Data advances are putting RE appraiser jobs under threat

Computing breakthroughs could start rapidly killing off knowledge-based jobs

TRD New York /
Jul.July 11, 2017 01:15 PM

Zillow’s “Zestimate” feature

Real estate appraisers — the people who value homes before a bank hands out a mortgage — could be in danger of having their jobs wiped out by technological advances.

Just as farm workers lost jobs to machinery, and robots killed off factory-based work, automation is creeping into home appraisal. Zillow Group claims it has developed algorithms that can both gather facts about neighborhood values, but also more nuanced price indicators — like whether or not a living room has hardwood floors, Bloomberg reported.

“The future for appraisers specializing in residential mortgage work is coming to an end,” Brian Weaver of the appraisal licensing board in Illinois wrote in a recent newsletter to his peers, according to Bloomberg. “No bang. Not even a whimper.”

Mortgage financiers like Freddie Mac are starting to accept transactions that don’t have a human appraiser, according to the publication. Last month, the mortgage giant started allowing automated valuations for some refinancing loans, and will expand the process to some home purchases if the Federal Housing Finance Agency approves it.

A spokesperson for Freddie Mac said it will only allow the automated valuations for a small number of loans, and will not mean appraisers will become irrelevant.

However, the Appraisal Institute has written to regulators at FHFA saying, “Freddie Mac’s decision to veer away from fundamental risk management practices appears to harken back to the loan production-driven days in the years leading up to the 2007-2008 financial crisis.”

Last month, a homeowner filed a suit against Zillow, claiming the company’s “Zestimate” tool repeatedly undervalued her home, creating a “tremendous road block” to its sale. [Bloomberg]Miriam Hall


Related Articles

arrow_forward_ios
Eric Gordon

Eric Gordon on the evolution of the residential data game — and how to stay competitive in the new world

Big Tech locations in NYC

MAP: Here’s a look at all the Big Tech locations in NYC

What will proptech look like in 2019 and beyond?

From left: RealPlus' Eric Gordon, Corcoran's Pam Liebman, Halstead's Diane Ramirez, Douglas Elliman's Howard Lorber and Brown Harris Stevens' Bess Freedman (Credit: Eric Gordon by Emily Assiran, Getty Images, Halstead, BHS, iStock)

Terra sells part of RealPlus stake to Corcoran and Elliman

“I can talk about erections all day”: NAR tech consultant’s bizarre fireside chat

(Illustration by Andrew Colin Beck)

These highly leveraged real estate firms could feel the squeeze in
a downturn

Zillow CEO Richard Barton (Credit: iStock and JD Lasica via Flickr)

Not betting on iBuying would be an “existential threat”: Zillow CEO

Zillow seeks $1.1B cash infusion

arrow_forward_ios