Real estate appraisal is shaping up to be a rewarding career option if you’re interested in it. In the US, its employment rate stands at 14 percent, double the overall employment rate for all careers. The median gross income for residential real estate appraisers was $54,980 in 2018, a 22% increase from $42,500 in 2016.
In real estate appraisal, you can choose to be employed or own your own business. As a field job, you have a break from sitting at the desk all day. In addition, your payment is fee-based, which means you get paid whether or not the house is bought.
This article highlights how to become a real estate appraiser in the US. It includes education, experience, certification and any challenges that the career faces.
Step 1: Education
You are required to complete basic appraisal education, which is divided into four parts (79 hours total):
- Basic Appraisal Procedures – 30 hours
- Basic Appraisal Principles – 30 hours
- Universal Standards of Professional Appraisal Practice (USPAP) – 15 hours
- Supervisory and trainee class – 4 hours (effective January 1, 2015)
However, some states have more coursework hours before you can become a trainee. Examples include 150 hours in NY, CA and WV, 110 hours in CO, 100 hours in FL and 90 hours in NC, TN, KY, and GA.
At the end of this, you become a Trainee Appraiser. You must work under the supervision of a Certified Residential Appraiser for 1,000 hours before applying to be a Licensed Residential Appraiser. Keep your work log as it will be reviewed by the state regulatory board when you apply.
Some states require that you pass a Trainee Appraiser exam, but most don’t (check your state requirements).
Once you have the experience, you can apply for your license, which allows you to perform appraisals alone. At this point, you have an additional 75 hours of education to complete in four courses, namely:
- Residential Market Analysis and Highest and Best Use – 15 hours
- Residential Appraiser Site Valuation and Cost Approach – 15 hours
- Residential Sales Comparison and Income Approaches – 30 hours
- Residential Report Writing and Case Studies – 15 hours
Some institutions offer these courses online to make things easier for you.
Step 2: Experience and Examination
As a trainee appraiser, you are required to complete 1,000 hours of appraisal work under supervision. This should be done in six or more months. Trainees can work in real estate appraisal firms, although opportunities are few and competitive.
Go to the state website and print names of all appraisers near you, then call them to see if they have openings. Banks also need appraisers, but because they may have a lighter workload, it’ll take longer to complete your 1,000 hours.
For your license, some states require supplementary college-level coursework or an Associate’s degree or higher before granting a license. However, the minimum Appraiser Qualifications Board (AQB) standards do not require it, and many states don’t ask for more.
Once you qualify to apply for a license, you’ll have to sit and pass a real property appraiser examination. It includes legal considerations, appraisal math, types of value and real estate markets, among others. You must pass this exam before submitting your license application.
Once you become a Licensed Residential Appraiser, you can conduct appraisals alone. However, this is limited to 1-4-unit non-complex residential properties worth no more than $1,000,000. You can also appraise 1-4-unit complex properties worth no more than $250,000.
To appraise buildings above these limits, you’ll have to complete additional coursework and experience. Then you apply to become a Certified Residential Appraiser.
Step 3: Getting Certification
Once you become a Certified Appraiser, you’ll be more marketable and able to appraise properties worth above $1,000,000. Banks, for instance, prefer Certified Appraisers over their licensed counterparts. You can work for a few years before applying to become certified.
To get certification, you must fulfill the following requirements:
- Coursework – over 200 hours of AQB-certified coursework. Previous coursework counts within this total, so you only need to make up the difference
- Experience – at least 1,500 hours of appraisal work done over no less than one year (trainee work is included)
- Education – you must have a bachelor’s or associate’s degree or complete 30 hours of college-level education
Note: States apply different standards for licensing and certification, so it’s essential to find out what your state requires.
Once you are certified, you can appraise 1-4-unit residential properties of any value or complexity. You may also appraise unimproved or vacant land suitable for 1-4 residential units. When buying a unit as an agent, you need to focus on every detail when appraising as it is easy to say, “we buy any house.”
For land and buildings bigger than 1-4 units, you must have additional certification.
Certified General Appraisers can appraise any kind of real estate property – residential, commercial or agricultural. To be certified, you must fulfill the following:
- At least 300 hours of AQB-approved education or higher
- At least a bachelor’s degree or higher
- At least 3,000 hours of field appraisals done in no less than 30 months. This must include 1,500 hours appraising non-residential properties
Before applying, be sure you meet the above requirements to avoid rejections.
Challenges You May Face
While there are perks to choosing this line of work, it does not come without its challenges. Some of them include:
Finding a Mentor Is Difficult
Consider that training an appraiser is essentially increasing your competition in the market. Therefore, some licensed appraisers refuse to take on trainees or make it difficult for you to log your hours. Others offer very little pay or do shoddy work so that you don’t really learn.
Logging Required Hours Takes Long
Logging 1,000 hours of work isn’t easy, even though AQB made those requirements easier (it was 2,000 hours over 12 months before). Often, you won’t spend a full work-day on an appraisal, and office hours don’t count. In a slow work environment, it takes even longer.
It pays to choose a busy office so that you can log your hours within the shortest time possible.
Some Jobs Require Certification
Most of the well-paying deals require certified appraisers, which is a kind of vicious cycle. You need work to get a certification, but you can’t get work because you don’t have certification. Still, you can get smaller clients with less stringent requirements until you log the requisite hours.
How to Become a Real Estate Appraiser – Final Thoughts
Now you know everything about how to become a real estate appraiser. Getting the right mentorship and education is crucial to succeeding in this industry.
Therefore, choose your educators and mentors wisely. Even if you start slow, with patience and hard work, you can get to the top of this career path.
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