St. Louis Mortgage Rate Update; What Appraisers Look For When Determining a Home’s Value?

The primary indicator of value for residential real estate is comparable sales.  The appraiser researches the market to gather information pertaining to sales, listings, pending sales that are similar to the subject property, and verfies this information is correct. The appraiser actually already has a good idea of the property’s value by the time they have scheduled an appointment to stop by the property.

Since the appraisal provides half the weight in any credit decision involving the security of real estate, the appraisal should be done by a qualified, licensed appraiser whom is familiar with your neighborhood, and the type of home you are buying, selling or refinancing. Continue reading “St. Louis Mortgage Rate Update; What Appraisers Look For When Determining a Home’s Value?

Tips to Avoid Appraisal Problems

Dennis Norman St LouisYou finally reach a deal with a buyer to sell your house, or strike a deal with the seller of your dream home, only to see the deal fall apart later when the house doesn’t appraise for the price that has been agreed upon…what are you to do? This is a plight that has become all too common today for many buyers and sellers. Why? Several reasons….appraisers have, after being blamed by many for causing or contributing to the downfall of the housing market, understandably so become cautious and somewhat conservative when putting a value on a home today. Not to mention, since about a third of the home sales are distressed sales and prices are still falling somewhat in many markets, the “value” of a home is a moving target.

What can home sellers and buyers do to avoid appraisal problems? Continue reading “Tips to Avoid Appraisal Problems

Making Appraisers the Scapegoat

Dennis Norman St LouisIt seems we always need to find someone to blame for our problems…

When it comes to the meltdown in the housing market that has taken place over the past three years there has been no lack of finger pointing by many inside and outside the industry as to factors that either caused or contributed to the collapse of the housing market. Sub-prime lending, Wall Street, mortgage fraud, the mortgage industry, banks, community reinvestment act, real estate brokers and agents, fannie mae, freddie mac, federal government over-regulation, federal government under-regulation, appraisers, unemployment, the economy in general, “flipping”, sellers, buyers and more have been blamed in one way or another for the collapse. In my humble opinion and, based upon my 30+ years of experience in the industry, I would say all the aforementioned played a part in the collapse and certainly no one thing could have caused this mess on its own, it was a combination of several things that led up to the “perfect storm”. Continue reading “Making Appraisers the Scapegoat

H.R. 4173; The Dodd-Frank Wall Street Reform and what it means to appraisers

Frank Gregoire

Frank Gregoire

My world was much different in the late 1980’s. Although I was in the real estate business and the real estate appraisal profession for a decade, political activity did not interest me. Here at Gregoire & Gregoire, we had already been using a networked mini-computer for appraisal reporting since 1983, but I did not have an email account or address. I did not surf the web. Our clients were savings and loan associations, FHA lenders, loan discount companies (purchasers of privately originated first and second mortgages), real estate brokers, and several lawyers. All our research was completed through examination of paper and microfiche records. We went through Polaroid SX-70 film packs by the case and always kept a spare camera or two in the back seat or trunk of the car. Life was good. The appraisal profession, at least here in the Sunshine State, was one coveted by many. Continue reading “H.R. 4173; The Dodd-Frank Wall Street Reform and what it means to appraisers

HVCC, AMC’s and the Appraisal Industry; a view from the inside

Editor’s note – Last month we published an article about HVCC which drew quite a few comments and responses….one such response was from veteran appraiser Paul Collins in which he shares his frustration with the state of the industry and the impact of lenders and legislation on his industry. Our thanks to Paul for allowing us to publish his thoughts..

The good ole days of direct communication and the new day we are “living” both have the same problem. Appraisers are not a valued part of the process because there are no consequences for bad lending decisions. The last time a bank valued a competent appraiser was when the local bank kept the paper and was responsible for collecting and foreclosing if that loan went bad. A real and legitimate understanding of the actual value of a property played a part in a thoughtful consideration of the overall loan application. (It even included the capacity and willingness of the borrower to repay the loan! What a concept!) Continue reading “HVCC, AMC’s and the Appraisal Industry; a view from the inside

Financial Reform Bill Kills HVCC; Helps Appraisers

Dennis Norman

07/17/10-Correction – This past week Congress passed H.R. 4173, the Wall Street Reform and Consumer Protection Act which is the most comprehensive reform to the banking industry since the Great Depression.  The bill now awaits President Obamas signature which is expected to happen in the coming week.

This is a very comprehensive bill and I’m not sure even the Congressmen that passed it know everything that is in it, so I’m certainly not going to even pretend to know that much about the bill, but the one thing I do know is the Home Valuation Code of Conduct (HVCC) is dead. It’s been a while since I have written about HVCC but to refresh everyone’s memory HVCC is something has wreaked havoc with home buyers, REALTORS and appraisers. HVCC, which went into effect on May 1, 2009, has caused issues and confusion in the real estate industry and among professionals in the industry.

Killing HVCC will be, in my opinion, be a positive thing for the real estate market.

Not All Home Improvements Lead to Higher Value

Dennis Norman

Homeowners looking to upgrade or sell their home this spring should realize that not all remodeling and renovation projects will yield a full return on their investment, the president of the Appraisal Institute said today.

“When it comes to home improvement projects, especially in today’s economy, not every renovation or remodeling effort will pay off when the owner sells their home,” said Appraisal Institute President Leslie Sellers, MAI, SRA. “Consumers need to be aware that cost does not necessarily equal value.”

For consumers looking to upgrade and possibly sell their houses this spring, Sellers has put together a quick list of advice that real estate appraisers often share with homeowners:

  • Emphasize the essentials over the extras by investing in basic upgrades, such as fresh paint (use neutral colors) and new fixtures.
  • Know that curb appeal is vital; exterior projects can sometimes provide a greater return on investment than interior projects.
  • Avoid over-improvement by sticking to what’s proportional in your neighborhood.
  • Consider adding a bathroom, bedroom or renovating the kitchen, which are appealing features for home buyers.
  • Projects that add square footage to bring a house up to – but not significantly beyond – community norms typically yield good returns.

Sellers also recommends that homeowners who are serious about knowing their home’s value hire a professional real estate appraiser. Appraisers can help by providing honest, ethical valuation advice regarding which renovation projects will yield the greatest return on investment.

The appraisal institute has a handy online resource for locating an appraiser in your area.  You can access the site by clicking here.

The appraisal institute also has a brochure available that gives useful tips to help homeowners decide which remodeling or renovation projects will rturn the best value.  To download this free brochure click here.


Appraisal, Loan Modification and Foreclosure Lawsuits Soar

Dennis Norman
Dennis Norman

A surge in litigation tied to real estate appraisals, loan modifications and foreclosures contributed to a 54 percent increase in mortgage-related lawsuits, according to the second quarter Mortgage Litigation Report from

During the second quarter, 125 cases were tracked, jumping from an already active 81 first quarter cases. The second quarter of 2008 had just 42 cases. Continue reading “Appraisal, Loan Modification and Foreclosure Lawsuits Soar

Bill in congress to stop HVCC gains momentum

Dennis Norman

Dennis Norman

By: Dennis Norman 

Since going into effect May1st the new Home Valuation Code of Conduct (HVCC) has caused controversy, been blamed for killing sales and seems it has everyone up in arms.

In late June I did a post on another blog about a bill,  H.R. 3044, that was introduced in the U.S. House of Representatives that, if passed, would put an 18 month moratorium on HVCC.

The bill was introduced by Representatives Travis Childers and Gary Miller.   Since being introduced the bill is gaining some support and momentum.  As of today there are 22 cosponsors that have signed on to the bill.  So far none of the representatives from St. Louis (or Missouri for that matter) have signed on yet but hopefully their support is forthcoming.

To see the representatives that have signed on as co-sponsors please click here.