City of residence: Warner Robins
Occupation: President, Donofrio Appraisal Associates Inc.
QUESTION: Whats the role of an appraiser?
ANSWER: I appraise the value of real property. Real property is anything permanently affixed to the Earth, such as a house or commercial building, landscaping, that sort of thing.
QUESTION: Who does an appraiser appraise for?
ANSWER: In most cases, its for banks so that theyll have an idea how much money they can safely invest in a loan.
QUESTION: Technically, who do you work for?
ANSWER: Were not supposed to advocate for a homeowner, buyer, bank or anybody. I dont really work for banks or anybody; I work for the appraising profession. The DoddFrank legislation of 2010 requires all lenders to use an unaffected third party, so they have to go through a third-party appraisal management company to hire appraisers. I get an order and deal with the facts, and thats all.
QUESTION: What are you looking at when you do an appraisal?
ANSWER: I evaluate the property in its present condition. I look at whats there, the quality and workmanship of the property, whether its residential or commercial.
QUESTION: First, what issues do you run into related to commercial properties?
ANSWER: Actually, its the confusion in commercial appraisals that people think since they are making all this money in their wonderful business that should figure into my appraisal. But Im just looking at real property involved -- the building -- not the value of the business venture.
QUESTION: How do you go about a residential appraisal?
ANSWER: I measure the house and observe its condition. First the exterior, and I see if theres any physical damage, or if its in good condition. I notice the age of paint, how old components such as air conditioning are and make an accurate sketch of the house. Inside I observe and make notes on things like ceiling height -- a 9-foot minimum indicates better quality construction -- and look at trim, extent of decorative trim, floor coverings and other such things.
I check to see if the floor plan is functionally what it should be and if portion of it is below grade. That technically makes it a basement. I note such things as well as when it was bought, how long it was lived in, what improvements have been made, that sort of thing. And thats most of it on site.
QUESTION: What do you do with your information?
ANSWER: I take it back to the office and put it on computer. I create the floor plan, input all the factual data into a pretty straightforward form and work on information related to house quality and condition, neighborhood and condition of the market there. I work on comps.
QUESTION: What are comps?
ANSWER: Comparables. In order to determine value, you have to look at comparable houses in the area and see what they sold for. Of course, youre looking for similar location, square footage, rooms and other features. You have to find comparable homes as close as you can to the original, but you also may have to make plus and minus adjustments for differences. There is judgment involved, but its all very straightforward, too. One thing I like about this job is I can base everything on facts. Im very careful just to use what I can factually document when arriving at a value.
QUESTION: What other major factors might you consider?
ANSWER: Well, a big factor these days is whether or not the property is in foreclosure. Theres a section to discuss that. You cant compare the price and situation of a regular house for sale with one for sale that is in foreclosure. That definitely has to be addressed.
QUESTION: How do banks look at your results?
ANSWER: Thats interesting because every case and every house is different, but, of course, banks want to look at things in the same way across the board. Banks feel safer when everything conforms. Thats one reason we use comps and similar homes and structures as close to the area as possible. We also try to bracket results and end up with the best information.
QUESTION: Though its very factual, dont you have to have an eye and feel for appraising property?
ANSWER: What Ive found in 19 years as a licensed appraiser with a top certification in Georgia is that, yeah, you do get a feel for it and values and what adjustments are. Youre doing the same thing over and over but adjusting it to age, location and all the other factors. An appraisal is a lot like one of those word problems you had as a kid where a train leaves Chicago going 60 miles an hour.
-- Michael W. Pannell