Palumbo On USPAP is written by Joe Palumbo, SRA, a long time appraisal colleague and friend who is also an Appraisal Qualifications Board (AQB) certified instructor and a user of appraisal services. Joe is well-versed on the ever changing landscape of the Uniform Standards of Professional Appraisal Practice [USPAP].
Spring is nearly here, but as more people venture outside, Joe cautions against mob rules: doing things ’cause “everyone does it.” …Jonathan Miller
It must be the “economic climate” that has me a feeling as (blah) as I am. It has to beafter all we did not have a harsh winter here in the NE, although one wonders if the perpetual rains can not fall into that category.
As I prepared to teach my first USPAP class of the spring, I was surprised and pleased to see how “robust” the material is for the 2008-2009 class. Discussion problems, focus on “real-world” issues and clarification on some of those “confusing” everyday issues. this material has it all. Everything from a what is a Federally Related Transaction to Confidentiality.
Still, I wonder if bi-annual mandated 7-hour detention was enough for the masses. To me not knowing the basics of USPAP as an appraiser is like trying to become a doctor and not understanding the skeletal system.
I know.I knowthere ARE some hair splits and some confusing topics in real estate appraisal as it relates to ethical, acceptable or just plain bad practice. The thing that gets me is that no one will argue those points but they will the basics.
Case in pointspeaking of Confidentiality. I friend mine was asked about providing work samples to a potential new client. I told him “make your life easier”. Get permission to use them and put a cover letter stating such permission was granted”. If you do not get permission then you will have to redact the confidential info that is identified by the client (likely the subject) AND the assignments results. Well, in this day and age if you send me the “sample” and redact your FINAL valueI have no use for that sample. Reconciliation is key these days.
Ok more to the pointon what my friend told me happened when the “lender” called to ask for status on the samples. “Well”, he said, ” I need to get permission to use the samples and that may take some time”. “No”, “No”.. stated the lender “just send them alongyou do not need that.EVERYONE just sends them in”, “never redaction..”.
Yepeveryone just does this or thatmaybe it is just ignorance or sending out work samples is no big deal.
There is a much bigger picture here: the guy or gal sending those samples is the same guy who makes the deal, misses the sale next door or the expired listing on the subject cause that is the way he/she thinks.
Professionalism is a way of conduct..not a cap rate with sound data.
It reminds me of when I was in a sales office once and I asked for the typical absorption information. “We never get those questions asked”? “What kind of appraiser are you?” The saleswoman quipped. So I respondedlike my financial advisor”If you do not give me all the info I need to analyze this situation I will give the lender a half good appraisal” (or half- good advice).
Make the most of your 7-hours this licensing cycleeven if all you get is just the basics…….
IS IT SPRING YET?!
Tags: Soapbox Blog, Absorption, USPAP, Palumbo on USPAP
I have had prospective clients tell me that the work samples needed all the information on the subject and sales just in case they wish to confirm the data included in the sample. I have typically informed them that some of the information is confidential and that the “names have been changed to protect …” those that do not want this information disseminated.
Of course, the prospective client wants all the information and cannot understand why I would seek to preserve the previous client’s confidentiality.
Also, in regards to absorption, escalation clauses, expense ratios, NOI, cap rates, or anything else relevant, the sales person, property manager, or other party to the deal seems to think that this information is irrelevant or just none of the appraiser’s business. I think that one major change that is necessary going forward is the education of the market participants as to what the appraiser is required to have. Perhaps attorneys, property managers, accountants, agents, brokers, underwriters, and investors should be required to take a course identifying all the things that they need to supply to the appraiser when he/she requests this information.
Who do we write to?