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As a real estate appraiser, you could be running an independent business. So quicker the turnaround, the more appraisal reports you can complete, and the greater your business revenue.
However, even if you are looking to be time efficient, you should never compromise the accuracy and quality of the appraisal. After all, regardless of whether your client is a homeowner/seller/lender/investor, they are all relying on your assessment in making a major financial decision.
Whenever I ordered an appraisal before purchasing an investment property, I usually could get the report within a day or two. I always wonder how much time an appraiser really put into my appraisal report and what the actual steps involved are.
So last week, I connected with Timothy S. Evans, an experienced and highly respectable Certified General Appraiser in Michigan. He shared the workflow of a recent appraisal he completed, the steps from start to finish, and the time it takes for each step.
I’m sure this will give you a better understanding of the process and hopefully be more time-efficient in your next appraisal report.
Let’s check out the steps and time Timothy took to complete an appraisal
” I have a report that needs to be to the attorney by Monday so I needed to write the entire report myself instead of using an assistant to do some of the work.
I thought I would time myself to see how long it took to do everything from beginning to end.
I use a tablet for inspections so a lot of the property information was entered at the time of inspection. I don’t use my tablet to sketch (I still use graph paper) but if I did use a table for sketching this one had a bunch of bushes and such and I only have two hands so I would have put it on paper anyway.
This property is a simple house in fair condition and is being appraised for divorce purposes.
This is what I did today for this assignment:
- Sketch property,
- Fill in pertinent information about property that wasn’t entered at the inspection.
- Narrative about the condition of the property, the site, the neighborhood, etc.
- Picked out comps, pulled assessor records for the comps.
- Called one or both Realtors involved in the sale to confirm.
- Entered comp data for five of the seven comps picked.
- Made adjustments and reconciled value.
- Filled out my addenda, put narrative about the comps in the addenda. Put Highest and Best Use narrative in the addenda.
Total time today: 5 hours.
Time last week for inspection:
Drive to subject: 20 minutes
Inspection: 60 minutes
Drive home from inspection: 20 minutes
Time driving comps: 0 (Not in my scope of work). If I did have to drive comps for this one it would have taken about an hour.
Report is 46 total pages.
Total time for simple house appraisal: 6 hours and 40 minutes. “
– Timothy S. Evans, SRA, Certified General Appraiser at Monroe Valuation, Inc
Is this a typical result?
To further verify whether this is a typical case for other appraisers as well, I created an online poll at an appraisal group trying to find out the average time it takes to complete a full appraisal report.
Note that I specify this is for a simple house and not a desktop appraisal.
As you can see, the most selected response is that it takes an average of 5 to 7 hours to complete an appraisal report, which aligns with Timothy’s case study of 6 hours and 40 minutes.
Several appraisers also agreed with Timothy’s case study. An appraiser from Baltimore, Maryland, said that he has been in the field for 20 years, and his production remains consistently at one report a day. He believes that the days of completing 3-4 appraisals a day are long gone.
Another appraiser said that although there are peers who claim they can submit the report within hours, the work quality was really compromised.
Due to the stringent regulatory requirement, I also believe it really takes time to do it right.
Does it worth it?
So if it takes 5 to 7 hours on average to complete an appraisal, can the fee justify such an amount of work?
I asked Timothy personally, and he explained that fees are regional. For example, appraisal fees in WA and CO could be a lot more than when compared in the Midwest. (You could find the average appraisal fee by state here)
Although he didn’t reveal the exact appraisal fee for the case, I asked him whether he is making $400 to $600 per report. He confirmed that he is earning a very high end of it, as his typical appraisal works are used for legal purposes.
In the above example, his report was submitted to an attorney for a divorce settlement. However, some appraisers haven’t prepared themselves to up their game to do litigation work.
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The bottom line
Keep in mind that 5 to 7 hours per appraisal report is only an average figure. The time an appraiser spends on a report depends on the size and complexity of the property being appraised as well as the amount of research required.
For example, an appraiser expressed that it took her 56.2 hours on her last assignment because there were no subdivisions near her. They were all custom homes and extreme variations in everything from topography to view.
Generally speaking, simpler properties will take less time to appraise than more complex ones. Additionally, if an appraiser is familiar with the area in which the property is located, they will be able to complete the appraisal more quickly than if they were not as familiar.
Although it’s good to continuously look for ways to streamline the appraisal process, speed should not compromise quality. After all, your report’s accuracy can affect the livelihood of many parties.
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Disclaimer: The information in this post is for general information only, and not intend to provide any advice. They are subjected to change without any notice, and not guaranteed to be error-free. Some of the posts on this site may contain views and opinions from individual not related to JCHQ Publishing. They do not necessarily reflect our view or position.
