A.D. Cantelmo Property Management
Our Business is Property Management in Orange County California
Are Appraisals starting to inflate
home values?
The home appraisal business has taken
a huge hit since the crash of the housing market. When things were getting out of
control and prices were on the rise, the appraisal seemed to always come in
just at the price that was needed to sell. As a Realtor at the time I was very
happy about the friendly appraisal and it got to a point that the appraisal was
never a problem.
Things have changed, but unfortunately not for the better but
to a great degree the appraisal business has gone so much the other way that
many people have not been able to sell their home because it has been impossible
to get the appraisal where it needs to be.
In my business of Property Management
in Orange County Ca. I understand the frustration of home owners today when the
appraisal does not come in at the price needed to sell, but according to the Wall Street Journal, 1 in 7 appraisals are starting to inflate the value of
homes. Now this may be good for the individual home owner, but will this return us
to the good old days and bring on another housing crash.
As the housing market starts to cool
down, the appraisers are under more and more pressure from Loan Officers and
Real Estate Agents who depend on houses to sell in order for them the make a
living.
Since new regulations have made it
much more difficult for appraisers to have a personal relationship with banks
and Realtors, that does not mean the pressure that appraisers feel is not real.
Much of the pressure, appraisers say, is being applied by companies
hired by banks to assign appraisal work, known as appraisal-management
companies, or AMCs. A much larger share of appraisals have been filtered
through these companies since the introduction of new financial rules and other
requirements that seek to prohibit appraiser coercion.
You can see that while these regulations are put in place to
try and avoid the problems of the past, there is always a way around them. The
problem always comes down to appraisals, instead of finding a happy medium; the
swing is from one extreme to another. On the one end, the property owner and
the Realtor and Loan officer are very happy when the appraisals come in where
they need them to be, but to the other extreme, no one is happy and a deal
falls apart.
In my business of Property Management in Anaheim Ca. I really feel that soon, the appraisal will be more
automated then not, in fact, Lenders who sell loans to Fannie Mae will soon be able to
use Fannie’s proprietary appraisal analysis application, Collateral Underwriter,
to analyze loans prior to closing to ensure that the loans conform to Fannie’s
standards, which should decrease repurchase risk. Collateral Underwriter is a
tool that will apply a risk score to a loan.
This may not be good news to Home Owners, but we will see
how it all plays out in time.
A.D. Cantelmo Property Management Specializes in Property
Management in Orange County Ca.