Just shy of a year ago, Real Estate Weekly published an article entitled “Brain Drain Decimating Appraisal Profession.”
The points made in the article included a drop in the total number of appraisers in the country; the advancing age of current appraisers; decreased demand during the years of economic struggle; regulatory changes as a result of the mortgage crisis; and more stringent requirements to become a state licensed real estate appraiser.
What may sound like gloom and doom does, however, have a strong upside.
Within the recovering economy there has been an increased demand for appraisal services and proactive initiatives at the national Appraisal Institute and chapter levels are seeking to draw a younger demographic to the profession and provide support with regard to educational requirements for licensing and achieving designations.
Recently, members of the Metropolitan New York Chapter of the Appraisal Institute’s board of directors met to discuss the future of their profession, how they are seeking to attract new talent and the value of the Appraisal Institute’s designations in building a career.
“There isn’t a child in the United States today who is saying, ‘When I grow up, I want to be an appraiser’,” said Marc J. Nakleh, a director at Cushman & Wakefield.
Not only is appraisal not a high profile or glamour career that young people dream about or, for that matter, even know about, real estate programs at accredited universities are a relatively new phenomenon and not all programs feature an appraisal concentration or degree, such that it is often not on the radar screen of today’s college students and those beginning careers.
Yet every one of the appraisers queried consider their profession to be a rewarding and stimulating career with a great future given market demand characteristics. “Demographics reflect significant opportunity for diligent young people seeking a profession with a long-term upside,” said Theresa Nygard, senior vice president, KTR Real Estate Advisors.
“Of particular interest to women, is that it is also a career that offers flexibility and, while most appraisers are male, there is no discernable glass ceiling in the profession.”
As for the importance of appraisal work, “The question of value is omnipresent in real estate,” said Eric Lewis, executive managing director and industry leader of the Hospitality & Gaming Group, Cushman & Wakefield, Valuation & Advisory Services and 2013 president of the Metro New York Chapter of the Appraisal Institute.
Appraisal plays a key role in all aspects of real estate — whether in the process of developing, buying or selling real estate.
Although appraisal requires a thorough education of all aspects impacting the value of real estate, currently Arthur Chiaramonte, principal, Capital Appraisal Services, finds that when he speaks with students at NYU Schack Institute of Real Estate, “Everyone wants to be in development,” rather than appraisal.
Marc Nakleh’s response is that appraisal work provides a great foundation with regard to skill sets, even if you move on to another area of real estate. “Give valuation a few years commitment and you can build an outstanding career in any area of real estate,” said Nakleh who accepted an offer in the Valuation and Advisory Group of Cushman & Wakefield the Friday before he was to begin a job as a broker at a different real estate firm, and never looked back.
“Especially when the economy is struggling, you have to be more creative in looking at a career field,” said Alice Palmisano, executive director, Brown Harris Stevens Appraisal & Consulting.
There are also opportunities for individuals with backgrounds in virtually every field of higher education study. Before beginning their appraisal careers, Nakleh was studying software development; Nygard graduated with a degree in art history and English; Palmisano majored in dance; Chiaramonte was studying electrical engineering; and Lewis had a degree in public accounting.
In addition to the New York City market, both Nakleh and Lewis are taking their mission of recruiting younger talent to their alma maters, the University of Florida and Lehigh University respectively where they are consulting on real estate curriculums.
With all in agreement that appraisal is both an art and a science, when asked for a keyword to describe who makes a good appraiser, the answers included being logical (Chiaramonte); dedicated and hard working (Nakleh); possessing good writing and communications skills to convey valuation results to people who are not experts working in the field (Lewis); as well as being analytical (Nygard); and observant (Palmisano).
“Buildings and land don’t exist in a vacuum. People use real estate,” she said.
As for providing support for young professionals to grow in their field, the Appraisal Institute is currently encouraging established professionals to serve as advisors for associates who are candidates for designation, and setting up more specific timelines for progress towards a designation.
The Appraisal Institute offers two designations, the MAI, held by individuals who are experienced in the valuation of commercial, industrial, residential and other types of properties and who advise clients on real estate investment decisions; and the SRA which is held by individuals who are experienced in the analysis and valuation of residential real property.
Under the Appraisal Institute’s newly established timelines, the rigorous course of study is forecast to take five years to achieve an MAI designation and four years for the SRA designation. The Metropolitan New York Chapter currently has a candidate guidance committee chair, Steven Schleider, president, Metropolitan Valuation Services, who serves as an information and support source for Metro NY Chapter candidates for designation.
Lewis, Nakleh, Chiaramonte, Nygard and Schleider all hold the MAI designation and Palmisano holds an SRA. All agree that the designation sets an appraiser apart from the competition and is an assurance to clients that they are working with a professional with extensive experience, knowledge and expertise.
As for the current older age of appraisers, the aging population also suggests that the level of experience among the Appraisal Institute’s membership is high.
With new emphasis on recruiting new talent to the field, providing additional guidance to current designation candidates and the Appraisal Institute’s decision to transition to a professional society, the Appraisal Institute promises to offer a continued source of skilled appraisers who are trained to the highest standards of the profession.