A Possible Solution to Customary & Reasonable Fees
Over the past five years, a major subject of talk in the appraiser world has been that of Customary and Reasonable Fees. Unfortunately, much of the dialogue has been mostly one-sided. We tend to do a lot of griping about the fact that many of us are not being paid what is “customary” or “reasonable”, but there are very few solutions offered up.
When I was young and would sometimes (not often, of course) complain about this or that, my father would always say, “Don’t come to me with a complaint unless you have a possible solution.” It was sound advice then (though I did not appreciate it at the time), and it is still good advice today. Though it may not be completely up to us what happens in the world of appraisal regulation and enforcement, it is clear there is a problem. It is also clear there are very few voices offering up potential solutions. One of the thought-leaders of our day in the appraisal world is that of Mike Ford. Mike is a forward-thinking appraiser who aligns with me on many principles of finance. We both agree that the best, most perfect solution to our current problems is the old “Invisible Hand” of the free market. However, we are not blind to the fact that we are far enough down the rabbit-hole with over-regulation at this point that it is simply not pragmatic to believe that we can just wave a magical economy wand and expect all of our problems to be solved through the thinking of Adam Smith. We have to work within the system we currently have (while simultaneously nudging the system itself in the right direction).
Mike recently wrote two blog-posts about the gravity of our C&R situation and (Hallelujah and Praise Be) actually offers up some possible solutions. These articles can be found (and should be read) here:
Though Mike will freely admit that the solutions offered are not perfect, they are at least a starting point (and that is a heck-of-a-lot more than most of us are doing). I sat down with Mr. Ford recently to discuss these two articles, why we find ourselves in this current C&R crisis, and where he sees the profession going from here. You can listen to my interview with Mike on both iTunes (Apple) and Stitcher Radio (Andriod) or even at your desktop. Just click the appropriate link below, find Episode 061, and join the conversation. While you are at it, subscribe the the podcast and listen twice a week while we discuss the ins and outs of the appraisal world.