College Degree Requirement Misguided
- Listening to Appraisers - January 31, 2020
- 2017 Fee Survey Analyzing the Data - October 2, 2017
- College Degree Requirement Misguided - April 4, 2016
The college degree requirement seems more like a forced attempt at elevating the status of the profession by closing the club, and that strikes me as elitist.
I know about half of you disagree but the college degree requirement for Certification was a wrong turn for the industry. To its credit the Appraisal Foundation (TAF) is on the right track in trying to find a way out of the corner it has painted the profession into but it doesn’t look like it intends to go far enough in fixing the problem. As we all know by now, veteran appraisers as well as newbies can be licensed without a college degree but not Certified. Because so much of the business today depends on being Certified, not holding that license level can be a very limiting condition indeed: it disqualifies appraisers from most AMC and lender panels and excludes them from working for the FHA. A lack of opportunity has driven many good appraisers from the business and for the first time in a long time, there is a shortage of new appraisers entering the profession. This is not good news.
Without new vitality to innovate the profession, it will wither and die. Lenders will create alternative solutions that combine big data and low-fee “property inspections” for all but the most unique properties to replace appraisers. To the current “shortage” of appraisers you may be shouting “Hallelujah!” while you enjoy some long-overdue increases in your fees. But if you’re really honest with yourself you must agree that a college degree is no predictor of good work or good behavior (there are far too many examples from our profession and others that make that statement sadly ridiculous). Training, testing and time can separate the wheat from the chaff when combined with consistent enforcement. Effective oversight will identify repeat violators and patterns to reveal who won’t or can’t adopt accepted techniques or who refuse to play by the ethical rules. We all agree these types should be expunged from the ranks but a college degree does not guarantee competency or ethical behavior: so what is it about?
The college degree requirement seems more like a forced attempt at elevating the status of the profession by closing the club, and that strikes me as elitist. Not everyone has the opportunity, resources or aptitude to attend and/or flourish in college. Some very smart people just don’t learn via traditional education methods. And holding up the education requirements of other professions like attorneys, doctors and CPAs just does not hold water. An accountant is a more apt comparison and while a college degree is recommended, it is not required to become an accountant, nor is it to become an engineer, software developer, airline pilot or journalist for that matter. A recent letter from a reader points out that a degree is not even required to be President of the United States! The requirement is even more dubious when you consider that a degree in any subject passes muster for becoming a Certified Appraiser, no matter how unrelated (think French Literature for instance), while someone with the skills to flourish in this business would be shut out for all intents and purposes without a degree.
The folks at TAF tell WRE that they are looking into alternative paths to Certification for veteran appraisers with “a track record of professional (appraisal) experience.” That’s very good but not good enough. The college degree requirement for new appraisers ought to be replaced by some combination of education, coursework and testing so that a whole new generation of young, smart and tech-savvy entrepreneurs has a chance to contribute to the profession, whether they are cut out for college or not. Many young candidates will be your sons or daughters or grandchildren. Are they all destined to graduate college? Like you, they should be able to enjoy a profession that allows them to be their own boss while making honest living and a valuable and rewarding contribution to their community. To dig in on this issue and leave the college degree requirement in place for prospective appraisers without any reasonable path to Certification risks the future of the profession and turns away many men and women who could add to its legacy.
TAF believes there is no opposition to the college degree requirement among appraisers. Whether you agree or not, you can share your opinion and feedback with Working RE’s new Future of Appraisers Survey. We will publish the results for all to see, whatever you decide.
The AQB will hold another public meeting on these issues on Friday, April 8, in Phoenix, Arizona. For more information click here.
Take Survey Now
Let your voice be heard! Share your opinion on the college degree requirement, trainee experience requirements, and more with Working RE’s Future of Appraisers Survey.
The college-degree requirement appears to simply be a response to the massive problems in the industry due to what were essentially non-existent entry requirements, the lack of enforcement, and the potential to make plenty of money in a boom market. I had taken several entry-level courses prior to licensing, which where only available through appraisal societies and colleges. I also took entry level courses (for CG credential) through proprietary schools post-licensing. The former classes were full of mostly college grads who looked, dressed, and acted like professionals; the later was like a scene out of “Animal House.”
IMHO, the college degree requirement isn’t a big deal. Scanning the surveys, probably 2/3 to 70% of appraisers had it before it was a requirement. The issue is the appropriate compensation for the increase in licensing requirements. In many parts of the industry, after consideration of supply and demand factors, the compensation is appropriate (CG work, specialty work, etc.). It obviously is not at a reasonable level in other market segments that are currently oversupplied, and where many of the appraisers don’t meet the current licensing requirements. That will fix itself over time.
Nor I believe to be a justice of the Supreme Court!
Or to become a U.S. Senator!
I think a minimum of an Associate Degree should be required.
Most of the appraisers I know have a 4-year degree, but went into appraising after failing at or not enjoying other careers. But that was at a time when there was a light at the end of the tunnel.
If the minimum fee were $450 to $500 on a 1004, you would have plenty of college grads making the transition into appraising as trainees.
Fees are already at those level in many cases; AMCs typically charge that or more. Eliminate the AMC and the problem is solved. FWIW, my fees start at $425 for residential work, and that is for non-lending assignments with no UAD form, no 1004MC, no Cost Approach, etc.
You’re selling yourself short if you think $500 is an adequate fee considering the massive scope that’s taken place since 2009.
When fees go higher, and they will, we will again AFFORD to pay assistants. THEY took our money, all greed, and we lost our office managers and assistants.
Stick to you guns appraisers, things are achanging !
First things first folks:
1. Eliminate the monthly AMC extortion payments.
2. Get the fees in line with the work you are now being forced to do because of scope creep ($800ish).
3. Keep the college degree requirement in place. If you’re getting paid $800 per appraisal (as you should be) college graduates will gladly consider the profession.
You’re putting the cart before the horse with this argument.
Certified Appraiser License – Let’s do the math…
For those that believe a degree is the best and only path for the Real Estate Appraising Profession as a whole, then you need to read the requirements for an Apprentice Program. Apprentice Programs are how a wanna be Appraiser becomes an Expert Appraiser.
Lets examine what the requirements are just to apply to take the Certified Appraiser License test:
Four years to complete the degree and the cost of the degree
Six – twelve months to complete the State Mandate Appraising classes and the cost of the classes $2,500 – Two hundred (200) creditable class hours as specified in the Required Core Curriculum
Pass Trainee License Exam – Cost of exam(s)
One day – many years to obtain a Supervisor – Hopefully this is a family member that has been patient for you to finish this education and willing to pay your student loans, healthcare due to Obama Care and give you a paycheck. Candidates that have no relative or prior agreement with Certified Appraiser – Good Luck –
Obtaining clients willing to accept appraisals from Trainee and eventually Licensed Appraiser.
Minimum two years + for mandatory experience (Working for free) Two thousand five hundred (2,500) hours of qualifying experience obtained in no fewer than twenty-four (24) months.
Obtain clients that already have their Appraisers and not willing to accept new Appraisers due to newbies never give them the number they want.
That equals 4 + .5 + 2 = 6.5 total years invested just to apply to take the Certified Residential License Test.
Hmm… 4 years for a degree and 2 years for a Master’s Degree. = 6 years. Making Money to pay off loans and get out of parents house!!
No one has to pay your student loans due to you are still in college. Deferred Payment. Loans or Parents still paying for you to complete degrees.
There has not been an increase in Appraisal fees for 10 years so I don’t know how anyone is going to charge $800 for an appraisal. Being realistic – $450.00 fee for an appraisal (if you create your own business) with minimum of 6.5 years of education and experience. Possibly 250.00 split fee due to paying your share of expenses for firm you work at.
Don’t forget expenses as an Appraiser you should be able to calculate your pay, subtract all Accountant fees, business licenses fees, business equipment costs, business equipment taxes, access fees, continue education fees, license renewal fees, vehicle fees, gas, membership fees, health care coverage, dental coverage, (401) retirement account and various other expenses.
A college degree in basket weaving, graphic artist, photography, drama, child and adolescent development or sports medicine has minimal if any impact on an Appraiser evolving into an expert in the Art of Real Estate Appraising.
Practical experience is the Key to Real Estate Appraising success.
Appraising is an Apprenticeable Occupation. An Apprenticeable Occupation is a skilled trade which is customarily learned in a practical way through a structured systematic program of on-the-job supervised work experience, is clearly identifiable and recognized throughout an industry, and involves manual, mechanical or technical skills which requires a minimum or 2,000 hours of on-the-job work experience, requires related instruction to supplement the on-the-job work experience. Any college degree probably has nothing to do with a career as an Appraiser unless the degree is specifically for Real Estate Appraising. Although, certain college classes are beneficial to the Appraiser and appraising profession they should not be mandatory. Examples of suggested college classes: Economics, Accounting and Business Writing.
Even with the state’s 7.4% August unemployment rate, businesses and organizations have been scouring job boards for applicants with technical expertise and trade skills — especially in the areas of construction, IT and computer programming, robotics operation, basic engineering and health care work.
The jobs, while not immune to economic downturns, have weathered decades of offshoring and worker elimination via automation. The typical pay is between $30,000 to $80,000 a year — not including overtime.
These jobs are often in traditional blue-collar fields, but in today’s economy, some of these workers can bring home bigger paychecks than their white-collar peers in office cubicles. A job posting may still list a bachelor’s degree as desirable, but the key phrase is “or equivalent experience.”
Apprenticeship Program is the best education to make a Wanna be Appraiser into an Expert Appraiser!
Thank you for your time and consideration on this matter.
This info is from here and here.
Good comments Linday, but let me add a few. After I received my certified license several years back I was limited on who would add me to a panel as Flagstar Bank at the time had a requirement for 5 years of experience after licensing. This requirement prevented me from joining many companies as I technically could not work for all of their clients. In more recent times I was added to a panel only after It was confirmed that I had a minimum of 10 years of experience post certified licensing. I also recently completed a jumbo loan field review after I met the clients specific 8 years of experience. Lastly, I know of many appraisers who have been on the VA panel wait list for several yeas. The journey to receive your license may only be the beginning of the wait period before one may become fully employable. If you say the trip is 6.5 years than you may need to add an additional 3 to 10 years to consider yourself fully employable (9.5 to 16.5 years).
Lindsay,
You are absolutely correct that there has been no pay raise for appraisers in 10 years, in fact appraisers now get paid roughly 70% of what they were being paid 10 years ago. Factor in an increase in the cost of everything that you buy and you’re probably bringing in 50% of what you were bringing home 10 years ago. Now let’s take it a step further: You’re easily doing twice the work per appraisal that you were putting into each order 10 years ago. Factor that in and let’s say you’re making 25% of what you were making 10 years ago (taking your increased labor into account).
You are also absolutely right in stating that nobody is (or will be) willing to pay $800 for a basic appraisal order. What I was trying to say in a nice way is that if you aren’t charging $800 for an appraisal order today you are a fool to be in this business. Since nobody is charging $800 for a basic appraisal I suppose that makes every active appraiser a fool. April Fools in this case. What irony.
Why is it that appraisers swear on their lives to be professional assessors of value when they can’t even assess the value of their own time?