I was speaking with an AMC executive recently (yes, appraisers and AMC employees can talk to one another) as a friend. He and I were swapping stories and he told me one that just made me recoil in shock and simultaneously laugh at the irony.
He said that one of his panel appraisers had recently called him for the purpose of explaining his new fee schedule. In a paraphrased paragraph, here is what he said;
“My base fee is $350. For that amount of money, you will get a basic inspection (measuring, standard pictures, and notes), and a basic write up (three comps and no extras). If you want additional comparables or listings, they will cost you $20 each. Additional inspection items such as attic and/or crawlspace will be extra. If you give me revision requests, that will cost you $50 each.”
Now, I am not faulting this guy for being creative, but really? You think the AMC is going to go for that kind of business model? Yeah, me neither.
After the conversation with my friend who works for a successful AMC, I thought some more and why this appraiser has felt backed into a corner. We are in a tough spot right now in the appraisal profession. Scope creep is real. The extras we are asked to do (sometimes with no bearing on value) are oftentimes nothing short of ridiculous. It can, and continues to be, a challenge to be a professional and still make a decent living as a real estate appraiser. That being said, perhaps there is a better way out of this mess.
It is wise, at times, to step back from our emotions and remember the real world we live in. You do not order an entree at a restaurant and pay separately for the chicken, herbs, and sauce. An appraisal product is a service. It is typically paid for in a package. Certainly, there are extras (i.e. rent schedules, operating income statements, final inspections, etc), but most of the time your client is paying for the complete service, not each component a la carte. Furthermore, though it is not always the case, aren’t at least some of those revision requests coming because you failed to do your job in the first place?
I am as frustrated with our current lot as the next guy. We should do all we can to influence change for the better. However, I am also a pragmatist. I have no Fairy Godmother to wave her magic wand and send me off to the ball. In the end, life is life. We either choose to be an appraiser in today’s world (with all that goes with it) or we do not. I, for one, choose to stay.
For more information on this subject, please listen to The Appraiser Coach Podcast Episode:
