The Real Deal New York

From the July issue: Appraisers — even compared to other real estate professionals — took a severe beating during the real estate downturn. And while the housing market just might be coming off the ropes to fight another round, the appraisal industry is still down on the mat. In fact, some professionals worry the shrinking industry may be in for even more dire straits ahead, thanks to new types of mortgage fraud (see sidebar, “‘House-flopping’ on the rise”) and new regulations.
“The sad thing is that there are many good appraisers who simply can’t afford to do business anymore,” said Jonathan Miller, CEO of appraisal firm Miller Samuel.
It’s now widely known that the housing crisis revealed systematic failures within the appraisal industry: Too-cozy relationships between brokers and banks habitually pushed appraisers to render higher-than-market appraisals. But legislation aimed at restoring the independence of appraisers only created new problems, leading some appraisers in New York City and elsewhere to deliver below-market estimates of properties’ value.
Now, those who have worked in the industry for years say it has been permanently altered. [more]