As a result of the Covid-19 pandemic, local, state, and national leaders have issued mandates for closures of non-essential businesses, schools, and large group assemblies. Many companies have moved to work-from-home models and enacted social distancing protocols. A new world has emerged for business where the prevention of the spread of Covid-19 is a main priority and social distancing is the new normal.
Appraisals too have changed, at least temporarily. Guidance issued by industry organizations – such as the Department of Veterans Affairs (VA), Fannie Mae and Freddie Mac – outline new, temporary appraisal standards and procedures including:
- Assessing risks by phone in advance of the appraisal by asking a number of set health and travel questions
- Use of alternative appraisal methods such as drive-by inspections or desktop appraisals
- Sourcing interior information using alternative sources, such as multiple listing service (MLS) or photos sent from the homeowner, rather than physical, in-home inspections
It seems that most appraisers are taking the prescribed precautions. A survey of appraisers by Appraiser Buzz in April found that:
- Nearly 75% had questioned homeowners about their health before conducting an appraisal. This aligns with guidance provided by government and industry organizations
- More than two-thirds (68%) wore masks and two-thirds wore gloves during appraisals
- 61% asked homeowners to prepare their homes for inspection by opening all doors and turning on all lights before they arrive
- Nearly a quarter (24%) are wearing booties over shoes
The industry may have moved to alternative inspections as a temporary measure, but – given time – they may become standard practice on a more permanent basis depending upon the outcome of these emergency protocols set into place during the pandemic. The use of technology can streamline the appraisal process and virtually eliminate subjectivity or errors, and the USPAP has already provided some initial guidance to physical inspections performed by someone or something other than the appraiser. We already hear and use terms like ‘augmented desktop appraisal,’ ‘augmented reality,’ and ‘virtual inspections.’
Recently, Fannie Mae and Freddie Mac clarified their requirements for drive-by inspections, saying that appraisers must verify the condition of a property’s interior using images from the MLS or other online sources or photos taken by real estate agents or the homeowner.
Appraisers may not be first responders, but our profession continues to work and do its bit to help keep the economy moving. It’s always wise to take the precautionary steps outlined in guidance from the industry and government agencies. Be sensible. Be reasonable. Above all, be safe.
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