By Mike Pratt ASA, IFA, Chair, RP-NAIFA Discipline Committee
Editor’s Note: In today’s rapidly evolving real estate landscape, the importance of staying informed and connected within the appraisal industry has never been greater. ASA stands as a valuable partner for appraisers, offering a wealth of resources and support to navigate these changes. This article, drawn from a presentation by Mike Pratt ASA, IFA, at the 2024 ASA-IFA Eastern Region Appraisal Conference, delves into the dynamic world of real estate appraising. It explores the historical milestones that have shaped the industry, the technological advancements influencing current practices, and the invaluable benefits of ASA membership in fostering professional growth and maintaining industry standards.
The Changing World of Appraising
Real estate appraisal is an ancient practice, with its origins tracing back 3,200 years. ASA was established in 1936 and is the oldest and largest multidisciplinary appraiser organization globally. Over the decades, significant events have shaped the appraisal industry. In the 1980s, FIRREA legislation emerged due to a financial crisis. In 1987, ASA, along with six other organizations, founded the Appraisal Foundation. The stock and housing market crash of 2008 marked another turning point, followed by the implementation of the Home Valuation Code of Conduct (HVCC) in 2009 and the introduction of Appraiser Independence Requirements (AIR) in 2010. In 2021, the focus shifted to appraisal bias through Property Appraisal and Valuation Equity (PAVE), and by 2022, concerns arose about AI potentially replacing real estate appraisers.
What’s Causing the Change?
Several factors are driving changes in the appraisal industry. With rising interest rates, fewer people qualify for home purchases or refinancing, leading to an increase in appraisal waivers, where loans are issued without the need for appraisals. Automated Valuation Models (AVMs), which use AI-driven valuation methods, and desk appraisals, which involve limited-scope appraisals replacing full inspections, are becoming more common. These changes are driven by lenders’ dissatisfaction with inconsistent appraisal work. Consequently, the demand for traditional appraisals is decreasing due to higher interest rates, more waivers, desk appraisals, and AVMs.
Will Real Estate Appraisers be Replaced by AI?
The answer is no. While AI and automated valuation technologies enhance the appraisal process by increasing efficiency and accuracy, they cannot replace experienced appraisers. Human expertise remains crucial for on-site inspections and unbiased evaluations. The evolution of AVMs offers alternative valuation methods, but the need for human appraisers persists.
Appraisers Must Embrace Change
To stay relevant, appraisers must learn new technology-based skills and pursue further education with ASA to remain competitive.
Job Market Outlook
The job outlook for property appraisers and assessors is positive, with a projected 4.0% increase in job openings by 2032, according to the Bureau of Labor Statistics.
About ASA
ASA is a distinguished organization representing all appraisal disciplines. Since its inception in 1936, ASA has been committed to the appraisal profession. In 1987, ASA co-founded the Appraisal Foundation to establish uniform standards for professional appraisers, recognized by the U.S. Congress in 1989.
Why Choose ASA?
Choosing a professional appraisal organization is an important decision. ASA offers professional development, designations, and networking opportunities. Your membership investment in ASA brings significant value, demonstrating your commitment to excellence and credibility in the appraisal field.
ASA Real Property Member Benefits
Members enjoy numerous benefits, including professional referrals, public relations programs, legislative representation, free subscriptions, member-only rates, media training, networking opportunities, access to a free online community, use of the ASA logo, dedicated staff assistance, job search resources, and discounts on various products and services, such as background screening, car rentals, databases, hotels, insurance, marketing, office supplies, shipping, subscriptions, and education.
ASA Real Property Designations & Certifications
ASA offers several designations, including Accredited Senior Appraiser (ASA) for state-certified general and residential appraisers, and those specializing in ad valorem/mass appraisal. They also offer the Accredited Member (AM) designation for state-certified general and residential appraisers, and the Going Concern Specialty Designation (GC).
Additional ASA Membership Options
ASA provides various membership programs, including the Ally Program, Affiliate Program, and Free Student Affiliate Program. For more information on membership, visit ASA online or contact Susannah Coleman, Membership Manager, at scoleman@appraisers.org or (800) 272-8258, ext. 2112.
Mike Pratt ASA, IFA, is Chair of the ASA RP-NAIFA Discipline Committee. He is a retired Palm Beach County Property Appraiser, a past Florida Department of Revenue Certified Florida Evaluator (CFE), a Florida state-certified real estate appraiser (RD6580), a Florida state-certified residential appraiser instructor (IR1000109), a licensed community association manager (CAM), and a Florida realtor.