How New Technology Will Spur Growth in the Appraisal Industry Jeff Bradford CEO Bradford technologies Inc ComputerAided Appraising What is it And why do we need it ComputerAided Engineering ID: 677985
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Computer-Aided AppraisingHow New Technology Will SpurGrowth in the Appraisal Industry
Jeff Bradford, CEO
Bradford technologies, Inc.Slide3
Computer–Aided AppraisingWhat is it?And why do we need it?Slide4
Computer-Aided EngineeringHelped engineers solve problems that were previously unsolvable
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide5
Computer-Aided DesignHelped architects design structures that were previously not buildable
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide6
Computer-Aided ManufacturingHelped manufacturers produce products that were previously not possibleSlide7
Computer-Aided Golf Course DesignBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide8
Computer-Aided AppraisingWhat is it?It is the concept of harnessing the power of computers and technology to assist and empower the appraiser with capabilities that allow them to produce highly credible valuationsSlide9
Today…Appraisers have Powerful Form FillersAnd a lot of manual work!
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide10
Time to Complete an AppraisalI typically spend
4 to 5 hours
on a report not including field work with research and analysis taking up most of the time
4-6 hours
once I get started
The clerical, research and analysis phases,
plus the actual time spent writing the report usually totals up to about 4 hoursBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide11
Typical Appraisal ProcessBradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
Beginning
Middle
End
Data Gathering
Inspection & Analysis
Report
4- 6 Hours + Inspection = 1 Day
Manual Process
Manual Process
Manual Process
Manual ProcessSlide12
Appraisal Quality Suffers
Office of the Comptroller of the Currency
17.6 % of appraisals contained contradictory information
35% of repurchased loans are due to faulty appraisals
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide13
Appraisal Compliance IssuesUSPAP
UCDP, UAD
CFPB
Dodd Frank
Interagency Guidelines
Federal & State Independence Laws
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide14
Result: Credibility SuffersSlide15
Why are Appraisers in this Position?
Why don’t appraisers already have
computer-aided appraising technology?Slide16
Appraising is considered an “Art”Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide17
Appraising is considered an “Art”Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
Y
ou would never expect a computer to value the Mona LisaSlide18
Appraising is considered an “Art”Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
We also don’t expect computers to accurately value our homeSlide19
But Ever Since 1981…
AVM
These Black Box property valuation systems have been getting better and better every year. Slide20
But Ever Since 1981…Their usage continues to grow
AVMSlide21
But Ever Since 1981…
AVM
“Each month, we provide more than
one billion
AVM values
to lenders, brokers, government agencies, marketing firms, consumers and insurance companies”.Slide22
Today Valuation is BIG BusinessProperty Valuation has become a ScienceTeam of more than 50 PhDs, economists, and modelersCombined with nation’s largest property and ownership database covering 98 percent of the U.S. populationEquals “Good Enough” property valuationsSlide23
Appraising has to be more than “art”Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
The “
art of appraising
”
has to be augmented by the “
science of appraising
” Slide24
Big Data-AVM Review SystemsAppraisers are being reviewed & scored by systems that utilize massive amounts of dataData from AVM indicates the appraised value may be in excess of the neighborhood
Requests to reconsider comp selection
Requests for additional influence explanation
Requests for comp adjustment support
etc.Slide25
Big Data-AVM Review SystemsThese review systems have access to more property data and can process it much, much faster than the appraiser.Slide26
Appraiser is at unfair disadvantage
Appraising is an “art”
Appraising is a “science”Slide27
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
How can we compete ?Slide28
Is Mobile Computing the Answer?Slide29
More Efficient Inspections
Automatically loads
into the formsSlide30
Fill Out the URAR on a TabletSlide31
See More, Do More - QuickerSlide32
We Can Make Process More EfficientBut the Appraiser Cannot Compete
Appraising is an “art”
Appraising is a “science”
AVMSlide33
Partner with an AVM?AVMs: Hop on board the train or get left behind?
A
V
MSlide34
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Technology
Artificial Intelligence
AVMSlide35
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising TechnologyArtificial IntelligenceSlide36
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising TechnologyArtificial
vs
Augmented Intelligence
VS
+
Computer
Compute
r
+
Computer directed
Human directed Slide37
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Technology
VS
+
Computer
Human directed Strategy
The Winner
Artificial
vs
Augmented IntelligenceSlide38
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising Technology
VS
+
Computer
Appraiser directed Analysis
The Winner
Computer-Aided AppraisingSlide39
Computer-Aided AppraisingBradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
Inspection & Analysis
Report
Data Gathering
Shortens the Entire ProcessSlide40
Get Rid of This
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide41
Reduces ThisBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide42
Bradford Technologies, Inc. - The Leader in Innovative Valuation Solutions
+
Adds “Science” to the “Art”
Computer-Aided AppraisingSlide43
Bradford Technologies, Inc. - The Leader in Innovative Valuation SolutionsClosed Black Box AVMs
AVM
Valuations Providers
Zillow
Veros
Collateral Analytics
Corelogic
LPS
Many moreSlide44
Bradford Technologies, Inc. - The Leader in Innovative Valuation SolutionsAnalytics are open to Appraiser
Computer-Aided Appraising opens up the black box and let’s the appraiser drive the process and the analyticsSlide45
Computer-Aided AppraisingLike having Mr. Data help you value a propertySlide46
Work with Entire Market DataBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide47
Market AnalysisBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide48
Market Trends & ForecastingBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide49
Analysis DashboardsSlide50
Statistically Accurate Valuations
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide51
Computer-Aided AppraisingWhy do we need it?Computer-Aided Appraising transforms the appraisal process by letting computers do the tedious, manual processes and
by empowering appraisers with analysis capabilities that were never previously available.
Appraiser are
now
able to provide valuation
services to the entire valuation market
.Slide52
OpportunitiesBradford Technologies, Inc. - The Leader in Computer-Aided Appraising TechnologySlide53
Frees Appraisers from the 1004 Box
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide54
HELOCs are Big Business
Its expected to continue
for 2, possibly 3 years
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide55
New Evaluation Guidelines1. Must provide reliable estimate of market value2. Must address
property’s actual physical condition
3. Must address
market factors that affect value
BPO’s are not sufficient because it does not provide a market value
CMA - Competitive market analysis is not sufficient because it does not provide a market value
AVM alone is not sufficient because it does not include an inspection of the propertyBradford Technologies, Inc. - The Leader in Computer-Aided Appraising SoftwareSlide56
Valuation Market ShareBradford Technologies, Inc. - The Leader in Computer-Aided Appraising Technology
AVM
25%
$2.5 Billion
BPO
20%
$2 BillionAppraisal55%$5 BillionAVMs and BPOs traditionally used for HELOC collateral valuationsSlide57
Take Back Some Market ShareBradford Technologies, Inc. - The Leader in Computer-Aided Appraising Technology
AVM
25%
2.5 Billion
BPO
20%
2 BillionAppraisal55%5 BillionIt would be nice to put1 billion dollars into thepockets of appraisersSlide58
Take Back Some Market Share50% of BPO’s is 7.5 million valuations - these include drive-by inspectionsIf 62,000 appraisers divided these jobs evenly, each must do 120 more valuations/year
These jobs pay $125 - $150; Each appraiser could add up to $18,000 to their bottom line.Slide59
Appraiser Evaluation ProcessAppraiser with Market Expertise
It starts with the “brains” of the operation
The AppraiserSlide60
Appraiser Evaluation Process
Third Party
Inspection
Appraiser with
Market ExpertiseSlide61
Appraiser Evaluation Process
Third Party
Inspection
- MLS Sales & Listings
- Public Records
- Aerial Imagery
Appraiser with
Market ExpertiseSlide62
Appraiser Evaluation Process
Third Party
Inspection
Appraiser with
Market Expertise
- MLS Sales & Listings
- Public Records
- Aerial Imagery
Computer-Aided
Appraising TechnologySlide63
Appraiser Evaluation Process
Third Party
Inspection
Appraiser with
Market Expertise
Evaluation
Its really an appraisal !
- MLS Sales & Listings
- Public Records
- Aerial ImagerySlide64
Industry Needs New AppraisersFrom Appraisal Institute – Age of Appraisers:
Mean
Median
Mode
MAI 62 60 64SRA 63 61 64Slide65
Appraiser Trainee OpportunityBradford Technologies, Inc. - The Leader in Computer-Aided Appraising Software
Performed by a machine
Performed by an agent
Appraiser Trainee
can do
these Evaluation-Appraisals
with Supervisor guidanceAdditional Income to firmSlide66
Appraiser Trainee OpportunityBradford Technologies, Inc. - The Leader in Computer-Aided Appraising TechnologyBPO
vs
Appraiser Trainee
Supervisor signature
Full Market Analysis
Property InspectionSlide67
Are Appraisers Ready for the Future?Slide68
What One Appraiser Thinks“Once you learn regression (really learn it) it makes your life as an appraiser so much easier. So much so that you really don’t need that silly manual grid to come up with a credible value opinion.”
Bradford Technologies, Inc. - The Leader in Computer-Aided Appraising TechnologySlide69
What Many Appraisers ThinkBradford Technologies, Inc. - The Leader in Computer-Aided Appraising Technology
It’s the future
and I can't wait
Its nice, but
its not for me
Its the beginning
of the end for appraisers
2500 appraisers surveyed
after “Building Stronger Appraisals Faster “ webinarSlide70
Thank YouAppraisalWorld.com800-622-8727