Texas recently conducted a study on Appraisal Management Companies and Real Estate Appraisers. 1584 appraisers and 55 AMCs were surveyed on various aspects of valuation services. The questions were designed to determine the following:
- Clearly distinguish between the fees paid to appraisers by Appraisal Management Companies and fees paid by non-AMC clients for residential appraisals.
- Capture any difference in fees paid by property type: single family, condominium, size or square footage, or other factors.
- Capture the impact on fees by market area or locale: urban vs. rural, (MSAs, county, zip code, etc.).
- Determine whether appraiser qualifications (experience, education, specialization) impact fees paid to appraisers.
- Determine how far the appraisers travel for an assignment; and if from
another state or distant region, how much time they spend gathering the data for the appraisal.
- Determine what fee structure the AMCs offer appraisers for residential appraisals.
- Determine whether those fees vary by property type.
- Determine if there is a difference in the fees they pay based upon urban, rural or other location factors.
- Determine whether AMCs pay differing fees to appraisers based upon their experience.
While there have been disagreements nationwide regarding appraisal fees since the HVCC and Dodd-Frank Act, I think we can all agree these are questions everyone in the appraisal industry has wanted to know. We now have answers for the state of Texas, thanks to the Texas A&M University Real Estate Center. The results of their study showed that a majority of appraisers reported Appraisal Management Company fees ranged from $300-$450 for a full report, while non-AMC fees ranged from $350-$450 per report. These are very close numbers, with the AMC fees reporting only a slightly lower range. This is a big step in showing appraisal fees in Texas are customary and reasonable. I’m thrilled to report our average fee for a full conventional appraisal is in the range of the non-AMC fees reported in this survey. Nationwide Appraisal Network exceeds average AMC fees in Texas!
AMCs and appraisers cited the following as reasons for fee increases:
- Complex assignment
- Rural location
- Large property
- Greater distance traveled to complete appraisal
Have you ever wondered how Appraisal Management Companies select a residential appraiser for an assignment? The 55 Texas AMCs surveyed reported the following as their top three determining factors when assigning an appraisal order, from most important to least:
- Appraiser’s experience
- Previous experience for the AMC
- Reputation for quality work
With 3 out of 5 appraisers reporting at least half of their assignments come from Appraisal Management Companies, it looks like Texas is a good state to be appraising in, especially if you’re on our panel!