What I’ve always loved about working in the appraisal field is the opportunity to get out into the community daily. Being immersed in the local real estate market has helped me develop a keen insight into the economic factors that influence properties in my community of Massachusetts. Part of the reason we write this blog is to share with you what we’ve learned from our practical experience. There’s not a lot of public education out there regarding the subject of appraisal and the valuation process, so we’ll bridge the gap here.
When you need an appraisal, you need it fast. There are very few instances where there’s lots of time to wait for a report. The speed and gravity of the real estate closing and investment analysis process demand prompt reports that feature intensive detail, accurate adjustments, and solid reconciliations.
As valuations play a critical role in the real estate industry, it’s important to spend some additional time evaluating the best provider for your valuation needs. Reports that are questioned or rejected by lenders and investors lead to delays in closing and lost opportunity.
Technological advancements in market/property data collection, regression modeling techniques, and project management allow modern independent appraisal firms to deliver reports unmatched by larger firms that work through a network of contracted appraisers that are often sent out of their geographic and property class area of expertise.
You might think that a fast report means the potential for errors in a hastily prepared valuation; however, speed comes not from skipping important considerations in the appraisal process, but from having an expert in-house team that acts quickly to conduct the inspection, prepare the report, and ensure accuracy.
Speeding up the Process and Delivering Quality Reports
Many businesses and individuals in the real estate market are accustomed to waiting 2-3 weeks or longer for an appraisal report. This is attributable to fact that most reports are sourced through appraisal management companies that add unnecessary delays to the process.
Working directly with local appraisers affords you greater quality and speed by eliminating the unnecessary bureaucracies inherent in large organizations that don’t retain their own appraisal staff and don’t place customer service or efficiency at the forefront of their corporate values.
Rather than casting the net wide, independent appraisers focus on understanding the Massachusetts real estate market and delivering reports that reflect the unique factors present in each submarket on the shortest time scale possible.
How to Balance Speed and Quality in a Massachusetts Appraisal
Conducting the inspection and preparing the report are only half the story. Quality control or (QC) is equally vital to ensuring that your reports are top-notch. Here the efficiency and accuracy come in utilizing SRA and MAI designated appraisers to review each and every report. Reviewers look at the market data, comparable selection, adjustments, and every detail to ensure consistency and that the conclusions are rational and well-supported.
But it goes further: is the report professional in appearance? Is everything grammatically correct? Do the subject and comparable photos show the pertinent details to accurately assess condition, location, and functional utility? Does the report give you a complete picture of all the internal and external factors that influence the value of the property?
All of these aspects of a valuation are critical to ensure the legitimacy of the report, guarantee accuracy, and positively reflect on your organization (if you’re ordering as a business). Poorly prepared reports not only damage the credibility of the client when forwarded to lenders and investors, but also can cause real financial and liability issues if at a later point the value is discovered to be erroneous.
If you’re a homeowner or investor that’s ordering a report on your own behalf, the same considerations apply, but often the stakes are higher. When you’re crossing your fingers, hoping for a smooth closing, it’s best to partner with appraisers that are part of your community and place not only the quality and speed of the report as priorities, but also excellent customers service and the willingness to stand by their work, answer every concern, and make prompt revisions where needed.
For personal and business valuation customers alike, spending a little extra time researching local appraisal firms, reading their reviews, and asking questions about their process and follow-up support will ensure that your transaction has a positive outcome in the short and long term.