The National Association of Home Builders (NAHB) released a white paper on Wednesday calling for an overhaul of the system by which residential appraisals are determined. The group made a number of recommendations, some of which members of the National Association of REALTORS® have supported in the past, including the implementation of licensing and certification standards as well as minimum education requirements. However, another in their list of recommendations could have serious consequences for the role of the multiple listing service (MLS) in home sales.
A section of the white paper focused on data technology criticizes local MLSs for becoming “less reliable” in recent years. The solution to this, and the more general problem of a lack of data standards that apply across the country, is what NAHB refers to as “the development of a real estate superhighway.” The group proposed creating this in four sections:
- Terra.gov – NAHB proposed “a national real property registry… with access by all stakeholders.” They named this as the site of an “official record of the factual details of both the structure and the regulatory constraints on the land.” Some of the specific items mentioned as included in such a database were time stamped photographs, satellite images, and floor plans. As of Friday afternoon, the Terra.gov domain name remained unregistered according to WhoIs.com. Continue reading »
By Robert Freedman, Senior Editor, REALTOR® Magazine
You can’t expect much from a single letter but a recent communication from NAR to federal regulators could help shine a light on an appraisal issue that that needs as much light on it as possible. The issue concerns appraisal management companies (AMCs), the middlemen between appraisers and the lenders that hire them. Earlier this year AMCs began rolling out changes to the contracts between them and their appraisers that offload the legal liability over loans gone bad to the appraiser. That means the appraiser who earns about $200 for an appraisal (after the AMC has taken its 45 percent cut of the fee) also has to shoulder the burden if a consumer or the lender or some other party decides to sue.
Appraisers already assume a certain amount of liability over valuation issues, of course. Any time they release a valuation they certify to its integrity, so they already shoulder liability if someone thinks the numbers are misleading. Continue reading »
By Robert Freedman, Senior Editor, REALTOR® Magazine
For weeks, NAR has been getting e-mails and phone calls on problems caused by the implementation of the Home Valuation Code of Conduct. If you’re not familiar with HVCC, it’s an agreement entered into between the two secondary mortgage market companies Fannie Mae and Feddie Mac and the State of New York. The intent of the agreement is laudable: to curb the kind of inaccurate appraisals that helped fuel the housing meltdown.
But HVCC has turned out to be a problem in its own right, judging from everything we’re hearing, and not just for real estate deals in New York. The two mortgage companies are applying HVCC rules to all mortgages they handle, regardless of state, so any problems with HVCC are nationwide in scope.
Here’s a sample of what our researchers found: Continue reading »
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