Just attended a great 2 hr talk on appraisals by an appraisal company sponsored by a local lender. Lots of great info on dealing with low appraisals and the problems causing them to happen in the first place.

Best info he talked about is how you as the Realtor can help prove your case with good CMA. He suggested learning statistical analysis to prove your case with lots of good data.

Has anyone taken any good classes on statistical analysis or used a good book to get the gist?

Appraisers have been in a pinch because of the view of who their actual customers are (the lenders). So if the Realtor can provide info to dispute the bad appraisal, the lender has to look at that too. He seemed to think it's only going to get worse and the more info we arm ourselves with, the better we will be prepared. Better learn Excel too. I'm pretty good with Excel so I just need to understand the basics of statistical analysis to at least get started.

We've seen this happen in our office this year more than once and kill the deals so I want to be better prepared when it happens to us. Also can help you convince the sellers what their listing price range REALLY is.

Thanks for the input navarac.

Funny you mention "in-contract" as the appraiser said they will look at those but wish they had more information as in what the actual sales price was, which can be difficult to get from the agent until the deal closes. He said that is really the most accurate comp they can use, but then some lenders will not allow that. That made for a lengthy discussion in our meeting that day.

Right. Which brings up yet another aspect of the full-time vs part-time argument. Full-time agents are able to attend broker opens and network with other agents in their local market. If you know your competitors personally, they will reveal contract prices prior to closing if you need the data for an appraisal. It's a matter of trust, and professional full-time agents who know each other generally share information like that.

Definitly get rid of the owners. Have the owners leave a plate of cookies and an envelope for the appraiser with 3% of what you want the value to come out as. No checks, cash.

You do not have to waste time with statistics. Appraisers need one thing when they arrive at the home. GOOD COMPS. Your job is to find good comparables from the immediate area that have sold within the past 6 months that are of similar design and appeal to your subject property. If there are no comps, then the appraiser has no comps, and you've got a problem. A problem that will not be solved with statistics.

Honestly, appraisers do not use statistics to evaluate a home. They use comps. It's all about the comps. Comps aren't everything, they are the ONLY thing.

You need recent sales of the same house as the one you are selling. If it's a Colonial, you need Colonials. If it's a Bi-Level, you need Bi-Levels. The homes that you select should be from the immediate neighborhood, if not then from a similar nearby competing neighborhood. Definitely must be in the same town and school district if you want them to be used.

If you pull a bunch of higher priced homes out of the MLS and give him a stack of non-applicable sales, you know what he is going to do? Throw them in the garbage and pick his own. In fact, if you try to hustle an appraiser with awful non-similar comps that are better than your home and/or are located in a better area, you will create hostility that will do nothing to help you.

The proper care and feeding of an appraiser mandates that you must make his or her job easier by researching the local market thoroughly and making sure he/she has the similar sales he/she needs to make the appraisal work. If your house oversold the market and there are no comps, you are SOL.

Another reason not to overlist. Even if you find a sucker, the appraiser will shut the deal down.

Finally, any agent who lets the appraiser do his job alone without meeting him at the house and supplying him with useful data is another example of a BAD AGENT. By the way, a favorite stupid part-time agent trick is doing the "day job" and letting the appraiser inspect the house alone and complete his report without giving him proper data to support the contract. BAD AGENT. BAD!

Top 10 Agent Activities to Make the Appraisal Come In At the Contract Price:

1) Get rid of the owner and the kids and the dogs during the inspection. APPRAISERS HATE DOGS! Get rid of them, lock them in the garage, tie them to a tree, whatever.
2) Give the appraiser a floor plan of the house, preferrably with dimensions.
3) Give the appraiser a legible copy of the sales contract
4) Give the appraiser a copy of the survey
5) E-mail him the interior photographs for his report, that is if you take good pictures. If you have a cheap camera and don't know an f-stop from a hole in the ground, then forget this tip.
6) Don't be late. Many appraisers will just leave if you don't show within 15 or 20 minutes. If they have to come back, it will not be with a positive attitude.
7) Be friendly, but do not hustle. Do not attempt to sell the appraiser the house. You will alienate an appraiser by attempting to influence value. Let the comps do the talking for you, be pleasant, and just stay out of the way.
8) Stage the house for the appraiser as if the home were being shown to a potential buyer. All the lights on, heat turned on, etc. While an appraiser is more sophisticated than the typical buyer, a tone can be set by proper presentation. A neat, warm, bright house will seem more like a house that has been well maintained and worthy of a "good" rating rather than "average" rating, which translates to condition adjustment dollars. It could make the difference between a problem and a smooth transaction.
9) If any sales in the neighborhood were non-representative of the market (divorce, estate, short, distressed), make sure the appraiser knows that. An appraiser will avoid artificially low, non arm's-length transactions. But he can only exclude them if he knows about the unusual circumstance.
10) Don't forget in-contract homes. Many appraiser will use a home that is "in contract" as supplemental information. If you have an in-contract home that sold a bit higher, it could help make the difference.

Part of the (lively) discussion at the meeting was who would divulge the sale price information to anyone, even the appraiser while under contract. We are full time and meet lot's of agents at broker's opens, lender events, MLS meetings, etc. but not sure if a competitive agent will share that info at any time.

One possibility to help this issue was that our local MLS is thinking of adding an agent comment area to post motivations of the buyer / seller after closing so an appraiser can weight the value of the final sales price. But that doesn't help when it's still in contract stage...

No, Navarac is NOT spot on. I don't know where you get some of this garbage, but it is obvious that many RE agents don't have a clue about an appraiser's duties under USPAP, HVCC, etc.

A listing agent has no business at all attempting to supply the licensed appraiser with comps.

An agent has absolutely no right to attempt to "make the appraisal come in at the contract price."
THIS IS CONSIDERED AN ATTEMPT TO INFLUENCE VALUE, AND YOU CAN LOSE YOUR LICENSE IF IT CAN BE PROVEN. ETHICALLY, AN APPRAISER SHOULD REPORT YOU FOR SUCH A BLATANT AND EGREGIOUS ACT.

Comps are the most important factor in a sales/market data approach appraisal, but they are not by any means the ONLY factor.

An appraiser MUST physically inspect the property and use his/her own photos, and cannot ethically accept any supplied by an agent.

The appraiser already has a copy of the sales contract supplied by the lender who hired him/her.

The appraiser is NOT employed by any agent/broker in the transaction, for lender appraisals, and MUST NOT take any actions that would give that appearance.

Honestly, I find it hard to believe that ANY licensed agent would make such blatantly unethical and erroneous statements about "the care and feeding of an appraiser." Have you forgotten all of your licensing materials and ethical duties? This mentality is absurd, and completely unethical. And you think you know what a "bad" agent is? The "good agent behavior" suggestions you've posted are completely convoluted ethics. This kind of influence was a big factor in enabling the mortgage fraud and predatory lending responsible for the real estate meltdown. This is precisely why we have regulatory agencies and state licensing boards. We have entered the twilight zone.