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The Residential Appraiser Is Taught On Our Local Markets, Communities, And The Nation As A Whole

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The residential appraiser is taught how to measure a home, examine it for positive and negative features, take photos, study the neighborhood, seek out comparable sales and listings, and create a report that solves a valuation problem. All of these things primarily involve the technical side of the work. But what about the bigger picture? What we do has a profound effect upon our local markets, communities, and the nation as a whole. We are an important participant in all of these things.

You can see it in everyday practice. Is it just a coincidence that a size adjustment of say $30 per square foot seems to be just right in equating two or three comparables? Is that only what the market seems willing to pay (or subtract) for the
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But if you still are not sure, think about some things that will happen if you do the wrong thing.

Being listed in MLS, if that home does end up closing at the inflated price, it will show up as a closed sale in MLS. When brokers and agents conduct a competitive market analysis of another similar home they want to list, the inflated price of the property you over appraised will enter into their research and influence the list price the agent recommends to their seller. I have seen situations where just one inflated sale caused every new listing in a neighborhood to be priced at the same level. The inflated sale can cause a cascade effect. Now every home is overpriced because of one inflated sale. The result is buyers faced with less affordability and/or sellers attempting to sell their homes at asking prices that are not realistic. Buyers, sellers, agents and even lenders and title companies out there can suffer as a result of this. All because you did not do your duty and failed to consider the bigger picture.

The appraiser, whether he or she realizes it or not, often acts as a traffic cop. The mere presence of a policeman on a busy road will cause most sensible drivers to pay greater attention to the rules of the road. But simple visibility alone is not enough. The cop must be willing to act when necessary. Most traffic laws are enforced in such a way as to allow for at least some degree of noncompliance, such as allowing someone to be
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