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Real Estate Appraisal: A World of Change

Real Estate Appraisal: A World of Change. John S. Brenan Director of Research and Technical Issues The Appraisal Foundation (202) 624-3044 john@appraisalfoundation.org. FIRREA Relationships. The Appraisal Foundation Mission.

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Real Estate Appraisal: A World of Change

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  1. Real Estate Appraisal:A World of Change John S. Brenan Director of Research and Technical Issues The Appraisal Foundation (202) 624-3044 john@appraisalfoundation.org

  2. FIRREA Relationships

  3. The Appraisal FoundationMission The Appraisal Foundation was founded to foster professionalism in valuation by promoting professional appraisal standards and appraiser qualifications.

  4. The Foundation IS: A non-profit educational organization; Founded by 8 national appraisal organizations; and Created to foster professionalism in appraising. The Foundation is NOT: A government agency or regulatory board; Created by Congress; or An appraisal trade organization that offers designations. The Appraisal Foundation

  5. Sponsoring Organizations Appraisal Sponsors • American Society of Appraisers • American Society of Farm Managers & Rural Appraisers • Appraisal Institute • International Association of Assessing Officers • International Right of Way Association • Massachusetts Board of Real Estate Appraisers • National Association of Independent Fee Appraisers • National Association of Master Appraisers Affiliate Sponsors • American Bankers Association • Farm Credit Council • Mortgage Insurance Companies of America • National Association of Realtors • Appraisal Institute of Canada

  6. Boards Board of Trustees Appraisal Standards Board Appraiser Qualifications Board Councils The Appraisal Foundation Advisory Council (TAFAC) Industry Advisory Council (IAC) Education Council of Appraisal Foundation Sponsors (ECAFS) The Appraisal FoundationBoards and Councils

  7. Appraisal Standards Board • Writes and Interprets the Uniform Standards of Professional Appraisal Practice (USPAP). • Publishes Advisory Opinions, Frequently Asked Questions, and monthly Q&A’s. • Currently composed of 6 members.

  8. Appraiser Qualifications Board • Sets minimum requirements for state certification of real property appraisers. • Has developed minimum voluntary criteria for personal property appraisers. • Currently composed of 5 members.

  9. Program to Improve USPAP Education As of January 1, 2003, all Qualifying Education Courses must be the 15-hour National USPAP Course or its equivalent (as determined by the AQB) and must be taught by an AQB Certified USPAP Instructor and a Certified Residential or Certified General appraiser Certified USPAP Instructor Requirement Criteria: • 7 years of appraisal experience • 35 hours of teaching experience within the last five years • Successfully complete 2½ day Instructor Certification Course and pass examination • Attend 7-hour Instructor Recertification Course and pass examination at least once every two years Note: There are currently over 450 AQB Certified USPAP Instructors

  10. Current Trainee License = 75 Hours of Qualifying Education Residential License = 90 Hours of Qualifying Education Certified Residential = 120 Hours of Qualifying Education Certified General = 180 Hours of Qualifying Education Effective 1/1/08 Trainee License = 75 Hours of Qualifying Education Residential License = 150 Hours of Qualifying Education Certified Residential = 200 Hours of Qualifying Education. Also must possess Associate degree or 21 semester hours (credits) of college course work in seven (7) topic areas Certified General = 300 Hours of Qualifying Education. Also must possess Bachelors degree or 30 semester hours (credits) of college course work in ten (10) topic areas Appraiser Qualifications BoardEducational Requirements Note: All categories require completion of the 15-hour National USPAP Course

  11. Trainee License – 75 Hours Basic Appraisal Principles 30 hours Basic Appraisal Procedures 30 hours The 15-Hour National USPAP Course or its equivalent 15 hours Residential License – 150 Hours Basic Appraisal Principles 30 hours Basic Appraisal Procedures 30 hours The 15-Hour National USPAP Course or its equivalent 15 hours Residential Market Analysis and Highest and Best Use 15 hours Residential Appraiser Site Valuation and Cost Approach 15 hours Residential Sales Comparison and Income Approaches 30 hours Residential Report Writing and Case Studies 15 hours Appraiser Qualifications BoardRequired Core Curriculum

  12. Certified Residential – 200 Hours Basic Appraisal Principles 30 hours Basic Appraisal Procedures 30 hours The 15-Hour National USPAP Course or its equivalent 15 hours Residential Market Analysis and Highest and Best Use 15 hours Residential Appraiser Site Valuation and Cost Approach 15 hours Residential Sales Comparison and Income Approaches 30 hours Residential Report Writing and Case Studies 15 hours Statistics, Modeling and Finance 15 hours Advanced Residential Applications and Case Studies 15 hours Appraisal Subject Matter Electives 20 hours Appraiser Qualifications BoardRequired Core Curriculum

  13. Certified General – 300 Hours Basic Appraisal Principles 30 hours Basic Appraisal Procedures 30 hours The 15-Hour National USPAP Course or its equivalent 15 hours General Appraiser Market Analysis and Highest & Best 30 hoursUse Statistics, Modeling and Finance 15 hours General Appraiser Sales Comparison Approach 30 hours General Appraiser Site Valuation and Cost Approach 30 hours General Appraiser Income Approach 60 hours General Appraiser Report Writing and Case Studies 30 hours Appraisal Subject Matter Electives 30 hours Appraiser Qualifications BoardRequired Core Curriculum

  14. BASIC APPRAISAL PRINCIPLES 30 HOURS A. Real Property Concepts and Characteristics 1. Basic Real Property Concepts 2. Real Property Characteristics 3. Legal Description B. Legal Consideration 1. Forms of Ownership 2. Public and Private Controls 3. Real Estate Contracts 4. Leases C. Influences on Real Estate Values 1. Governmental 2. Economic 3. Social 4. Environmental, Geographic and Physical D. Types of Value 1. Market Value 2. Other Value Types E. Economic Principles 1. Classical Economic Principles 2. Application and Illustrations of the Economic Principles F. Overview of Real Estate Markets and Analysis 1. Market Fundamentals, Characteristics, and Definitions 2. Supply Side Analysis 3. Demand Analysis 4. Use of Market Analysis G. Ethics and How They Apply in Appraisal Theory and Practice Appraiser Qualifications BoardGuidance for Curriculum Content

  15. Thank You!!! Questions?

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