Competition & Joe Above-Average

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Competition & Joe Above-Average

The appraisal profession is in competition with other professions

Ask any appraiser nowadays, and they can give you numerous details and opinions about why things are a mess and why appraisers are leaving this profession in droves. In a previous story, it was reported that Illinois alone lost somewhere near 900 appraisers last renewal. Every appraiser already knows about the fee problem, insane liability, higher costs, ridiculous revision requests, and the list goes on. All those reasons are the finer details. I would like to add a different perspective and paint a bigger picture as to why I think appraisers are leaving this profession. And it’s a reason we don’t often hear or probably think about.

Competition.

Competition is defined as

“is a contest between two or more organisms, animals, individuals, groups, etc., for territory, a niche, for a location of resources, for resources and goods, for mates, for prestige, for recognition, for awards, for group or social status, or for leadership.”

Competition is a contest between two parties for something.

Competition is not something we really think about, but it’s everywhere.  Everyone is always competing for something in any business or occupation. People can be found competing every day, whether it be in a work place or on a race track somewhere. Appraisers, own and operate their own businesses, and are always in competition against other appraisers for work. Competition makes appraisers strive to do better in all their reports. Competition makes appraisers strive to make their customers happy. Competition makes appraisers do everything better. Competition makes all businesses strive to do better every day. Competition is what makes businesses grow and excel.

Competition can also be found in the workplace, whether it be one employee against another employee. Or it could be one company competing against another company to hire or keep the best employees. We often see companies who want the best employees, offer those employees sign-on bonuses or large salaries. Sometimes those employees will be given a bigger or a better office, a company car, stock options, etc..

I believe that one of the many reasons that appraisers are leaving the profession right now is competition. “Huh?” you say? Look at it this way. Picture in your mind a job fair in your area. It’s a small job fair, consisting of only two vendors. One vendor is an appraiser/recruiter. The other table is almost everything else. Joe Above-Average walks in the door. He goes to both tables to hear their sales pitches about why Joe Above-Average should work for them.

If both recruiters are completely honest with Joe, Joe Above-Average is probably not going to accept a position as an appraiser, is he? Joe Above-Average is going to find out that being a self-employed appraiser nowadays will consist of things like absurd education and training requirements, crazy liability, very low pay especially during the training years, long hours, no benefits or pension, no company car, no stock options, no sign-on bonus, controlled fees, classes and licensing costs way over and above most everything else, over-zealous regulatory boards constantly threatening costly lawsuits, USPAP, no room for advancement, etc., etc..

Joe Above-Average at the other table however, depending on the job, is going to find out that being just about anything else, could consist of things like a pension, benefits such as life or health insurance, none of all the appraiser nonsense mentioned above, advancement possibilities, raises, weekends and evenings all to himself, no liability, no licensing or regulatory boards to deal with, etc., etc..

What will Joe Above-Average do? In today’s environment, I don’t think its a tough decision at all.  And I think we all KNOW what he will do.

Because so many employers are looking for good, experienced and mature employees, the appraisal profession, in competition with hundreds if not thousands of other professions, will always LOSE the contest to draw in and keep good people. Until everyone inside and outside of the ENTIRE appraisal profession realizes the appraisal profession is in serious trouble, realizes that the profession is in competition with other professions, makes significant CHANGES, makes changes that will draw in and keep the best people, the appraisal profession will continue to lose good people to most other professions all day long.

A big problem with the new four-year college degree requirement for appraisers is, it instantly made drawing in and keeping good people even harder and the appraisal profession even less competitive. Because those people will have even more choices and better opportunities than those who don’t have a four-year degree.

I am not saying that we need to find a way to give appraisers sign-on bonuses or a company car, or stock options, etc. What I am saying is, our leaders need to take a SERIOUS look at taking the profession in an entirely different direction than where it is going now. They need to find ways to make the appraisal profession much more competitive and attractive to everyone, new or old. The entire industry can no longer afford to be lazy in its old habits. It has to be more proactive than it ever has been before if it wants to draw in and keep good people. In my opinion, the best place to start is solving the C&R fee problem. Current appraisal fees stuck in the year 1995 is a huge problem. Deciding to make less pay with all the nonsense vs. making more pay with less nonsense and benefits, is a no-brainer decision for anyone.

If the goal is for the appraisal profession to survive, then the entire mindset of our leaders, and the current path that the profession is going on, HAS TO CHANGE. And it has to change FAST.

the bleeding continues…

By Bubba Jay more recently known as Bubba Jay / Retired Appraiser II

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16 Responses

  1. Retired Appraiser Retired Appraiser says:

    Everything comes down to appraisal leadership; a group that is so insulated from reality that they may as well live on Pluto. When was the last time that you heard the Appraisal Foundation or the Appraisal Institute or even your own State Appraisal Board discuss Reasonable Compensation, HUD-1 Transparency, or the current extortion based business model for ordering appraisals? WHEN? They likely issued a statement on these topics 5 years ago because it was fashionable.

    How do they live in a separate world and continue to call themselves your leaders? First off they have no clue what type of pain you endure on a daily basis. The handful that still appraise for a living have complex business models with multiple streams of income. Others are wealthy from inheritance. Still others live off of the generosity of their spouses. They bury their heads in the sand when it comes down to it because it’s easier. They convince themselves that the typical residential appraiser is simply a lazy person who refuses to reinvent his business by relying on tax valuations or legal work.

    Your leaders would rather walk around the planet without shoes than acknowledge the fact that it is THEIR RESPONSIBILITY to lead appraisers in the fight to reclaim their profession. They justify their actions by saying, “I’m just a person…what can I do to help when we’re fighting the banking lobby”?

    Your current leadership suffers from: Absolute Apathy And A Complete Lack Of Creative Intelligence. Is there a clause in their contract that would allow you to impeach each of them? For years appraisers have discussed the option of suing AMCs, suing the banking lobby, suing whomever, etc.

    Here is a novel thought that you’ve never considered: File a lawsuit against your own leadership for fraud, negligence, or incompetence. Let them explain in a court of law precisely why they have failed to organize appraisers in a fight to reclaim the profession. Just be prepared for 75 semi truck loads of evidence (those pretty letters they’ve been writing on your behalf or the multitude of studies they’ve blown millions on since 2009).

    OPTION 1: Steve Jobs & George Costanza
    In the words of Apple, Inc. “THINK DIFFERENT”. Thinking differently took Apple from the brink of bankruptcy in 1997 to becoming the most successful corporation on the planet within a few short years.

    OPTION 2: Henry Ford
    “If you always do what you’ve always done, you’ll always get what you’ve always gotten”. This is the preferred method of your current appraiser leaders. They remain oblivious to the fact that your profession is accelerating towards the black hole at the center of the banking galaxy.

    HINT
    30,000+ appraisers have quit the business for good reason since 2009 (and it wasn’t because of retirement). They became disgusted with your leadership (or lack thereof) and they quit the “profession”.

    If you are too lazy to rise up and boycott AMCs at least go to the effort of suing your own leadership appraisers.

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    • Retired Appraiser Retired Appraiser says:

      How did Apple go from the brink of bankruptcy to becoming the most successful corporation on earth?

      They shi(p) canned 3 consecutive CEOs: John Sculley, Michael Spindler, & Gil Amelio before locating a leader with a shred of insight into why the ship was sinking. There is a clue in there for appraisers if only you will take note.  It is glaringly obvious that your current leaders have no clue about the current state of the appraisal “profession”.  Either fire them or take matters into your own hands (boycott AMCs); otherwise you will have the privilege of watching your leaders climb into their lifeboats while their ship of fools sinks beneath the waves.

      Make no mistake; your “profession” is on a death cruise with the end result being as predictable as the setting sun. The only thing that can alter the outcome is the action of the individual appraiser. For those of you who missed it…the starting gun sounded 7 years ago.

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  2. Retired Appraiser Retired Appraiser says:

    From 2009 to 2016 your leaders have remained clueless as to why your profession is sinking. It doesn’t take a genius to see where the problems lie but it would require them to pull their heads from their @$$es long enough to survey the battlefield. It should be obvious to all by now that their never ending discussions and pretty prose didn’t cut it.

    Your leaders have failed you at every turn; perhaps they will now accept advice from George Costanza on winning.

    Those who remain active in this business should consider sending their appraiser leaders:

    *A toy periscope
    *A copy of the George Costanza video
    *A copy of the following note

    “For seven long years you have been unwilling to pull your head out of your ask to view the current state of affairs with regard to our profession; or to be more blunt: the massacre of our profession. You may find the enclosed periscope to be beneficial should you wish to remain in your current position as a leader. If after using this device you still find it impossible to grasp the gravity of our situation, please review the enclosed video for advice. The video was written by a 3rd grade student to insure that the basic concept will not be lost on any our industry’s state or national leaders”.

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  3. bubba jay / Retired Appraiser II bubba jay / Retired Appraiser II says:

    comments to articles dont get any better than THAT, RA.

    i stand and applaud YOU, this time sir.

     

    the bleeding continues . . . . .

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  4. Big Charlie says:

    These articles are getting old, it’s the same “the bleeding continues” bs that seems to be posted over and over by the same 2-3 people. We all know what issues exist. I think it is time to realize this is the sign of the times. Appraisal fees won’t go up, and when we continue to bitch about it, big data will step in. While I do believe data will never be as good as eyes on the site, it will be good enough for most normal transactions. I think the appraiser will continue to exist in a smaller role doing high end properties, rare case properties and then simple verification of property size and features when in question. The appraiser fee because of this will actually go down, but the appraiser will have more jobs that take less time to complete with plenty of demand as the average age of appraisers continue to rise and every year more retire and die. Like all careers you have a choice. The choice is simple, do I continue to do this job and bitch everyday or do I say no more and move on to something new, something different, something with more pay, something will less headache? If your answer is I will stay and continue to do this… well fantastic, but please stop complaining and stop accepting low bids.

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  5. Retired Appraiser Retired Appraiser says:

    You’re right about one thing, the articles continue and appear to be increasing in frequency with responses that are growing exponentially. The lives of today’s residential appraiser can only be described as a cross between the movie Ground Hog Day & Nightmare On Elm Street. A more appropriate title would be:

    “Night Of The Day Of The Dawn Of The Son Of The Bride Of The Return Of The Thing Called An AMC”.

    You did miss one option however: Quit the business and spend every day for the rest of your life encouraging appraisers to either leave for better paying careers or boycott AMCs.  I chose that option long ago Charles and I’ve steadfastly stuck by it for 7 years.

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    • Big Charlie says:

      I know many appraisers who don’t work with AMCs. There is a ton of non lender work out there that pays much more than AMC work. The problem is, initiative. It takes a strategy, planning and time. However, most appraisers stick to AMCs because it is the easy way to get work, work that is low paying. Work that you’ll complain about and say “the bleeding continues” about. End of the day you are accepting that work and that low pay that comes with it. So sure you can boycott AMCs and still appraise, just get out there and do it. Maybe then you’d stop complaining and find love for your career all over again. Or just stop complaining and find a different career already.

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  6. bubba jay / Retired Appraiser II bubba jay / Retired Appraiser II says:

    so to summarize, what some of you are saying is, appraisers should decide to take one of two positions.

    1. take a position of apathy, pretend everything is ok even though you know its not, dont discuss any of the problems appraisers face because it probably doesnt matter anyway, dont be willing to offer up any possible solutions, dont offer up any ideas in hopes of enlightening those without ideas, keep quiet, bend over, and take it up the “you know where”.

    or

    2. take a position of passion and care about the industry, attempt to inform those who could make a difference that everything is not ok, discuss the problems appraisers face every day in hopes that someone might be listening, think outside outside the box and offer ideas and try to help find solutions to the problems, discuss and find ideas or solutions that might not have been thought of, speak your mind, and say “hold on, wait one minute” when you disagree with something or see that something isnt working.

    sorry, but i am going with position #2.

    THE BLEEDING CONTINUES . . . . .

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    • Big Charlie says:

      OR #3, stop working with AMCs. Get paid more, be happy again. Look at those who continue to complain about AMCs, yet still decide to take their low bid and laugh. Change is scary and can be hard, but suck it up, grow some balls, make a change. Be happy again and stop saying “the bleeding continues” as the bleeding stops.

      Some people are just good at complaining without taking action, writing an article is not action, it is more endless complaints to the very audience who can’t institute change, resulting in no progress made. At least if you are going to complain, do it to the right audience; the banks, the elected officials who put AMCs in place. Let them know the system doesn’t work for the appraiser. Telling other appraisers what they already know is useless.

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      • Charlie, I get your point, but have to respectfully disagree. Telling (or sharing) concerns with other appraisers lets them know they are not alone. It CAN also be a way of helping them direct their concerns in more productive ways.

        IF all of us felt the same about all issues, then there would BE NO APPRAISAL problems because we’d have ALL followed RA’s original suggestion in the first two weeks after Cuomo foisted AMCs on us to begin with. Its too late for that old suggestion but there ARE other courses of positive action to be taken.

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    • ValleyGal says:

      Amen bubba! #2 for me too.

      I don’t work for AMCs, never have and never will, but because of AMCs, I had to lower my appraisal fees. I unlike BC who I think is also Big Charlie, appreciate the talk, the ideas, the fight, and your passion. Glad to have you in our corner!

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  7. BC says:

    I’m also sick of the same arguments, BOTTOM LINE if you don’t like AMC work, which I COULD NOT STAND, develop a client base which does not use them, this takes hustling and hard work but what career doesn’t? If you chose to work for AMC’s w/crappy $250 fees & 48 hr turn times that’s on you, but don’t turn around and WHINE!  That’s what my 3 yr old twins do! (although they will not be following me in this career!)

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    • Retired Appraiser Retired Appraiser says:

      Definition Of Insanity based on Big Charlie & BC’s logic:

      “It’s a lousy career to be sure and you won’t catch my twins in this business but I’m sticking with it”.

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  8. bubba jay / Retired Appraiser II bubba jay / Retired Appraiser II says:

    my tiny little statement about AMC fees was made as one possible solution to making the profession more competitive. yes we all know fees are a problem and yes it isnt new news. i believe its beneficial to talk about it, because without some kind of dialog, entities like VACP might never know that there is a problem that needs fixing, and any problems in the profession might never get fixed. (looking at the stats, its obvious that the so-called “leaders” are out of ideas and there are problems, wouldnt you agree?).

    i also agree that there are other sources of income for appraisers, but unfortunately for many appraisers, AMC work is all they have at the time to keep a roof over their heads and bread on their families table. everyone is happy with everything going on in every job? nobody hasnt ever disliked their job but works there anyway to pay the bills? i dont think so.

    the point of the article is to point out that the appraisal profession is in competition with other professions, now more than ever. if the profession wants to stop losing people or wants to attract new people, then the profession needs to be more competitive. the fee comment was an attempt to start the discussion rolling.

    getting back on track – how can we make our profession more competitive?

    discuss.

    sheesh . . .

    the inability to focus continues . . . . .

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  9. I loved the initial article! Though I respectfully disagree with several of the follow ups on both sides of the issue.

    Legitimate ‘complaints’ should never be referred to as whining by any professional in my opinion. To do so diminishes the importance of the concerns being addressed. RA/Bubba the initial article was one of the best I’ve ever seen you post-Overall great. Though agreed; with some reservations.

    Let me address one aspect of the “leaders” being ‘at fault’. I attended the Las Vegas Public Hearing of the TAF/APB on last Friday (no Appraisers Guild or member funds were used in any way for this).

    Lots of good information. Also, they reported that there really is a shortage of individual appraisers offering suggestions, complaints and concerns to them as a Board, or as individual members of the APB.

    Without exception each Board Member tasked with a specific issue ‘lead’ reiterated that they WANT and will READ EVERY single email or letter offering opinions; advice or concerns.

    One point that BOTH the TAF/APB Board Members and the Appraisal Subcommittee Executive Director made was to remind us that the squeaky wheel is still the one that gets the grease; meaning that the volume of complaints we have should be increased rather than diminished if we ever hope to remedy the issues of concern to us. Not only the concerns; but also our suggestions for resolutions! C&R continues to fall into this category.

    Along these lines: Jim Park, Executive Director of the Appraisal Subcommittee; Federal Financial Institutions Examination Council; Jim@asc.gov (202) 595-7575; 1401 H Street, NW, Suite 760, Washington DC 20005 extended a personal invitation to appraisers. IF you do not know WHERE to file a complaint about an appraisal concern; AMC issue, Lender issue, etc. send it to him. He & ASC do not process or investigate them, but he promised he WILL see that you are given enough information to get it to the right people.

    Similarly, EACH APB special committee member extended an invitation to contact them on ANY issue that you feel is a (practices) concern; or with a suggestion for new topics for the APB, OR solutions to currently identified problems or topics. That includes solutions to perceived appraiser shortages. (1) Reduce experience required; (2) Reduce formal education required OR investigate work experience-to-education credit programs? (3) While no one other than me suggested it, even eliminating the four year degree requirement completely;(4) Finding a way to grandfather those licensed appraisers with 10 or 15 years experience looking to upgrade that do NOT HAVE 4 year degrees (THAT ONE WAS postulated by a Board Member!).

    I don’t want to try to deal with the Green Agenda here. Just too lengthy, but a couple other areas that ARE going to be addressed and for which YOUR input IS needed are:

    (1) Collection and verification of residential data used in 1-4 unit sales comparison;

    (2) Collection and verification of data used in sales comparison for non residential properties.

    Do you think APB NEEDs to address this? If so, how? WHAT are YOUR concerns? More info required? More leeway in reporting or verifying data? Unrealistic regulatory expectations in this area? Need to work more closely with other disciplines to improve data (NAR or State Realtor organizations?), Unrealistic client expectations? Recognize that data availability varies from region to region so if there is a particular problem with data in your area; what is it and how can it be improved?

    Understand too that the TAF and it’s Boards are also aware that political influences play a part in what goes on in our regulatory system. IF it is our elected leaders that RA is talking about suing I have a better idea. Vote them out on their asses!

    If it is the volunteers, then the question is WHY? and for WHAT specifically? VaCAP’s leaders just found out that their own state would not back them up in doing “the right thing” with Coester, so how or why would we hold the volunteer Board Members there accountable? The same could apply to LREAC. They WON their cases, but only got a wrist slap penalty imposed; thanks to giant loopholes in FIRREA; Dodd Frank and possibly their own state laws. Not to mention REVAA; or a purported “independent” confirmation source that Flagstar’s C&R methods producing $200 to $250 results were realistic.

    There are things we all need to do to save our profession, but blindly suing those who ARE our leaders just because they too have their hands tied, is not one of them. Imho.

    Things you CAN do?

    1. Join your state’s appraisal coalition & become more informed.

    2. Join an established National Appraisers Advocacy Group focused on solving our problems. I strongly suggest the American Guild of Appraisers. http://www.appraisersguild.org or (301) 220-4100 or email jbellas@appraisersguild.org . Lets look for NATIONAL solutions that benefit ALL of us!

    3. Join the National Association of Realtors(r) as appraisers. We need to built a bridge between ourselves and the nations largest issue advocacy group!

    If you do not now see a need to get involved, then BC is right in principle. You are ASKING others to set the rules you earn your living by for you. So far the results of ‘other people’s’ lobbies have not had OUR best interests in mind.

    Were you even aware that one Board Member (Business Valuator) is home based in Mexico City? Do you care? Has TAF /ASB / APB lost sight of its/their original purpose for existing, or is this a logical outgrowth? Are the needs of one discipline in the field of “appraisal” or “valuation” now dictating the needs and standards of the real property appraisers to the detriment of OUR discipline?

    BTW-Both the TAF Board of Trustees, AND the APB expect three openings in the upcoming year. These positions are filled by regular people, just like you and I. I hope that EVERY person that reads this will apply for one of these positions.

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  10. TOM D says:

    i think our movie title should be “de old appraiser on de plantation”.  bubba, you are getting it right, it’s the MONEY.  the amc’s have free trade to make get more business, to make more money, by offering their services for less.  it don’t come out out of their fee, does it.  their incentive is to be the lowest charging amc to get all the buisness.  we lost that option of “free market”.  mike, i am stunned that how these boards are acting stupid about what everyone has known since hvcc started.  they all know, they don’t care.  i also agree, mike, that “individually” we are all dead, and don’t know it.

    part of the problem may be the age of us as a group.  also, the ai was to represent appraisers.  but never once, even in the past, have they talked about fees.  their only concern was appraisers being considered as reputable.  since i was a member of the society before them, has that ai thought process changed the perceptions of appraiser not causing all the financial problems?

    obviously, not enough appraisers reading these blogs.

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