What is the future of the appraisal business?
- Oct 08, 2012 ArchiveThe appraisal field has changed more than any field in real estate profession in the last 5 years. Because of the housing crash the regulations in the appraisal educational field have been turned up-side down.
The effect of these regulations means that there are going to be fewer and fewer potential people desiring to become appraisers. In the end, this is really good news for individuals interested in going into the real estate appraisal field because in the end it will invoke basic law of supply and demand.
For the first step into the appraisal field, the course requirement requires 100 hours, composed of four courses. No state exam is required at this level. All the student needs to do upon completing the 100 hours of course requirement are to apply for a license. But at this stage there is another hurdle. Trainees are required, if they want to become active, to place their trainee license with a state certified appraiser, either a residential or general appraiser.
A certified appraiser can only have three trainees under their license. Plus, a state certified appraiser has to have been certified for 48 months before being able to bring on a Trainee under their certified appraisal license.
A trainee can be a trainee for as long as they want. A trainee is synonymous to a real estate sales-associate and as a real estate sales associate they work under the brokers license as a trainee works under the license of a certified appraiser.
If a trainee wants to become certified, they need to have a four year college degree in any subject. In addition, the trainee in the residential side must have been in the appraisal field for two years and have 2,500 hours of actual documented appraisal time. Trainees in the general field appraisal field must have been in the general appraisal field for 30 months with 3,000 hours of documented appraisal experience.
The other requirements to become certified are additional course requirements and a required state exam. The certified residential course requirements are an additional 100 hours and for certified general license the requirement is 200 additional hours.
As in any profession, there is a direct correlation between the number of people in the field and the number of services required for that product which directly affects the amount paid for the service. As the number of existing appraisers either leave the field or retire (the current field of appraisers is quite old), and as the real estate industry improves, as it will, appraisers are going to really benefit because there will be a shortage of appraisers. This in turn is going to increase the cost of an appraisal to the consumer which in turn is going to be a bonanza for the appraisal field.
Frank Cooke
President