2017 Fee Survey Analyzing the Data
- Listening to Appraisers - January 31, 2020
- 2017 Fee Survey Analyzing the Data - October 2, 2017
- College Degree Requirement Misguided - April 4, 2016
Surveys Said: Increasing Fees and Turn Times…
For the last few years the appraisal industry has been abuzz with talk of rising appraisal fees and longer turn times. AMCs complain of a shortage of appraisers and “price gouging” in certain markets (Colorado and Oregon, for instance); appraisers report modest success at raising their fees after years of frustration (See Fees Rising).
With over 7,000 appraisers responding so far, the results of the 2017 Working RE/OREP Appraiser Fee Survey is a current source for fee and turn time data by market and nationwide. To view the survey results for your market, click here. The number in the right-hand side in parentheses is the total number of appraisers in that specific MSA who responded at the time of this writing.) The survey remains open if you have not participated yet. The data is provided free to appraisers and all industry stakeholders.
The new fee data offers an interesting comparison with the results of the first Customary and Reasonable Fee Survey, which was conducted in 2010 in the wake of the Home Valuation Code of Conduct (HVCC) and the ascendance of AMCs. The first survey results measure non-AMC appraisal fees only—where appraisers and clients negotiated fees directly without a middleman. The new survey makes no distinction. So today, more than seven years later, the comparison of fees and turn times between then and now— before AMCs and after—offers Working RE readers a unique perspective.
Both surveys include 365 Metropolitan Statistical Areas (MSA), as defined by the U. S. Census Bureau, with rural areas included by state. Each survey includes eight different appraisal products, including reviews and FHA appraisals. Both surveys address turn times. While the earlier survey includes only non-AMC appraisal reports, the current survey draws no distinction between AMC and non-AMC appraisals, as noted.
Increasing Fees and Turn Times
The new survey results show higher fees in many markets compared to 2010 but for most, only marginally. Turn times have grown in many markets as well. As you compare the fees in your area, note that the Cost of Living Adjustment (COLA), which is tied to inflation and on which social security benefits are paid, has increased 8.8 percent in the same time period. The Consumer Price Index has gone up 11.3 percent.
Comparing Then and Now
The tables posted here compare data from the two surveys in a few select markets. Complete data from all 350 MSAs nationwide are available here. As you will note, fees in certain areas have stagnated, a few have actually declined, but overall, a modest increase can be observed in many markets. Some markets have improved dramatically.
Click here to see the Tables comparing Fees and Turn Times.
The fee/range reported for each MSA reflects the result with the greatest percentage of responses.
Modest Good News
That appraisal fees appear to be rising modestly in many markets is good news for appraisers. But as you can see, appraisers in certain locations are faring much better than in others. It should also be noted there are probably 20 percent fewer active and licensed appraisers working today than there were then.
Both surveys include fees and turntime data on a number of appraisal products, including the 1004 REO, 1004 FHA, 2055, 1025, and more.
After seeing fees decline substantially with the imposition of AMCs, the fact that many appraisers have regained some or all of what was lost (and then some) offers hope of better times to come.
The data should be a strong nudge to those appraisers in competitive markets who have not yet raised their fees and/or enhanced their product. If you are not confident enough in your skills to raise your rates to market, there are many resources available to you, including quality online CE offered through OREPEducation.org. Economical bundle pricing is available on a variety of coursework. OREP insureds save.
Thanks to the many thousands of appraisers who helped make the survey possible. If you are an appraiser and have not yet taken the survey, please weigh in today! And when it’s time for E&O, shop OREP for great appraiser insurance rates, broad coverage and fast, efficient service. Thanks for reading!
Republished with Permission from Working RE Magazine, published by OREP.org, a leading provider of real estate appraiser insurance nationwide.
I checked a few states and it looks like no one quotes $175 to 300 as reasonable. And very few $300-350
David, WHY would WorkingRE commission a study that includes AMC fees mixed in with real fees? The blended result negates the entire study IF they are supposed to represent REASONABLE or CUSTOMARY fees as defined under Dodd Frank. If the study is NOT a purported report of ‘cusotmary’ fees (conveniently leaving out the reasonable part), then why do it at all?
To what purpose?
Why not break the results down into the same segments you did but with a further distinction such as “AMC ordered” “Non AMC ordered”? THAT would be eye opening and meaningful.
You have done a huge disservice to appraisers across the nation. Now YOUR study can or may be cited as the support for ongoing payment of low fees by AMCs.
By the way, the average itself is invalid. I’ve filled out many of these surveys and all cap out at ‘$750 and over” but the numeric indication remains $750. MOST of my sfr work is in excess of $1,000 and sometimes up to $4k. I know several appraisers like that. They are court recognized experts….just as most appraisers with more than 10 or 15 years experience should be.
WorkingRE is increasingly becoming a source of data and services that are aimed to benefit non appraisers; such as the data typists you take ads from or all the other ‘replace the appraiser’ software under the guise of assisting appraisers in doing their jobs better.
David, If an appraiser uses one of those corner cutting services you advertise and there is a resulting license complaint, is WRE or your E&O insurance going to defend them?
Interesting side note. Just today the clearbox avg fee is $538. Now who’s parsing data and how? Well, it’s a free market, appraisers have always been in control but rarely assume that position. Previous fee studies point to $850+ being the required standard fee for appraisers to retain similar market positioning as they did 20 years ago. If the amc personnel are earning more than you, you’re doing it wrong.
If it includes fees paid by AMCs then it’s definitely NOT REASONABLE.
Has it already been 6 years since the interm final rule? Refresher time;
Institutional memory is readily apparent.
It’s the volume states that changed the game recently. Hot market states have seen fee increases. It’s important to understand this was an action reaction event. For every lender who grew frustrated or disillusioned from amc service performance, they found going direct brought immediate relief in terms of turn time, and sometimes also fee. For every one who swapped to direct, the amc’s had longer delays and word got around going direct can literally cut a 4 month wait down to a few weeks or a month. And I speculate lenders understand this new paradigm in that the lending origination game relies on volume in high volume areas and they were at a natural disadvantage by selecting amc’s compared to direct. Many lenders have or are transitioning away from amc’s nationally, but only one region or location at a time. Others have preferred direct sourcing for hot areas first, while still sending amc work in other locations. To help get your mind around this think of hot areas like locations where all appraisers intentionally or unintentionally boycotted amc’s. When the phone rings off the hook and emails come by the dozens and hundreds daily, free market principals apply and it’s obvious which clients to prefer and whom is wasting your time. Some amc’s vainly tried to message 50 appraisers per order, desperately seeking fulfillment at any cost. But why bother when the increases were temporary with the amc, but permanent with direct? The inability of amc’s to negotiate on behalf of appraisers is their achilles heel. Their intention to advocate for lower fees and turn times on behalf of lenders and customers instead of fulfilling their duty of being an impartial middle manager nailed the coffin shut. Their downfall is their inability to justify their own charge over and above the standard VA and/or lender direct fees. The lenders know the hot markets will eventually shift here or there and they are ready to transition in any area where turn times run much longer. So if you’re worrying about 3 days vs 5days or even anything under 2 weeks, you’re working against your own best interests. The amc’s got exactly what they promoted; ready substitutability. Grading is subsequently re affirmed as a pointless matrix which does not account for the larger more important industry positioning. Staying power in this industry is so much more than fee and turn time. Now that we’ve paved the way, it’s up to the rest of this nations appraisers to make sure the message get’s through. Make sure you pick up at least one direct client and promote that model by always prioritizing those orders first. It’s so easy, a caveman with an appraisers license could do it.
Washington state should be seeing an influx of 80,000 appraisers fairly soon. $800 – $900 for a 1004! This appears to be the only SANE state in the nation with regard to appraisal work. I cannot imagine taking on a 1004 these days for a scrawny $400. I was making that 8 years ago prior to having 18 tons of additional requirements thrown on top.
Go Washington State!
Downside is that it is Washington State! Beautiful country populated by those that think California is a right wing extremist state.
Kidding aside, from my own studies $800 to $900 s what an experienced appraiser SHOULD be getting for non complex conforming loan limit sfrs. ANYWHERE!
I agree 100% on your fee argument. I also believe Washington state is the most beautiful state I’ve ever had the pleasure to visit.
Glad to know that appraisal fees are rising nationwide. However, I agree with others that amc fees should not have been included in the survey. amc’s shouldn’t be taking any portion of the appraisers’ fee. They should charge their clients for their services. amc fees are clearly service fees/bank administrative fees and not actual appraisal fees.