Apple Appraisal Blog

This just came down from our licensing gods…As you probably know, “USPAP” that they refer to in the paragraph below is the rules and regs that we as appraisers must abide by, by law, State and Federal. This pretty much means that an appraiser (or reviewer for that matter) that incorrectly reports market conditions can have their license sanctioned or yanked by the State.

Checking “Stable” vs. “Declining”

Question: When performing residential appraisal assignments I use
“standard” preprinted appraisal software forms. The forms ask me to
identify whether neighborhood property values are “increasing,” “stable,” or “declining.” I have been told that lenders won’t accept appraisal reports where “declining” is checked (even when this is an accurate analysis), so I usually check “stable” to accommodate the underwriting process. Is this a violation of USPAP?

Response: Yes. If the appraiser is aware that a market is declining and
intentionally reports it otherwise, he or she is in violation of the
ETHICS RULE. If an appraisal report indicates that property values are
“stable” when they are actually declining and the appraiser’s data
supports the conclusion of declining values, the report is misleading and in violation of Standards Rule 2-1(a). In addition, if the appraiser does not properly recognize that a market is declining, he or she may also be in violation of other requirements in STANDARD 1, as well as the
COMPETENCY RULE.