These are particularly difficult times for a real estate appraiser. The past few years have been extremely tough for these professionals because of all of the pressure they are receiving to bring the homes in at the selling price, or above, so financing can me offered.

Appraisers are in the unenviable position of being hired by the real estate people who are offering homes for sale, or by the lender who wants to finance the loan. Unreasonable demands are being placed on the appraisers requiring them to state the value of the home at or above the selling price, even if their calculations disagree with this decision. Purchasers have a specific down payment available to them and this must equal the percentage required by the lender. If the appraisal is too low, the down payment will not be sufficient and the sale is then in jeopardy. Imagine how the selling agent feels if he loses a sale because of the appraisal number. He will no longer hire that specific appraiser because he or she is costing him his sale and his commission. In some cases they become very upset telling the appraiser they should never have accepted the assignment if they weren’t going to arrive at an appraisal comparable to the selling price. It is a terrible cycle and has been for years. As appraisal values increase, homes are selling for more than their actual value, and the result is the falling home prices that we are currently seeing. Many homes were appraised at an excessive value, and then the housing slump hit and these homes decreased rapidly from their inflated value to the actual possible selling price. This left people with mortgages they could not afford and the inability to sell their properties for the amount they needed to recoup. This is how we arrived at the current state of our economy.

Real estate appraisers realize that by appraising a property for more than it is worth, they are continuing the current decline of the housing market. They know that the home they are appraising is worth a specific amount. To raise their appraisal puts that home and the homeowner on the path to foreclosure. It would be hard to sleep at night if you knew your decision could cause a family to lose their home and eventually lose their entire investment.

It is difficult for an appraiser to ignore the pressure and submit an honest appraisal on a piece of property. Yet, this is what we hope they will do for both the benefit of the homeowner, and also the economy. The current situation must be addressed and the appraisers, if they stand by their values, can have a large influence on how we resolve this problem.