Blaming broker appraisals
May 29, 2009 10:30AM By Ken Harney
From the May issue: Are lowballed valuation estimates on short sales and bank-owned
foreclosures artificially depressing property values in neighborhoods
across the country?
Growing numbers of appraisers and consumer groups believe the
answer is yes -- and are demanding that either Congress or state
regulators crack down. Their complaints focus on what are called broker
price opinions, or BPOs, that substitute for actual appraisals.
Unlike standard property valuations performed by licensed
appraisers -- which can run to hundreds of dollars -- BPOs often cost $50
and are performed by real estate agents who may have minimal or no
appraisal training and are subject to no regulatory oversight. Realty
agents defend BPOs, arguing that their extensive knowledge of local
market trends equips them to render accurate estimates.
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Comments
Anonymous
It's not the brokers forcing the lower pricing, it's the asset management companies that refuse to accept valuations that exceed what their expectation of the property is. Once again, look to the banks for the problem.
Comment #1 Posted By: Anonymous 05/29/09