Thank you and good luck in 2012
I would like to take this opportunity to tell you, the members of the New York State Society of Real Estate Appraisers, what an extraordinary opportunity it has been to serve as your 2011 president. This year has brought many trials and tribulations, and yet, we have made significant progress and accomplished some substantial goals. I want to thank you for all your support along the way.
I leave you with an extremely capable and knowledgeable leadership team for 2012. Congratulations to incoming President Anthony P. Girasole, President-elect David Fuller and Secretary/Treasurer Dan DiSanto. I have no doubt they will guide you in the right direction and I wish them the best of luck for the ensuing year.
I would also like to introduce to you the incoming governors for 2012. They are: George K. Wonica, Staten Island; Jim Knight, Buffalo Niagara; Christina Daniello, Rockland County; Joyce Royal, Fulton County; and Gail Gladstone, Long Island. Congratulations to this experienced crew.
We have advanced a few initiatives that the succeeding leadership team will continue to develop. As most of you are aware, this society has a strong focus on education. It is our mission to again bring you courses across the state specific to the appraisal industry and helpful to your practice. Please keep an eye out for upcoming education offerings in your area. Along the same lines, we are attempting to offer the 18th Annual Arthur G. McCartney Spring Appraisal Conference in Long Island this year. We will post this information on NYRealEstateAppraisers.com when it becomes available.
Don’t forget we have education scholarships available to help subsidize your attendance and defray the cost for our courses and conferences. You can get an application on NYRealEstateAppraisers.com or contact Pam Morrison at the NYSSREA offices.
Mandatory licensing has been a longtime initiative for NYSSREA and it was a topic of discussion at the last New York State Appraisal Board meeting. Please see the minutes below for more information.
Our next board meeting will be held on Monday, February 13, 2012, at the Desmond Hotel and Conference Center in Albany, NY. Please join us for committee meetings at 10a.m. to discuss industry topics, society matters and upcoming events. I hope to see many of your there.
One final note, please make sure you go to our Facebook page and “like” us!
2011 NYSSREA President
NYSSREA committees meet in Verona
On Sunday, September 11, committees of the New York State Society of Real Estate Appraisers met at The Turning Stone Resort and Casino in Verona, NY. President Steve Roefaro welcomed the Board of Governors and a motion was made, second and carried to approve the minutes of the February board meeting.
Secretary/Treasurer David Fuller presented the treasurer’s report and reviewed the financials. After a lengthy discussion, a motion was made, seconded and carried to increase membership dues to $80 in 2012.
Education Committee Chair Becky Jones discussed the Spring Conference. A motion was made to create an ad hoc committee to examine the viability of the program and the details of the next conference.
The Scholarship Committee reviewed and approved one application for $300.
Communications Committee Chair Dan DiSanto called for E-newsletter article ideas. A motion was made to create an ad hoc committee for social media and networking. The members will be George S. Wonica, Jim Knight, Becky Jones and Jennifer Dindl-Neff.
Marketing Committee Chair George S. Wonica reviewed the NYSSREA website and asked staff for analytic information regarding site visits, and to post sponsor logos and information on the site.
Nominating Committee Chair George S. Wonica presented the proposed slate of officers and governors for 2012. The slate is as follows:
President: Anthony P. Girasole, Buffalo Niagara
President-Elect: David Fuller, Northern Adirondack
Secretary/Treasurer: Dan DiSanto, Ithaca
Governors with terms to expire in 2014:
George K. Wonica, Staten Island
Jim Knight, Buffalo Niagara
Christina Daniello, Rockland County
Gail Gladstone, Long Island
One year term to expire in 2012:
Joyce Royal, Fulton County
A motion was made, seconded and carried to approve the slate of officers and governors as presented.
With no new business, the meeting was adjourned.
to view the minutes from the Board of Governors meeting in their entirety.
National Association of REALTORS Appraisal Committee meets in Anaheim
The National Association of REALTORS Appraisal Committee met November 11, 2011 during the NAR REALTORS Conference and Trade Expo in Anaheim, CA. The following are the actual minutes from the meeting:
The Appraisal Committee formed a recommendation that NAR adopt the Responsible Valuation Principles as drafted by the Valuation Workgroup.
Rationale: In 2011, the Valuation Work Group was convened in part to help National Association of REALTORS (NAR) begin taking a comprehensive approach to adopting policy as it affects the valuation of real property. The Work Group crafted principles designed to serve as the foundation of valuation policy for NAR going forward. NAR understands that credible and accurate valuations are necessary for a vibrant real estate market nationally and in your community.
The Valuation Work Group was comprised of members from relevant committees with an interest in real property valuation; the Appraisal Committee, Federal Housing Policy Committee, Conventional Finance and Lending Committee, and the Business Issues Committee. The Work Group worked through several versions of the principles paying particular attention to detail. Recent legislation (Dodd-Frank Act) and federal rules (Interagency Appraisal and Evaluation Guidelines and Truth in Lending; Interim Final Rule) make this comprehensive approach important because appraisals and non-appraisal evaluations are recognized as appropriate for different circumstances.
Rather than being reactive, NAR is prepared to be a leader and the only organization positioned to be an advocate for accurate, credible, and independently developed valuations of real property. While others advocate for specific valuation products, only NAR has a legitimate interest in all of them. NAR’s agents and brokers provide broker price opinions and comparative market analyses. NAR’s appraiser members provide appraisals. NAR’s affiliate, REALTORS Property Resource (RPR), offers an automated valuation model.
Recommendation Update: This recommendation was amended by the Executive Committee, and that amendment was approved by the Board of Directors on November, 14, 2011. The Executive Committee recommended that the Responsible Valuation Principles put forward by the Appraisal Committee for adoption by NAR be sent back for further review by a work group comprised of members of the 2011 Valuation Work Group, Appraisal Committee and Professional Standards Committee. As the Valuation Principles reference NAR's Code of Ethics Standards of Practice, additional time and study by Professional Standards of this proposed policy is recommended to ensure no conflicts with the Code of Ethics.
1. In addition to reviewing the recommended Responsible Valuation Principles, the Valuation Work Group also was directed to discuss the creation by NAR of a broader-based “Valuation Committee” comprised of appraisers, brokers and members engaged in other real estate disciplines. After deliberation on numerous conference calls, the recommendation was made to the leadership team to transition the Appraisal Committee to a more all-encompassing Real Property Valuation Committee. The leadership team approved the new committee structure, which will be voted upon by the Board of Directors (approved by BOD on 11/14/11).
2. Jeff Young and Marty Frame of REALTORS Property Resource (RPR) provided an update on the new appraiser tools that will be available in January 2012. A number of the Appraisal Committee members have served on an RPR Appraisal Work Group and reported that the tools are user friendly and will provide a tangible benefit for appraiser members.
3. Staff provided a legislative/regulatory update on the following appraisal-related issues: Senate Bill 1746, Visit USA Act; Uniform Appraisal Dataset (UAD); new resource at REALTOR.org of a comprehensive database of appraisal requirements; and regulation of appraisal management companies (AMCs).
4. The Appraisal Foundation (TAF) representatives, Dick Koestner for TAF's Advisory Council (TAFAC) and Vic Knight for TAF's Board of Trustees, provided updates. These updates included a new TAF consumer brochure, "A Guide to Understanding a Residential Appraisal,” which NAR plans to distribute to its membership.
5. A marketing piece on the benefits of REALTOR membership for appraisers will be created to attract non-member appraisers to NAR. New benefits for appraisers were also discussed.
6. The Professional Development Committee's Interpretation and Procedures Subcommittee met this fall and reviewed the Appraisal Committee's recommendations for an appraiser-specific quadrennial Code of Ethics course. The subcommittee accepted the recommendations and board policy staff will review staffing and budget next year to determine when this new course could be developed
NYS Board of Real Estate Appraisal meets in Albany; NYSSREA president elected as chairman
The New York State Board of Real Estate Appraisal meeting was held Friday, September 23, 2011, at the Department of State in Albany, NY and included a video conference with the New York City office. Stephen Roefaro was elected as chairman. A motion was made, seconded and passed for DOS to proceed with legislation requiring mandatory licensing.
New business items include the adoption of the 2012-2013 Uniform Standards of Professional Appraiser Pracice (USAP).The requirement by the Dodd-Frank Act to require Appraisal Management Companies (AMC) to be licensed was also discussed.
Apply for the NYSSREA John J. Noto Scholarship Award by January 31
In an effort to stimulate interest in the challenging, complex and ever-changing profession of real estate valuation, NYSSREA is offering scholarships of up to $300 to be used for NAR Appraisal courses sponsored by NYSSREA/NYSAR or a local board/association, or for the Appraisal Institute courses. The money can be used toward room and board, books and tuition.
Applicants with main offices in New York must have one year experience in real estate appraisal, brokerage, development and other related disciplines, and/or hold an appraiser assistant license. The applicant must show positive motivation toward real estate appraisal education and must have completed at least one real estate-related course acceptable to the Society within the last five years.
Applicants must send in a completed application, transcript or evidence of satisfactory completion of real estate and/or appraisal course and a brief biography sketch by January 31, 2012 to:
New York State Society of Real Estate Appraisers
130 Washington Avenue
Albany, NY 12210-2220
for an application and additional information.
NY Attorney General cleared to pursue appraisal scams despite federal law
As published in the New York Law Journal on November 23, 2011, the case of People, by Cuomo v. First American Corporation, 184, the New York State Supreme Court finds there is nothing in federal law to prevent New York’s attorney general from pursuing allegations that real estate appraisers engage in fraudulent and deceptive business practices.
In 2007, then-Attorney Gen. Andrew Cuomo alleged that First American allowed the manipulation of appraisal values to allow loans from Washington Mutual Inc. to proceed to closing.
First American and eAppriaserIT maintained that their estimates were valid and argues that the state action was barred by a series of federal laws including the federal Home Owners’ Law Act of 1933. They argued that these laws are reserved for the federal government.
The court found that these lows do not pre-empt states from enforcing such laws as New York Executive Law §63(12) or General Business Law §349, which were both cited by the state and then-Attorney General Cuomo as allowing the attorney general to challenge appraisal practices.
The Appraisal Foundation responds to NAHB allegations that flawed appraisals are hurting the housing market
Recently, John Brenan, director of appraisal issues of The Appraisal Foundation submitted a letter to the National Association of Home Builders (NAHB) in response to their press release stating “faulty appraisal practices” that compare foreclosed sales to new home values were driving home prices down and thus hindering the housing market from recovering.
The letter defends current appraisal practices and explains that appraisers do not determine property values; they simply reflect the actions of buyers or sellers in the marketplace to produce a credible opinion of value.
The letter goes on to explain key concepts and principles of appraisal practices that force appraisers to consider comparables that are not physically similar, but none the less reflect the actions of buyers or sellers.
Most importantly, the letter reminds NAHB that all state licensed and certified real estate appraisers in the U.S. are required by the Uniform Standards of Professional Appraisal Practice (USPAP) to be independent, impartial and objective, and to perform assignments without bias.
Click here to read the entire letter and the original NAHB press release.
NAR member guide now available
The National Association of REALTORS is pleased to announce that your member guide is now available online. The guide highlights the core membership value and benefits provided by all three levels of the REALTOR family – all in a convenient and personalized format.
The NAR Member Guide now includes the following features:
• Personalized information based on your NRDS membership ID #.
• Up-to-the-minute news, information and events from your Local, State and National REALTOR Associations.
• FREE iPhone and iPad apps available in the App Store.
• Customizable NAR membership card, available for digital display on your smartphone and for printing directly from a computer. You can also order a plastic card – personalized with your name, NRDS ID and designations and certifications on your selected card background – for only $5.00 (includes shipping & handling).
• At-a-glance benefits information, which links to REALTOR.org for more detail.
Access your Member Guide at http://MemberGuide.REALTOR.org. Simply log in with your NRDS ID and last name to get started.
To better personalize your Member Guide experience, be sure to update your NRDS profile and primary fields of business.
NAR and the entire REALTOR family are committed to your continued success. Access the Member Guide today and discover the full range of value and benefits available to you, and visit throughout the year to stay current of the latest benefits and programs available to you as a REALTOR.
USPAP Q&A Q
: I have heard that Advisory Opinion 13 (AO-13), Performing Evaluations of Real Property Collateral to Conform with USPAP, will not appear in the 2012-13 edition of USPAP. Does that mean that the ASB no longer intends to offer guidance on performing evaluations in conformance with USPAP for regulated institutions?
A: No. The advice that appears in AO-13 as it was presented in 2010-11 edition of the USPAP document was provided to assist appraisers in understanding and complying with the Interagency Appraisal and Evaluation Guidelines that had been issued on October 27, 1994.
Those guidelines were superseded by revised Interagency Appraisal and Evaluation Guidelines issued on December 2, 2010. As a result, the ASB will be working with the Interagency Work Group to update AO-13 to provide meaningful guidance on this more recent edition of the guidelines. The ASB intends to expose proposed revisions to AO-13 as soon as possible, and expects to issue an updated version of AO-13 prior to the effective date of the next edition of USPAP on January 1, 2014.
In the interim, appraisers are urged to review the revised guidelines by clicking on the following link to The Appraisal Foundation website:
Q: A client has asked me to disregard any foreclosure, real estate owned (REO), or short sales when performing market value appraisal assignments. Is this an acceptable assignment condition?
A: No. USPAP does not specifically address which sales should or should not be considered in an appraisal assignment. However, in real property appraisal assignments, Standards Rule 1-4(a) requires:
When a sales comparison approach is necessary for credible results, an appraiser must analyze such comparable sales data as are available to indicate a value conclusion.
So, the appraiser must determine what data is relevant.
There are many appraisal assignments where, in order to achieve credible results, it is necessary to use “distress” (e.g., REO or Short Sales) properties as comparable sales. However, foreclosure sales, defined by Black’s Law Dictionary as “the sale of mortgaged property, authorized by a court decree or a power-of-sale clause, to satisfy the debt” are seldom based on market expectations. When there is a glut of distress sales in the marketplace, and those properties are truly comparable to the subject, it would be misleading not to use them as part (or in some cases all) of the basis for a value conclusion.
A client-imposed requirement to disregard data that may be relevant and necessary for credible assignment results would be an unacceptable assignment condition.
Q: If I performed an appraisal that was “subject to” completion of repairs, completed, am I required to disclose that I previously appraised the property even if it is obvious to the client that I’ve done so?
A: A “Final Inspection” is not an extension of the original assignment unless it is part of the original agreement for services. A subsequent request would be a new assignment and as such requires disclosure in accordance with the Conduct section of the Ethics Rule. This holds true even if it may be obvious to the client that you’ve already previously performed an appraisal on the property.
Q: If I perform an appraisal and use a property as one of my comparable sales, and later receive a request to appraise the property that was used as a comparable sale, must I disclose I “performed a service” on that property because I used it as a comparable sale?
A: No. Using a property as a comparable sale in an appraisal does not constitute “performing a service” regarding that property. Therefore, a subsequent request to appraise the sale comparable would not require disclosure under the Conduct section of the Ethics Rule.
Q: I am involved in many aspects of the real estate industry. As such, I “perform services” on a great number of properties in many different ways. It would be very difficult for me to recall each and every property I’ve performed services on in a three-year period. Is it permissible to comply with the disclosure requirements by saying something to the effect of, “To the best of my knowledge?”
A: Such language does not need to be added, since the certification begins with “I certify that, to the best of my knowledge and belief:”
The Conduct section of the Ethics Rule recognizes that an appraiser may not always recall performing services on a property prior to being engaged in the assignment, which is why the requirement states, in part:
If known prior to accepting an assignment, and/or if discovered at any time during the assignment,
an appraiser must disclose to the client…
Appraisers are encouraged to review their record-keeping procedures and make any necessary modifications to assist them in promptly recognizing any property for which they provided services within the prior three-year period.
Q: I perform residential real estate appraisals using “standard” pre-printed appraisal forms, such as those developed by Fannie Mae. I’ve heard that Fannie Mae does not allow any changes to their certifications, so how can I comply with the USPAP requirement to disclose, in the certification, any prior services I have or have not performed on the property within the prior three years?
A: Fannie Mae does not prohibit additional certifications to their appraisal forms, as long as those additional certifications do not conflict with or diminish the “standard” certification items appearing on their forms. Therefore, appraisers may create an additional certification to comply with the obligations of the Conduct section of the Ethics Rule.
Q: I am aware of some appraisers who perform property tax assessment appeal assignments where their fee is based on a percentage of the tax savings to the property owner. Doesn’t USPAP prohibit appraisers from accepting assignments where the fee is based on a specific outcome?
A. Yes. The Management section of the Ethics Rule states, in part:
An appraiser must not accept an assignment, or have a compensation arrangement for an assignment, that is contingent on any of the following:
1. the reporting of a predetermined result (e.g., opinion of value);
2. a direction in assignment results that favors the cause of the client;
3. the amount of a value opinion;
4. the attainment of a stipulated result (e.g., that the loan closes, or taxes are reduced); or
5. the occurrence of a subsequent event directly related to the appraiser’s opinions and specific to the assignment’s purpose.
However, it is important to remember that USPAP applies to individuals only when they are acting as appraisers. An individual who provides some services as an appraiser may also act in a different role when providing other services. If the individual in this question is not preparing an appraisal or otherwise acting as an appraiser, he or she may work as an advocate in the tax appeal case. The only requirement would be that the individual not misrepresent his or her role.