Introduction to Ground Leases

Posted by: McKissock Date: Sep 29, 2016 9:00:00 AM

The types of land that are most frequently ground leased include retail pads in commercial centers, land within high-density urban centers, land along ports and harbors, and other areas where land availability is low and land prices are high and expected to escalate. Are you interested in tackling ground lease appraisal assignments for commercial clients? Read this post for a breakdown of the typical tenants, reasons for use, motivations of the lessor, and potential disadvantages of ground leases.

Plus, check out our upcoming Pro-Series webinar, Commercial Case Study: Theme Park or Developed Site Value, on Wednesday, October 5 at 1:00pm EST. And take our Appraisal of Land Subject to Ground Leases course to gain a thorough understanding of the multiple components of ground leases. This information will give you a helpful edge when it comes to valuing commercial real estate, as well as prepare you to work with a wide variety of clients.

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Topics: Commercial Appraisal

How TILA Affects Appraisers

Posted by: McKissock Date: Sep 22, 2016 9:00:00 AM

The Dodd-Frank Wall Street Reform and Consumer Protection Act is the largest reform of our financial regulatory systems since the reforms following the Great Depression. After the Great Recession, Congress passed Dodd-Frank in an effort to protect consumers and the overall financial stability of the United States. Changes in the Act affect nearly every financial regulatory agency in the country. Part of the Dodd-Frank reform was amending four federal statutes: TILA (Truth in Lending Act of 1968), FIRREA (Financial Institutions Reform Recovery and Enforcement Act), RESPA (Real Estate Settlement Procedures Act of 1974), and ECOA (Equal Credit Opportunity Act of 1974).

The most important amendment for appraisers is Section 1427, which changes TILA’s section 129E on appraisal activities. The amendments to TILA are designed to protect both consumers and appraisers from anything that may affect the integrity of an appraisal.

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Topics: Regulatory Changes

Beginner's Guide to Commercial Appraisal Review Clients

Posted by: McKissock Date: Sep 15, 2016 9:00:00 AM

Commercial appraisal review assignments flow from different types of clients, each with their own intended use, required scope of work, and set of concerns for the reviewer to be aware of. This post is designed to provide practical advice for working with four specific types of commercial appraisal review clients. If you are new to commercial appraisal review, this information will be especially helpful.

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Topics: Commercial Appraisal

Hiring a Remote or Virtual Appraisal Assistant: Can It Really Increase Your Earnings?

Posted by: McKissock Date: Sep 8, 2016 9:00:00 AM

For appraisers, time is money. If you can complete more reports per year, you can increase your earnings substantially. As an appraiser, you are paid for your local market analysis and expertise, not your typing and data entry skills. An appraisal assistant can help increase your efficiency by taking care of the tasks that don’t require your judgment or knowledge. 

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Topics: Tips & Tricks

Appraiser Blacklisting: Why Are Real Estate Agents Turning Away Appraisers?

Posted by: Joseph Dobrian Date: Sep 1, 2016 9:00:00 AM

New conversations are starting about the occasionally fractious relationship between appraisers and selling agents. The complaint that some real estate agents are guilty of appraiser blacklisting (refusing to allow certain appraisers to appraise their listings) isn’t a new one. But it seems to have become more common lately.

Most often, apparently, agents complain that a certain appraiser lacks “geographical competence” (i.e., the appraiser doesn’t know local conditions). While this is sometimes a legitimate objection, appraisers fear that the unspoken complaint is, “This appraiser doesn’t hit the numbers I want him to hit. He’s a deal-killer.”

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Topics: Trends

Handling Appraisal Pressure from Unethical Clients

Posted by: McKissock Date: Aug 25, 2016 9:00:00 AM

It goes without saying that there's no simple, easy way to deal with appraisal pressure. A major source of frustration for appraisers is the realization that clients do not have to follow USPAP. The ethical and performance requirements of USPAP apply only to appraisers, not to clients. In other words, USPAP doesn’t prohibit a mortgage broker from calling and asking you to develop an appraisal based on a predetermined value, but USPAP does prohibit you from accepting that assignment.

Here, we put together a list of some possible ways to deal with appraisal pressure from unethical clients.

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Topics: Tips & Tricks

Where Do Appraisal-Related Adjustments Come From?

Posted by: Robert Grafe Date: Aug 18, 2016 9:00:00 AM

Appraisal-related adjustments are not just guesses by the appraiser or “rules of thumb.” Nor are they calculated numbers used to mathematically force a preconceived adjusted market value estimate in support of a value conclusion for the subject property. We tend to think of appraisal-related adjustments, as they pertain to residential appraisal assignments, as usually having to do with the sales comparison approach. However, it may become necessary to also provide cost approach adjustments and/or income approach rental adjustments that are not only necessary, but also appropriate, defensible, and reasonable.

Keep reading to learn about specific guidelines for adjustments, where appraisal adjustments actually come from, and a real-life example of adjustments in action. Plus, join McKissock and Josh Walitt for a Pro-Series webinar on Wednesday, August 24 at 1:00pm EST: How-to: Quality-Related Adjustment Methodologies.

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Topics: Residential Appraisal

Meet Former Golf Pro Turned Expert Witness Appraiser, Graham D. Smith

Posted by: John Hays Date: Aug 11, 2016 9:00:00 AM

What happens when a former golf pro decides to change gears ... and become not just an appraiser, but an expert witness appraiser? What happens is Graham D. Smith, CDA, Certified General Appraiser. Happily married to his wife, fellow appraiser, and business partner, Michelle, he is the proud father of two children. And, yes, he actually worked as a golf pro, having studied the industry at the Myrtle Beach campus of the San Diego Golf Academy.

But in 2009 he made the switch to practicing as an appraiser. These days, he and his wife head up their own firm, McCarthy & Smith Real Estate Services LLC—and expert witness appraisal work is a key component of their success.

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Topics: Expert Witness

The Realm of Relocation Appraisals

Posted by: Carole McCullough Date: Aug 4, 2016 9:00:00 AM

Up until the mid-1960s, the United States had, for the most part, a stationary workforce. The only people that seemed to move around with their jobs or careers were military personnel. That all changed with the dawn of the Age of Mobility. With the ease of transferring to a new location, and transitioning into a new career, evolved a new industry: relocation. As a result, corporations established a group to address moving household goods and real estate issues. This formed the basis for the creation of the Employee Relocation Council in 1975. Today this organization is known as Worldwide ERC, reflecting the mobility of a modern global workforce. This post will explore the realm of relocation appraisals and give advice on specializing in this particular area of residential appraisal.

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Topics: Residential Appraisal

HUD to Make Changes to Appliance Language in Handbook 4000.1

Posted by: Dan Bradley Date: Jul 29, 2016 3:42:43 PM

At a July 2016 meeting of regulators and appraisal professionals hosted by the National Association of Realtors (NAR), a HUD representative stated that the language in Handbook 4000.1 regarding appliances is going to be revised on or around September of 2016. The HUD representative stated that the exact language of the revision was still being worked on, and that it would be a clarification of the existing requirement. The current language in the Handbook states, “The Appraiser must note appliances present in the house at the time of observation and indicate whether that appliance is considered Personal Property or Real Property. The Appraiser must operate all conveyed appliances and observe their performance. The Appraiser must notify the Mortgagee of the deficiency of MPR or MPS if any conveyed appliances are inoperable.”

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Topics: fha, HUD