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The Value of Hiring a Professional Appraiser

July 10, 1994

In the June 26 "Real Estate Q&A" column ("How to Determine Asking Price for House"), Robert J. Bruss writes that a professional appraiser could be hired at a cost of several hundred dollars but the result would only be one appraiser's opinion.

Instead, he recommends interviewing three successful real estate agents working in the area and consulting friends, neighbors and business associates. The agents, he says, will provide written comparative market analyses showing sales and listing prices in the neighborhood.

What, one wonders, does he think the appraiser does?

The typical comparative market analysis that Bruss talks about is in fact a kind of off-the-cuff appraisal done by the broker, usually free, to obtain a listing. But it is almost never as rigorous as a professional appraisal.

A properly done appraisal is not just any opinion of value. It is based on recent closed sales in the neighborhood of homes that are as similar to the appraised property as the market offers, with research-based adjustments for unavoidable dissimilarities, and includes other research to identify market trends and other factors affecting value.

I have no quarrel with Bruss' advice about getting opinions from successful brokers. An agent who has concentrated on a particular neighborhood for some time should have a very good feel for values there. But one should never forget that everything an agent does is directed toward obtaining a commission. Once the seller is signed up for three to six months, an overpriced listing can be reduced.

The appraiser's job is to make an unbiased estimate of value based on the best information available. The fees he or she charges are highly competitive and cheap by comparison with almost any other professional service. Most residential appraisers make less than $15 an hour.

FREDERICK (ROB) COLE

President, Los Angeles Chapter,

National Assn. of Independent Fee Appraisers

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