As appraisers are dropping out and retiring from the appraisal field due to strict guidelines on qualifications and education requirements the AQB (Appraiser Qualifications Board) has been rethinking the current set of standards applied to Licensed and Certified Appraisers. The board establishes the minimum education, experience and exam requirements for an appraiser to obtain a certification within the state.
In the past two years the AQB has published a draft, held a public hearing, had an online briefing and has written three exposure drafts. In an effort to alleviate the current process of becoming an appriaser The Appraiser Qualifications Board are continuing with their Fourth Exposure Draft to facilitate change. The topics included in this Fourth Exposure Draft that would affect appraisers include Degree Requirements for Licensed and Certified Residential Appraisers, Alternative Track for Licensed Residential to Certified Residential, Practical Applications of Real Estate Appraisal and Experience Requirements.
Section 1 of the draft pertains to the Degree Requirements for Licensed and Certified Residential Appraisers. Currently one of the requirements for a Licensed Residential Appraiser is that they hold an associate’s degree or higher from an accredited college, junior college, or community college or 30 semester credit hours of college-level education from an accredited college, junior college, community college or university. The AQB is proposing to remove this college-level education requirement. The Certified Residential Real Estate Appraiser in Maryland must hold hold a bachelor’s degree or higher from an accredited college or university. This Exposure Draft proposes alternatives to the Bachelor’s Degree requirement for the Certified Residential Appraiser. These are the following options for the Certified Residential credential:
1) Bachelor’s Degree in any field of study;
2) Associate’s Degree in a focused field of study;
3) Successful completion of 30 college semester credit hours in specified topics;
4) Successful completion of College-level Examination Program (CLEP) exams equivalent to a minimum of 30 semester credit hours in specified subject matter areas; or
5) Any combination of #3 and #4 above that includes all of the topics identified.
The major concern of the AQB is public trust in the appraisal profession and maintaining appropriate requirements regarding education and training. They do not want to establish further criteria that negatively affect the supply of appraisers.
Section 2 refers to an Alternative Track for Licensed Residential to Certified Residential. Many of the Licensed Residential Appraisers that had been working in this industry for a long period of time were under the assumption that when the criteria came out regarding the need for a college degree they would be “grandfathered in” and able to continue with their appraisal assignments. This was not the case, Licensed Appraisers had a smaller pool of work due to the college criteria established in the requirements for licensing. The AQB now recognizes ethical and competent Licensed Residential appraisers with a history of performing residential quality appraisals should have an alternative path to obtain a Certified Residential credential, given they only lack the required college-level education. Therefore, the AQB is proposing a path for this issue.
The Practical Applications of Real Estate Appraisal (PAREA) are addressed in Section 3. This concept would provide an alternative to gaining experience during the training process of becoming an appraiser. The proposed PAREA curriculum consists of three modules that would encapsulate appraisal experience in both a classroom and external practice-based environment. This concept will need further development due to the current responses on this subject and lack of understanding on how the trainee can be properly trained beyond the traditional avenues of extensive field experience under the care of a qualified trained appraisal professional. The amount of trainees in this industry is minimal due to criteria and overall lack of training opportunities in appraisal firms and the financial disincentives inherent in training programs for both the mentors and trainees.
Section 4 tackles the Experience Requirements. Within the past 20 years the number of hours of qualifying education required have increased substantially, the education must follow a specific qualifying required core curriculum, college level education,qualification requirements for supervisory appraisers , qualifying USPAP education every 2 years, a final examination, National Uniform Licensing and Certification exams. All of these hurdles have off set the balance and desire for appraisers to stay or enter into this field.
The AQB is striving to consider changes where the balance can be restored and the shortage of appraisers will not continue to decline. Sara Stephens, president of the Appraisal Institute noted, “The Appraisal Institute expects the rate of decrease will increase sharply over the next five to 10 years due to demographic and economic factors.” A high rate of retirements, individuals leaving the profession due to poor business conditions and few new individuals entering the profession could result in a 25 to 35 percent decrease in the number of appraisers in the U.S. in five to 10 years, according to the institute.
All interested parties are encouraged to comment in writing to the AQB before Friday, January 12, 2018. The AQB will also accept verbal comments at its public meeting in Washington, DC on Thursday, February 1, 2018.
If you are interested in downloading or reading in further depth the Fourth Exposure Draft please click here https://appraisalfoundation.sharefile.com/share/view/s7ce4c46184b47f9a