1 / 10

The Future of Residential Appraisal – The AVM Dilemma

Appraisal Today Conference San Francisco August 6, 2004 Vicky Cassens Zillioux Managing Director. The Future of Residential Appraisal – The AVM Dilemma. In the Beginning…. Automated Valuations – They have been around longer than we think

Download Presentation

The Future of Residential Appraisal – The AVM Dilemma

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Appraisal Today Conference San Francisco August 6, 2004 Vicky Cassens Zillioux Managing Director The Future of Residential Appraisal – The AVM Dilemma

  2. In the Beginning… Automated Valuations – They have been around longer than we think • County Assessors have been using these products for many years • First developed to accurately value homes for tax purposes • Accuracy was important to eliminate time and money spent on reassessments due to homeowner appeals • Models were developed on a county basis with much of the necessary information readily available as model inputs • Neighborhood idiosyncrasies were identifiable due to limited geographical coverage • This is not really an appraiser issue

  3. Price Index Models Make the Scene University research brings the development and use of price index models • CSW – the Wall Street Model • MRAC – also targeted wall street • Price Index modeling addresses the issues of limited data available to the commercial enterprises • Primary focus was for portfolio valuations in the investor community • Not yet introduced into lending • This is still not an appraiser issue

  4. Automated Valuations Move into Lending The first models are developed for the residential lending market in California – early to mid 1990’s • Initial models are “hedonic” • Initial take on price index models is that they are not accurate enough for individual valuations • First American develops Value Point • More like appraiser emulation with regard to comparable choices and radial searches • HNC develops AREAS • Neural network model that attempts to identify neighborhoods and improve comparable search methods • Much of the time was spent selling the concept rather than the products • Now its becoming an appraiser issue

  5. Not Always an Appraisal Replacement Models are being used in all parts of the lending process… • Prequalification • First Mortgage (portfolio lending) • Home Equity • Wholesale review • Quality control • Default and foreclosure • Portfolio valuation tracking • Internet marketing

  6. The Reality Check AVM’s are here – Like it or not • Only the monopolies get to win the fight • AT&T and the Gopher search engine • So what happens now? • What are the choices? • Forget about it and go on with the way you are doing business • Complain about it and go on with the way you are doing business • Find out what your clients are doing • Figure out what the appraiser related tools are

  7. How Many AVM’s are Out There today? Sizing up the competitive market • There are 15+ AVM models out there today • ValuePoint 4 – First American • Basis 100 – Now First American • ValueSure – Fidelity • CSW – Fiserv • Value Wizard– Trans Union/Banton • HVE – Freddie Mac • MRAC – Basis 100/First American • ValueFinder – Landsafe/Countrywide • Do you see the trend here….. • Q-Value – Real Info • VeroValue – Veros • Net-Value – C&S Marketing

  8. Understanding Your Client Do you know who your client is? • Do you know what they need in today’s market? • Do you understand their competitive environment? • Mortgage broker? What does he need? • Lender? What does he need? • Borrower? What does he need?

  9. Understanding Your Market Do you know… • What the Fitch press release said about AVM’s • What everyone else said about the Fitch press release • What the leading mortgage publications are that will give you information about the lending industry • Which appraisal chat websites are worth the time and which are not • Who the current appraisal management companies are and what they can offer • What appraiser assisted AVM products are out there • What is going on out there in the lending community

  10. Who Gets to Win? There doesn’t have to be only one winner… • How have you handled competition in the past? • Customer service – quality work, fast turnaround • Client relationships • Understanding customer needs • Is this really so different? • Professionalism – understand the big picture in the industry • Everyone needs to move with their market – As a client, how do you expect your doctor/dentist/accountant/attorney to react to technology in their market?

More Related