Shrinking Appraiser Numbers – Industry Studies

The American Society of Appraisers (ASA) announce that it has merged with the National Association of Independent Fee Appraisers (NAIFA) and that it’s near 4,900-member appraiser base will increase by about 700 to about 5,600.  The organization will thus have about 1,400 real property members which is about 25% of its total membership.

How does that compare with the Appraisal Institute (AI)?  They currently have about 15,000 members, per a recent article, so ASA even with its additional real property members will have less than 10% of the AI’s.  The Appraisal Institute lost 3,000 members in 2017 which is more than twice the number the number of ASA real property appraisers.  The Royal Institution of Chartered Surveyors (RICS) has over 120,000 members world-wide.  Jonathan Miller has completed an article that details the recent decline in AI membership, the link is located below.

There are many articles on the Internet about the aging of appraisers and the ASA / NAIFA merger is in part due to that problem.  It’s also common knowledge that there will be fewer appraisers and fewer appraisal organizations as the number of appraisers continues to shrink in size over the next several years.

Part of what has contributed to their being fewer appraisers is the fact that few appraisers want to take interns and train new appraisers.  A 2017 NAR study, the “Appraiser Trends Study,” notes that appraisers; have worked for in the field for about 22 years, are unsatisfied with a number of job related factors.  Leading the dissatisfaction list are excessive regulation and insufficient compensation.

The NAR study asked about the acceptance of trainee work and not surprisingly relatively few appraisers indicated that clients would accept trainee work.  That says something about how valuable trainee work is to appraisers.  Most trainees expect, and most receive, compensation however the work generally needs to be reviewed, yet they noted that the training was too time consuming, too much work, not cost effective and not worth their time. 

The NAR study also revealed that appraisers report an average of 243.2 appraisals per year or about 20 appraisals per month.  They reported that a “standard property” took about 10.6 hours to complete but that a “unique or add lot” appraisal took 15.4 hours.  

Even the NAR study noted an average age of respondents at 54.5 years, and the study considered the timing of appraiser retirement as discussed in the Future of Appraisal: It’s Not Simple article referenced below. Discussed is the fact that nearly half of the 82,000 active appraisers will be retired in 10 years with possibly 20,000 leaving in 5 years.

I have expressed my opinion regarding how this significant shortage will be dealt with in the past having observed how the medical industry has dealt with doctor and nursing shortages.  You now have nurses acting as doctors and the entry barrier for new nurses has been pushed open.  I expect that there will be significant pressure to revise appraiser training downward and the lofty goals of the past will bend to the demand for new appraisers.  It’s clear that the current process is not working and will not replace those who retire over the next 5 to 10 years.

For more appraisal information contact Glenn J. Rigdon MA, MRICS, ASA is a Las Vegas / Henderson Nevada based appraiser who can be contacted via email or via his business website known as Appraiser Las Vegas  (http://www.appraiserlasvegas.com), or you can also click on “Contact Us” on the home page of this website or visit my public profile at LinkedIn at http://www.linkedin.com/pub/glenn-rigdon-ma-mrics-asa/1a/30b/879/

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http://www.millersamuel.com/appraisal-institute-membership-falls-sharply-as-asc-registry-levels-off/.

NAR Appraisal Trends Study

https://www.scribd.com/document/342075358/Appraiser-Trends-Study-03-16-17#download&from_embed

The Future of Appraisal: It’s Not Simple

http://economistsoutlook.blogs.realtor.org/2017/07/17/the-future-of-appraisal-its-not-simple/

Article source: http://www.appraisalarticles.com/General-Appraisal-Articles/Appraisal-Industry/4680-Shrinking-Appraiser-Numbers-Industry-Studies.html