loans.

This decision will reduce the number of appraisals being requested, says Appraisal Institute President Jim Amorin, and implicitly suggests that a model with less human participation is just as good.

 

“There’s no replacement for an appraisal in most cases,” Amorin tells Curbed. “Many of the computer models use public information that hasn’t been verified. Even Zillow will tell you it’s an estimate, not an appraisal.”

A profession already feeling pressure

These policy shifts come during an unfortunate time for a profession watching its workforce slowly shrink. Today, there are currently 78,000 licensed appraisers in the U.S., says Amorin, whose organization represents roughly 20,000 of them. That is a steep drop from the 120,000 that performed the job five years ago.

Part of the decline is due to appraisers requiring extensive training and apprenticeships to become licensed, and part is due to diminishing fees, a result of the growth of appraisal management companies that work with lenders and take a portion of the final fee. The median age of an appraiser is roughly 52-55, says Amorin, suggesting the workforce is aging, retiring, and not being replenished.

“If numbers continue the way they are, there may not be enough appraisers to meet the needs of the marketplace,” says Amorin. “We worry about how the automated models will serve the needs of consumers.”

Computer estimates are closing the gap

At the same time, the technology now being cast as competition for appraisers is getting better and better. According to a Zillow engineer, the company’s Zestimate tool uses algorothms, machine learning, public records, MLS data, and information from brokers and users to create increasingly accurate value estimates. The models are continuously being trained on a daily basis to become more sophisticated; some are examining external imagesto better determine the “curb appeal” of a home Zillow even launched a $1 million Zillow Prize in May, similar to the Netflix Prize, to entice data scientists and researchers to improve the company’s algorithm and devise a more accurate method of estimating home values.

Zillow representatives noted multiple times they believe appraisals are valuable and in no way seek to replace the need for an appraisal.

Amorin believes that automated appraisals still focus too heavily on public data and often miss the little details and true picture of a property that creates an accurate value estimate. He believes you get what you pay for with automated models, and the work of an impartial appraiser is key to a functioning, transparent market.

But that doesn’t make him anti-technology. Amorin believes the future is in a marriage of man and machine, where humans and computer models combine for more accurate estimates. Appraisers get data that saves them time, while their estimates can be fed back into the algorithms and machine learning systems to make the estimates more accurate.

“If appraisers believe they can move forward doing what they’ve always done, they’ll go the way of the one-hour photo shop,” he says. “We have to adapt.”

By Patrick Sisson

Original article is here

12 amazing content marketing ideas — no blogging allowed

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These tips will get you out of your blogging rut

Original Post by Ben Janke

Style icon and fashion designer Vivienne Westwood once said that your life would be more interesting if you wore impressive clothes.

You can apply that principle to content marketing — your brand will be more attractive if you can create impressive content.

Don’t get me wrong; real estate blogging is great and can help you brand your business, but there are other ways to create valuable, shareable content.

To ensure that your content stands out from all of the standard formatted, dry blog posts on the Web, why not use a different approach? Frame your content in a new way.

There are many different ways that you can differentiate the message of your brand and engage with your local prospects. We have compiled 12 of the most creative media formats below.

1. Frame the content in the form of a quiz.

Why not create some shareable content in the form of a viral quiz? It’s a great way to segment your audience and create a viral buzz focused on you and your website.

Check out sites such as Qzzr.com and TryInteract.com for ideas on quizzes you can deploy in your market. It doesn’t have to be real estate-related all the time. You can create quizzes about your local area or city and target local homeowners in your city with a Facebook ad.

2. Hold a Q&A on Twitter.

Tweeting isn’t all about one-offs. You can release a block of questions and answers on Twitter and interact with people in your city. Later, you can repurpose that content into a curated blog post.

3. Ask a “yes or no question” in a text.

If you want a customer to give you a straight answer, then ask them a straight question. It is easy to get a simple response via a text message by using SMS applications. This type of content drives not only readership but also engagement.

4. Instead of thinking website, think document.

Go bigger by offering downloadable content. A discrete document, such as an e-book, white paper or PDF frequently is perceived to have a higher value. This tactic is great to create as a lead magnet for a landing page.

GO BIGGER BY OFEERING DOWNLOADABLE CONTENT – AN E-BOOK, WHITE PAPER OT PDF

. Use infographics and charts.

Infographics and charts are a great way to map out the data of your local real estate market. You can use sites such as infogr.am and Piktochart to create highly engaging images. Be sure to add your logo to the image — infographics can be great content that people love to share.

6. Review a recent case study.

Do you have a product that you need to present? Focus in on imagining how it was used by one ideal buyer or seller client to solve their problem. When you can be specific, it frequently has general appeal and helps with encouraging people to purchase work with you.

7. Set it up like a comic strip.

Everybody loves comics. If you can say what you need to in the form of snappy one-liners, you can always present them with sequential panels, stick figures and bright colors. Bitstrips can help you get started.

INMAN, NANA SMITH, REALTOR, APPRAISER, STAMFORD CT

8. Use a shared space to place content.

Scrapbook sites such as Pinterest are excellent for pulling together related content and having it all in one place. Take lots of pictures as you tour and list homes, and build a significant following. You can also start a conversation in Reddit.

SCARBOOK SITES LIKE PINTERST ARE EXCELLENT FOR PULLING RELATED CONTET IN ONE PLACE.

9. Consider video marketing

Video is taking off and will continue to grow. You can easily shoot video content when you are out in the real estate field. You can also record on-screen presentation on tools such as ScreenFlow and Camtasia.

10. Interview an expert and do a podcast

Craft your content in the form of questions that your audience might ask, along with answers provided by an expert. Maybe you are the expert, or you can collaborate with a lender, home inspector or another agent on your team. You can even turn this interview-style content into a real estate podcast.

11. Write a glossary or FAQ

It isn’t just great for SEO. Reference pages such as glossaries are a type of evergreen content that will get the attention of real estate buyers and sellers now and years from now.

REFERNACE PAGES WILL GET THE ATTENTION OF REAL ESTATE BUYRS AND SELLERS NOW AND FOR YEARS.

Think of frequently asked questions, and start building a database of answers. What are the average days on the market? How long is the escrow period? What are the average closing costs?

12. Keep an eye out for more unusual content opportunities

Captions, ALT text, rollover text — these forms of microcontent can all be customized and add interest to your content. It will not only optimize your website — it will also make you appear very knowledgeable about your material.

Those are 12 real estate content ideas. You can find even more by just thinking about what attracts you eye when you’re reading content. Is it color, captions, sidebars, audio or video? They all provide you with clues for the next content marketing project you do that isn’t just a simple blog post.