Appraiser

Detailed Definition

An appraiser is a professional who is qualified to provide an unbiased opinion on the value of real estate properties. These individuals play a crucial role in determining property values, which is essential for real estate transactions, mortgage lending, tax assessments, and legal proceedings among other purposes.

Types of Appraisers:

1. Certified General Appraiser:

   • Qualified to appraise any type of real estate.
   • Requires extensive education and experience.
   • Generally tackles more complex properties like commercial real estate.

2. Certified Residential Appraiser:

   • Focuses on residential properties with up to four units and vacant lots.
   • Requires less experience than a Certified General Appraiser but still needs substantial education and examination.

Requirements for Certification:

• Education: Coursework in property valuation, math, economics, and legal aspects of real estate.
• Experience: Supervised hours of practical experience in real estate appraisal.
• Examination: Passing a state-administered written exam.
• Continued Education: Maintenance of certification usually requires ongoing education to stay current with industry standards and regulations.

Professional Organizations:

• Appraisal Institute: Known for the MAI (Member, Appraisal Institute) for income properties and SRA (Senior Residential Appraiser) for residential properties.
• American Society of Appraisers: Provides credentials across various appraisal disciplines.
• International Association of Assessing Officers
• International Right of Way Association
• National Society of Real Estate Appraisers
• National Association of Master Appraisers
• American Society of Farm Managers and Rural Appraisers

Examples

1. Home Purchase: When buying a home, an appraiser assesses the market value of the property to ensure that the sale price is fair and accurate.
2. Refinancing: An appraiser evaluates the property to help determine if the homeowner qualifies for refinancing.
3. Legal Disputes: In legal disputes such as divorce settlements or bankruptcy proceedings, an appraiser can provide expert testimony on property values.

Frequently Asked Questions

What is an appraiser needed for?

An appraiser is essential for determining the market value of a property, which is crucial for transactions, legal cases, tax assessments, estate planning, and mortgage approvals.

How do you become an appraiser?

Becoming an appraiser involves meeting specific education requirements, acquiring supervised experience, and passing a standardized examination. Continuous education is also required to maintain the certification.

What is the difference between a Certified General Appraiser and a Certified Residential Appraiser?

A Certified General Appraiser is qualified to handle all types of real estate, while a Certified Residential Appraiser specializes in residential properties with up to four units.

How often does an appraiser need to renew their certification?

Most states require appraisers to renew their certification periodically, often every 2-3 years, and complete continuing education during this period.

What impact does an appraiser have on real estate transactions?

An appraiser’s assessment can affect the final sale price of a property, the amount of loan a buyer can secure, and in some cases, whether a transaction goes through or not.

Related Terms

• Market Value: The estimated amount for which a property should sell on the open market.
• Underwriting: The process by which bankers evaluate the risks of a proposed mortgage.
• Depreciation: The reduction in value of an asset over time, often applied to buildings (but not land).
• Fair Market Rent: The amount that a property would command within an open and competitive market.
• Income Capitalization Approach: A method used by appraisers to value property by converting expected income into value.

Online Resources

• Appraisal Institute
• The Appraisal Foundation
• American Society of Appraisers
• International Association of Assessing Officers

References

1. Appraisal Institute. (n.d.). Retrieved from Appraisal Institute
2. The Appraisal Foundation. (n.d.). The Appraisal Foundation

Suggested Books for Further Studies

• “The Appraisal of Real Estate” by Appraisal Institute
• “Real Estate Appraisal: From Value to Worth” by Andrew Baum
• “The Student Handbook to the Appraisal of Real Estate” by Appraisal Institute
• “Marshall & Swift Valuation Service” by CoreLogic
• “Residential Property Appraisal” by Harris Annul

Real Estate Basics: Appraiser Fundamentals Quiz