_Sounding Bored is my semi-regular column on the state of the appraisal profession. We will have additional columnists soon (and frankly, as the webmaster, I got jealous of all the cool graphics my colleagues get to use with their posts). This week I discuss whether appraisers are the right choice to help sellers price properties for sale._
Well, not really. Without a real estate broker or real estate appraiser doing the analysis, who else is available to the seller for help pricing their property?
In Doug Heddings recent post, [Pricing: Why Not Just Hire an Appraiser? [True Gotham]](http://www.truegotham.com/archives/a-brokers-job-111-pricing-why-not-just-hire-an-appraiser.html) he argues against using an appraiser for pricing a property. He says:
_In theory, that’s a great idea. But over the last seven years, as the market has been rising, appraisals have often fallen short of conditions on the ground–meaning that you’re leaving money on the table if you leave the pricing to an appraiser._
He suggests sticking with a good real estate broker. But what defines a good broker if you are new to the market? While I would recommend Doug as one of the top brokers out there, what if you didn’t know that?
His post was inspired by a recommendation he read in Marshall Loeb’s Marketwatch column [Price Your Home Right
To Help Speed a Sale](http://www.realestatejournal.com/buysell/tactics/20060519-loeb.html).
Doug makes the argument that, since so many appraisers in New York rely on brokers for listing information, why not go to the broker first? Listings are an important component for pricing, especially now with marketing times expanding. However, some appraisers have access to the same listing information (ie, me).
I actually, agree with his argument against using typical appraisers, espcially those that came out of the wordwork during the recent housing boom, but its based on the same argument that could be made against relying on a real estate broker for pricing which, like his anti-appraiser argument, is based on dated stereotypes.
Even Marshall Loebs comments are dated. The idea that we look at 3 or 4 “comps” in the area in the past 6 months is just silly. We look at sales, contracts and listings in the immediate area – properties that would have or will compete with the subject property. Often we have access to more accurate information than the broker does.
I teach real estate appraisal classes to brokers in a variety of venues and I am always struck by the impression our industry makes on real estate brokers. To most brokers, their only interaction with an appraiser is made during a sales transaction, when the bank sends the appraiser, often from outside market areas because they are cheaper, can crank out the report fast, etc. In otherwords, most of the appraisers that brokers interact with are simply _[form-fillers [Soapbox]](http://soapbox.millersamuelv2.wpenginepowered.com/index.php?s=form-fillers)_, and not true appraisers. I sound a bit harsh on this type of appraisers, but this has been a sore-spot of mine for the past decade.
So the bottom line is that all comes down the the individual real estate professional to provide pricing advice. Here are the arguments:
* Use a broker for pricing – they have an inherent bias toward selling the property built into their relationship with it as a commissioned agent. They are paid only if the property sells. Sellers are often uncomfortable with this fact, whether unfounded or not, for the particular broker to be able to provide unbiased advice. Plus, they may not specialize in a particular market area that they are asked to sell. _Therefore it all comes down to the skills of the individual broker for pricing._
* Use an appraiser for pricing – many are simply not competent in the particular market they are asked to perform an assignment for. They may not know the individual market as well as a particular broker who specializes in it. When our firm performs appraisals for relocation assignments, in the past we have been rated and +/- 3% of the final sales price even though our results are affected by competancy of the brokers that are asked to sell the property. _Therefore it all comes down the the individual appraiser._
Go with who you think is the most competent and who you feel comfortable with. Both Doug and I are not being self-serving here, because there is no right answer.