Customary but NOT Reasonable Fees
REASONABLE needs to become the appraiser’s operative word
It’s time to grow a pair as some people say, or to stiffen the backbone, and quit caving in to the low ball fees being offered by some in this crazy “industry.”
Another true statement is “you are what you are worth”.
If you, as an business person, only know how to say yes to low fees, you won’t be worth anything higher to the majority of clients. Further, your self image and actual net worth are negatively impacted. You cannot expect to earn a certain income, then wonder why you gave yourself a bloodbath by working for peanuts. You cannot sell at a loss, expecting to make up the difference in volume.
The subject of C & R fees, as mentioned in the Dodd-Frank law, was intended to protect the local appraiser. That concept was diminished and watered down by the Federal Reserve Board when they issued their Interim Final Rule to implement D-F into the main stream. As a result, appraisers have been taken advantage of by less than honorable clients, and unfortunately, far too many appraisers have succumbed to this nonsense.
It may be ‘customary’ to accept low fees, but it certainly is NOT reasonable.
REASONABLE needs to become the appraiser’s operative word, the operative attitude, and the operative action whenever you are asked to quote a fee for a particular assignment. To quote the same ‘customary’ fee for all types of assignments, regardless of difficulty, is suicide.
Case in point: I was recently asked to be the second appraiser for a non-commercial ‘horse property.’ This property is 20 acres, with house, stable, riding arena, paddocks, barn, etc., all necessary to support the equestrian use. The first appraiser quoted a fee similar to what might be offered for a simple house in a subdivision. My quoted fee was $150 higher. And even that might not be high enough! But this certainly is not a ‘customary’ assignment worthy of a low ball ‘customary’ fee.
To consider what might be REASONABLE in your area, click this link for the WorkingRE fee survey. This gives you a good foundation for what your lowest fee should be for the basic type of assignments.
You are a professional. Reasonable should be the way you charge for your service.
‘Customary’ is just a disguise for low-balling. To heck with that!