The chapter is wrapping up our summer education series, and San Diego education offerings do not resume until September, so I will be writing the President’s Message for the next two months. However, there is certainly enough going on in the appraisal industry that needs to be addressed, as there were two big decisions made in the lending arena that have an impact on the appraisal industry.
The first is the National Credit Union Administration’s decision to increase the appraisal threshold for nonresidential real estate loans from $250,000 to $1 million. The NCUA’s final rule can be found here, but here is a simple PowerPoint presentation detailing the rule. In lieu of an appraisal, a “written estimate” can be provided by an “independent and qualified person,” with the reasoning that only marginal risk is added; reportedly, commercial real estate accounts for only 4 percent of credit union assets. As AI National pointed out, this new threshold is double the recent threshold established by the federal banking regulatory agencies, which increased the commercial appraisal threshold from $250,000 to $500,000.
The second decision was the Appraisal Subcommittee granting a request from North Dakota for a temporary waiver from appraisal licensing requirements after state officials claimed a scarcity of appraisers. The waiver affects credentialing requirements for appraisers conducting appraisals of federally related transactions under $500,000 for 1-to-4 family residential real estate transactions and under $1 million for agricultural and commercial real estate transactions throughout the state. In other words, non-licensed people will be able to provide appraisals (as long as they are USPAP-compliant). The ASC’s decisions was influenced heavily by the enclosed heat map, which shows the timeliness of appraisals based on calendar days.
It will take a little time to see how this pans out, but there are two takeaways from these events. The first is that appraisers need to be informed. Although these decisions have only been recently made, they have been in the works for some time. I encourage you to keep abreast of these issues by subscribing to the AI newsletters and reading AI materials about legislative issues.
The other takeaway from this is being involved. The AI Government Relations Committees across the country are working on legislative issues to help appraisers, such as allowing appraisers to perform evaluations in certain states. California has one of the more active GRCs in the organizations, so if you are interested in volunteering for this group, please reach out to the San Diego chair, Ben Kunkel.
Lastly, AI had their national conference last week, and there are two items that I would like to share. First, the Appraisal Institute Education and Relief Foundation (AIERF) recently established a scholarship for Practicing Affiliates working towards state certification. For those working toward getting certified, this is a great opportunity to do so with AI education. Complete the application online by going to AIERF’s website.
The other exciting news is that our chapter’s own Steve Roach was honored with the Lifetime Achievement
Award, which is presented to an Appraisal Institute professional who demonstrates high ethical standards; has volunteered several years of service and has contributed to the Appraisal Institute on the international, national, region and/or chapter level; has served his or her community; and has contributed to the appraisal profession for at least 20 years. From one of your countless students, thank you for your support of our profession. Well deserved!
Have a great month!
Eric Schneider, MAI, SRA, AI-GRS
2019 Chapter President