Man vs. machine
Any industry as data-driven as appraisal is arguably a prime candidate for digitalization. Automated valuation models already help zero in on a home's worth by assessing a combination of local market factors and property features. By that thinking, a better algorithm could help solve for discrepancies in the variations of appraised values.
"[Fannie Mae] will tell you, if a house sells, they get the data like seven or eight different times. So they know the accurate data of all these homes," said Claudia Mobilia, senior vice president of operations at Embrace Home Loans.
"Somebody's going to come out with an automated model that's going to have required property inspection, or maybe the appraisal is going to be done at a desk. I don't think we're going to see appraisers traveling around the marketplace. There's not enough people in the industry to support it anymore."
Appraisers counter that their value lies in their understanding of the market and expertise on components specific to a particular property that data, drone footage and photographs
"When you start to get into more unique types of properties, or properties with lots of different features, rural properties, and so forth, then some of these other real estate products are going to be, maybe not even possible in some cases, so you're absolutely going to need an appraiser," said Appraisal Institute President Steven Wagner.
Others with ties to the appraisal industry acknowledge a lag in the adoption of innovation, but see a path forward where innovation empowers human assessment capabilities.
Anow is an appraisal management software company that helps facilitate scheduling by pinging appraisers within a certain radius of a property to conduct a valuation, not unlike how a ride-sharing application might work. It allows users to capture and upload photos and navigate each step of an appraisal through its mobile application. This lends itself to the theory that technology won't so much eliminate appraisers, but evolve and streamline their workflow.
"It's about putting tools in appraisers' hands and making them hyper-efficient. We have an Uber-like experience now where you can order an inspection, you can have someone right away and watch them drive to your door. They use our data collection tools to fill all that out and send it off before they even leave the property," said Anow's CEO, Marty Haldane.
"The difference of that to what exists today is you order an appraisal, wait for an appraisal company to accept it and call the homeowner to schedule it. Show up with pen and paper, go back, write the report, send it off. That's why in many areas we're talking about 10-plus business days to get an appraisal done, and I think that's where we really need to augment appraisers," he continued.