The Intriguing Future of Appraisal Careers
The Vital Role of Appraisals
It's likely that if you've bought or refinanced a home, you've encountered residential appraisers — but how much do you really know about the field?
Real estate appraisals have long been an integral component of buying and selling a home, and they continue to be an important part of the mortgage process. We at Fannie Mae employ appraisers, and our lender partners engage them to provide a professional opinion of market value of a home, which helps determine the level of risk in mortgage transactions. Prospective homeowners sometimes seek an appraisal outside of the financing process to verify a property's value and may even find information in the appraisal that helps to protect them from making an unwise investment. While residential appraisals primarily serve the mortgage industry, they are also used for a variety of other purposes, including estate valuation, litigation and taxation support, public policy decision-making, and more.
An Industry in Transition
You probably didn't hear from an appraiser on career day at school — I know I didn't. There seems to be limited awareness of the career opportunities available in the residential appraisal field, and regulatory changes in the wake of the housing crisis a decade ago have contributed to a lack of incentives for entry. At the same time, increasing digitization of the mortgage industry to make it more efficient is creating a sense of urgency for the traditional appraisal process to evolve.
Currently, the majority of appraisers are nearing retirement: 49 percent are between the ages of 51 and 65, and an additional 13 percent are 66 or older. As older, experienced appraisers retire, we need a new generation to step in, yet fewer people are entering the profession: only 7 percent of appraisers have been working in the industry for two years or less, whereas 52 percent have been in for 20 years or more. The present field of appraisers is also lacking in diversity, as 75 percent of appraisers are men and 87 percent are white.1
In 2018, the Appraiser Qualifications Board of the Appraisal Foundation adopted changes that state regulatory boards have begun to implement: Notably, education and experience requirements were modified to remove barriers that have deterred otherwise qualified candidates from entering the profession. Fannie Mae and other industry stakeholders see this as an opportune time to encourage talented new entrants to the field from all segments of the population, shaping an appraiser workforce that better represents the diversity of our nation.
New Ways of Working Mean New Opportunities
The adoption of cutting-edge technology and process updates means that while appraisers can still choose to go out into the field, it is now possible to complete appraisals by primarily working in an office. In fact, many companies hire appraisers to determine property value based on a combination of property data gathered by trained professionals in the field and a variety of online data sources. This gives appraisers the option to analyze the data from their desks without having to visit each property. For those who do want to be in the field, instead of relying on the traditional clipboard and tape measure, appraisers now use tablets, laser measuring devices, and even 3-D scans to collect property information.
This evolution presents intriguing new opportunities for appraisers to work in a variety of different ways, providing flexibility on working hours and location. Appraisers can run their own business or work for a company – there is no single career path. This flexibility promotes a healthy work-life balance: Appraisers are often able to pivot working hours around family priorities, taking care of business at the most convenient and productive times of the day.
Reaching Future Appraisers
To increase awareness about appraisal careers, Fannie Mae is working with the National Urban League and other industry partners, who are providing training scholarships and free software, to reach diverse, talented candidates and educate them about the appraisal industry. We are also spreading the word about appraisal career opportunities – view our Career Opportunities in Residential Property Appraising video to see for yourself.
This is an intriguing time in the appraisal industry as it moves toward a dynamic, data-driven, and transparent future with updates to the entire appraisal process. New procedures and technology introduced by market participants have opened the door for flexibility and additional career opportunities in the field. Don't be surprised to see a real estate appraiser on the roster of your kid's career day in the future – this is a career field in transition, with a promising future ahead. To learn more, check out www.fanniemae.com/appraisers.
VP, Single-Family Credit Risk Collateral Management
June 3, 2019
1 U.S. appraiser population statistics derived from the Appraisal Subcommittee (ASC) National Registry as of December 31, 2016. Demographic statistics derived from Appraisal Institute (AI) studies conducted in 2016 comprised of randomly selected AI members and non-member valuation professionals. Survey sample 2,072 individuals, sampling error of approximately +/- 2.6 percentage points at the 95% confidence level.