Complete Guide to Starting Your Own Real Estate Appraisal Business
Low-interest rates, a rise of the work-from-home culture, lack of supply, and prices of properties going through the roof – the real estate industry never had it so good. Since the appraisal business and the real estate industry are partners in growth, demand for certified and qualified appraisers is at an all-time high.
This article consists of all the information required to become a Home Appraiser.
What is a Real Estate Appraiser?
When it comes to the valuation of real estate, all interested parties need the services of a real estate appraiser. Interested parties in real estate would include buyers, sellers, agents, banks, and investors. Appraisers need to have the Real Estate Appraiser License to be considered for property valuation.
Two broad categories of properties that need valuation are residential and commercial properties. In simple terms, commercial properties are valued based on Net Operating Income or NOI, while the residential appraisal business uses the sales comparison approach.
The Net Operating Income approach takes into account the potential rental income generating capability of the commercial property. In contrast, the residential property is valued according to the price of similar property fetches in the neighborhood. Of course, price adjustments are made in the residential property if the property has extra features or lacks some features (like a swimming pool).
To become a practicing real estate appraiser, one must clear the National Uniform Licensing and Certification Exam. Is it tough? With more than 1 of 3 examinees failing the exam, it certainly is! The good news is that with the right Appraisal Courses like the McKissock Appraisal Exam Prep packages, it is possible to ace the exam at the first attempt.
Before taking the exam, one needs to fulfill the Appraiser Qualification Board’s (AQB) educational requirements depending on the specific license exam being taken.
A trainee appraiser needs to complete 75 education hours to qualify for the exam. No college degree or experience is required.
Licensed Residential Appraiser
A licensed residential appraiser needs 1000 hours of acceptable experience but no college degree to appear for the appraiser exam. The education hours required are 150.
Certified Residential Appraiser
A certified residential appraiser must complete 200 education hours to be eligible for the exam. In addition, there are certain minimum college degree requirements and experience required as well.
The college degree requirements are:
- Bachelor’s degree
- Associate’s degree in the specific field of study
- Completion of 30 college semester credit hours in the required topics
- Clearing the CLEP (College-Level Examination Program)
The experience requirement is 1500 hours of acceptable appraisal experience.
All these exams are live-proctored, and one needs to clear these exams in 3 attempts.
Choosing the Right Course
Investing in the right course could make the difference between success and failure in the exam. The 3 essential criteria for the selection of the right Appraisal Course Online are:
Appraisal courses should be flexible enough to allow self-paced learning. To reinforce the crucial topics learned, live-streaming classes are important. Additional resources like Pro-Series Webinars should be part of the course. Accredited courses like McKissock offer all this and more.
What makes these courses worthwhile is that they are developed by professional appraisers, ensuring a practical and industry-based approach.
Maximization of Investment
Not only does one benefit from the rigorous practice these courses offer, but they may also qualify for one or more licensing exams. McKissock has partnered with appraisal CRM software like Anow, and its members can get heavy discounts. Anow users get a 10% discount on their initial McKissock Unlimited Learning Membership fees.
Other benefits include assistance with professional development, including USPAP (Uniform Standards of Professional Appraisal Practice).
Enrolling in McKissock’s Appraisal Courses also provides access to a digital library of professional resources that ensures 24×7 resolution of any queries.
Join the Appraiser Community
Networking with fellow appraisers is vital for any aspiring appraiser’s professional growth and development and should be part of the Appraisal Business Plan. Associations like the NAA (National Association of Appraisers), AIC (Appraisal Institute of Canada), or ASA (American Society of Appraisers) offer ample networking opportunities and potential business prospects.
Other benefits of being part of the appraiser community are learning about the best practices in the industry, getting guidance from experienced members, finding a mentor, staying updated on the latest trends, help in fulfilling continuing education requirements, and gaining a designation.
Become an Appraiser Trainee
To become an appraiser, the first step is undergoing training as a trainee appraiser. Approval by the State Appraisal Board is required for this, and this is what qualifies the trainee to undergo acceptable real estate experience with a General Real State or Certified Residential Appraiser.
The trainee appraiser needs to:
- Fulfill course requirements: A trainee must complete 75 hours of the required courses that include the National USPAP course, Basic Appraisal Principles, and Basic Appraisal Procedures. Appraisal Training requirements vary by State, with Kentucky requiring 90 hours of required courses.
- Register With the Real Estate Appraiser Board: The next step for the trainee appraiser is applying to the State’s Board. They need to provide proof of completion of the required appraisal courses, pay the application fee, and undergo the background check.
- Training Under a Certified Appraiser: Training opportunities with appraisers are available with Anow. They learn the nuances of inspection and gain the required experience before submitting their first report.
Given the booming real estate market, the sky’s the limit for appraisers. Appraisal platforms like Anow Nexus make life easier for practicing appraisers with the right tools and onboarding support. If you think you have what it takes, become an appraiser today and begin a profitable business.