While the central Kentucky real estate market has shown promising signs of improvement since the last recession, another important element of the local housing market, property appraisal, has been slower to recover.
C. Woodrow Wilson, owner of Wilson Appraisal Group in Harrodsburg, Ky., is a veteran real estate appraiser, holding a license since 1979. He spends much of his time holding classes to educate and train potential appraisers. But the field these appraisers are entering is fraught with upheaval and change that is creating a shortage of appraisers across Kentucky.
According to the Kentucky Real Estate Appraisers Board, the state has 1,528 licensed and certified appraisers, all regulated by federal law. The total has been as high as 1,900 in recent years, but the last recession and tighter lending practices have shrunk the real estate business and consequently the need for as many appraisers. While the real estate market is rebounding, the appraiser field might not be.
Real estate agents, mortgage lenders and buyers and sellers of homes and other property constantly deal with appraisers. Their work is essential in the transactions.
“They document physical, legal and economical characteristics of a property. They spend time in courthouses and measure, photograph and observe properties. They also observe the neighborhoods in which they set. They analyze data points like sales and listings to see how other people are behaving relative to that property. It’s really an analytical business,” Wilson said.
Currently, the statewide total of appraiser candidates includes 198 associates or trainees who must undergo 90 hours of classroom education before taking a fairly rigorous national exam to enter the field. After that, there is an apprentice-type program in which a new appraiser must find a sponsor willing to monitor their work for a minimum of two years.
Here’s another eye-opening statistic that might also explain shortages: The average age of an appraiser is 55 to 60.
“We’re an aging profession,” said Larry Disney, executive director of the Kentucky Real Estate Appraisers Board. Disney said fewer young people want to make appraising a career.
“Some people have appraised for many years, like me. I began in 1977. For many, it’s a second career, like real estate sales. They’re retired from other jobs, like the education field,” Disney said.
The state board attempts to reach out to Kentucky colleges to make administrators and students aware that appraising is a beneficial profession with good income potential. “But we have a hard time reaching them. It just doesn’t have the same pizzazz as a Wall Street job,” Disney said.
With only 198 associate/trainees in the statewide pipeline, many of them older, there may not be enough new appraisers entering the system to meet future needs.
Another issue is the time required to become an appraiser. Appraisers won’t make much money until they complete their education, training and field experience, usually in hundreds of hours spread over two to three years.
One associate appraiser, who is being trained by his father to eventually take over his Georgetown practice, said the system is set up so there isn’t much incentive for a veteran appraiser to sponsor an associate during the apprentice period.
“Appraisers ask why they should take on somebody for two to three years, only to see them take the test and go and hang a shingle two doors down from them. They become your competitor and also have inroads into all your clients,” said associate appraiser Roy Cornett.
Wilson, however, thinks complaints like those don’t always “square with reality.”
“That attitude has existed among some people for a long time, and it’s one you hear a lot,” he said.
Wilson said his training classes are often sold out. “From the perspective of our school, I don’t know of any student who completed their education and wasn’t able to be placed,” he said. “I don’t know if that’s a function of skill, ability or marketing. Our office stays busy; that’s all I know.”
Wilson urges those who wish to become appraisers to develop relationships with fully certified appraisers and explain that after getting trained, they’d like to work with them. “When you start your education, get out and talk to certified appraisers in the markets you want to work,” he said. “It’s not a matter of walking through the door and saying ‘I have an associate’s license; now it’s your turn to hire me.’ It takes a longer relationship. It’s not a free ticket.”