Appraising appraisers

With the implementation of new regulations for Federal Housing Administration appraisals around the corner, Housing Watch looks at the industry, exposing the “seedy underbelly” of scheming, wheeling and dealing, according to Housing Watch. The glut of subsequent new appraisal management companies are an “accident waiting to happen,” according to Jonathan Miller, an appraiser himself and the CEO of Miller Samuel. While appraisal management companies — those whose job it is to create a buffer between lenders and appraisers — have become increasingly key to the industry, experts say that the managers, too, can be off-base. “The use of out-of-area appraisers, who don’t know the local market or have full access to the data, frequently results in apples and oranges comparisons in the valuations,” Walt Molony, a spokesperson for the National Association of Realtors, said. “The result is many valuations coming in below the price agreed upon between the buyer and seller, by definition, a fair market price.”