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Do you have an Appraiser Larry?

I love my appraisers.

See that little fella there to my right? He is an Appraiser. Let's call him Appraiser Larry. I love Appraiser Larry. Do you know why? He keeps me out of trouble! And how!!!

When I take a listing in North Carolina, my board of Realtors tells me that it is my responsibility to give accurate information on the home from the moment I list it. This is due to buyers needing accurate information so they can put forth an offer with confidence. So, one of my first phone calls when I get a listing is to call Appraiser Larry so he can carry the liability on the measurement of this home. Let's face it. Appraiser Larry measures and appraises A LOT of homes every day. I sell A LOT of homes. It just isn't the same thing.

Of course, there is a small charge associated with this phone call My appraiser charges $50.00. He measures the property, he gives me a darling drawing that I can stuff into my brochures for the home. All that for $50.00!! My appraiser is a bargain. Now I can list the home for my sellers and have the piece of mind that our buyers can bring an offer with confidence.

If you need to sell a home in North Carolina, call me! I will take care of all the details!

Posted by Virginia Halter Broker, ABR, CRS on 01/09/2008 04:24 PM

Comments (27)

seller representation, seller advice, cabarrus county real estate, north carolina real estate, virgini halter

Post is included in group: North Carolina Real Estate
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27 Comments on Do you have an Appraiser Larry?

JAN

2008

I use a measuring company but never thought to have an appraiser measure the listing. Never knew they would do that outside of a full appraisal! Thanks for the insight!

I would not take on the liability of measuring a listing for all the tea in China, especially with the cut outs on the second floors these days. No way! Those discrepancies can get you taken to the board. No one wants to go in front of the board!

For a more accurate assessment on the condition of the property you might want to think about having a pre-listing inspection done by a qualified home inspector. It would cost more than $50, but could help you and the seller avoid problems that may occur when the buyer has it inspected. Also a great marketing tool.

I like both of those ideas of having the home not only professionally measured, but also to have a pro inspect it as well. The inspection can help 2 ways.

1. It can alert the homeowner to potential problems that they may not be aware of, especially in the attic and crawl spaces.

2. If a problem is found it can be addressed and taken care of.

These reports then can be shared with the new buyer so they can make an offer with confidence,

Good point Brian. The majority of home owners are not aware of existing problems. When they are informed of them they can have them repaired before listing their home. Really, how many owners get into the crawl space or unfinished attics.

For myself, I advise clients to have a pre-listing inspection if the home is older than ten years or if the wear and tear seems excessive. I don't likefor sellers to get blind-sided by a rotted sill band or anything else that can dramatically change your closing costs.

I had a buyer a couple of years ago who put an offer on a home that was 20 yrs old. There was about $20,000 of termite damage and still had active termites. The homeowner had no idea, insisted everything was fine, and refused to fix anything. To this day, I hate that my buyer had to pay for her to be aware of her own home. But hey, it saved him a pile of trouble and turmoil if he had bought it.

Christopher - As far as crawlspaces, I leave that to the experts. It would do me no good to go crawling around under my crawlspace! :- )

My crawl space is scary. My old furnace guy finally told me that I had 2 choices. Get a new furnace and move it up to the main level, or get a new furnace guy...I can still remember hearing him cussing down there repairing that old beast...he got his wish, new one upstairs, and much cheaper to run

I learned a long time ago not to do my own measurements. My MLS allows us to use the tax records furnised on line. Nice idea to put the responsibility on the appraiser. Great post.

According to that little yellow measuring guidelines booklet the NCREC gives out as part of their Broker classes (you know those three 90-hour classes) the appraiser can measure the home but you as the agent is still liable for the accuracy so even if he measures the house for you, it doesn't transfer the liability.

Of course, you do know you don't have to report the measurements at all in NC don't you? Unless you are required my your local MLS board, according to the state, we do not have to report the measurements, but if we do, then we're liable for the accuracy of it.

Either way, I don't blame you for hiring an appraiser, but just because you hire one doesn't mean the liability is now on the appraiser's shoulders.

KAY - Thank you for stopping by. I haven't been on in a while but I am trying to get back to it! This was too good to pass up!! What Realtor would add that liability to our heavy load?!

Brian - I hate that for you. New furnace ALERT ****Get new furnace****

BILLY BOB - What fun to have you chatting with us this eve'nin. Yes, we do have to report sqwar futage in our neck o' the woods (Charlote MLS requires it per home and per floor but not per room), BUT I wuz also told at my CE classes that transfer to an appraiser gives them that liability. I don't know if that is according to my MLS or not. BUT that is what is being taught. As long as it is measured by a licensed appraiser, they take liability for the measure. I will definitely discuss this with my BIC tomorrow afternoon.

Sleep well you all!!!

The MLS may allow it but not the state. Think about it like this. If the appraiser messes up and the buyer discovers the home is smaller than reported and files a complaint with the NCREC, guess who they are going after.

Who did you do your classes with up there in the Queen City?

As for asking your BIC, he/she probally has no idea about that issue than the rest of us does. The best bet would be to call the NCREC and ask to speak with Patricia Moylan and see what she has to say. She does most of the law stuff and wrote most of the stuff in that big fat gray book that they are using for the full broker classes.

Well I have heard it taught both ways. One CE instructor said using an appraiser passes the liability because of the states rule that a broker can rely on the measurements of an appraiser. Another CE instructor gave the same information as Billy Bob. (Both instructors were at the Mingle School in Charlotte.) Either way using an appraiser is a good idea. If the appraiser's measurements are wrong and you are sued, you could then sue the appraiser to recover your losses. Any way you look at it, the buck stops with the appraiser.

I am a Certified Appraiser as well as a licensed Broker here in NC. $50 sounds about right for a sketch of most houses, although some of the larger and more complex designs probably ought to be a bit more. I really enjoy measuring and sketching houses as most appraisers do, and like most appraisers I am very good at it. Give an appraiser a call for your next listing. I think you will be very pleased with the results.

JAN

2008

Well, there's an interesting disparity:

Who has the liability?

My knee-jerk reaction, based on my training, was that the Listing Agent cannot "pass" liability to the appraiser/measurer, and then I read on.

I measure my own listings, but would consider paying $50.00 to an appraiser if my knee-jerk reaction is wrong.

I took a fresh look at the guidelines, and I believe that in some sense Billy Bob is correct. The rule says:

When an agent relies upon measurements and calculations personally performed by a competent appraiser or a more expert agent, the appraiser or agent must use these Guidelines or other comparable standards and the square footage reported must be specifically determined in connection with the current transaction. An agent who relies on another's measurement would still be expected to recognize an obvious error in the reported square footage and to alert any interested parties.

So an agent can't simply use a measurement from an appraiser that is obviously wrong. To me that would mean the appraiser's sketch should look like the house and the measurements look in range of a visual estimate. To the real estate commission it could more, I would think individual cases where they have ruled would be the place to identify what they believe is obvious.

I take all of my CE at Superior School of Real Estate. I would go no where else, ever! I will be calling Ms Moylan to ask about it. I am still (either way) going to stick with my Appraiser Larry because he has never steered me wrong. And I can say for certain, that his measurements will be far more accurate than my own. Besides, who has that kind of time.

I suppose Greg could be right, if a measurement is wrong then I could sue the appraiser in question. Maybe that is how I came to the conclusion that it takes away my liability. But a lawsuit just sounds tiring, doesn't it?

This post was inspired by a transaction where the listing agent ( I had the buyers) listed the sq footage on MLS straight from tax records, after we came to contract she measured the home herself and was off from tax records but not by much. When we had a professional appraiser measure, the sq footage originally listed was a healthy 8% more than what was really there. I find that to be very irresponsible on the listing side. $50.00 could have gotten a real measurement from a professional in the field.

I agree with Greg also, But keep in mind, if the measurements are wrong the NCREC goes after you and your license not the appraiser's. The NCREC cannot find us either so all they can do is stuff with our license if a consumer makes a complaint.

Of course, the consumer can sue you and you can then turn around and sue the appraiser, but by that time, you may not have a real estate license.

I went to J.Y. Monk in Greenville for my Provisional license, then took the first course for bull broker in their Raleigh location and the other two back in Greenville.

I use the tax records, which include a diagram of the property here in our county. In one or two cases I state the home does not match the tax records. I also provide a building permit package, so they get a history of the permitted work done on the home.

Randy - I hadn't thought about a permit package before. I do try to get copies of permits for additions. In our area, tax records are wrong about 95% of the time and they have no diagrams. That would be nice though!

Billy Bob - I continue today getting conflicting info about this. I have searched for Patricia's phone number and am not having luck today. I would think, however, that the NCREC isn't "out to get us." If we have gone the extra mile of hiring a licensed appraiser to professionally measure a home then I do think that at least shows some due diligence being followed.

The Residential Square Footage Guidelines are fairly clear, but it is not obvious what the NCREC considers an obvious error. One thing that is quite clear is that using tax records would be unwise.

Some sources of square footage information are by their very nature unreliable. For example, an agent should not rely on square footage information determined by the property owner or included in property tax records. An agent should also not rely on square footage information included in a listing, appraisal report or survey prepared in connection with an earlier transaction.

It the guidelines are quite clear that tax records are not considered reliable, and should not be used. Unless the error is something like including rooms that don't exist or a measurement for a wall is listed as 60' and you can reach both ends with your hands at the same time, I doubt the Commission would find a broker negligent if they relied on an appraiser they paid specifically for the purpose of measuring for that listing.

Remember, an appraiser will not just measure and tell you a number. A good appraiser will give you a sketch (in both PDF and JPG formats) with all the measurements marked and a separate sheet showing the calculations that were used to get the size. I would think an obvious error would be one that would leap off the page for anyone who knew the house. At the most an agent might want to measure a wall or two inside the house with a sonic or laser measuring tool to check against the sketch. Certainly far less than the whole house and all the calculations.

Because appraisers measure and sketch houses on a daily basis, we are far more efficient at it, and can afford to buy the best software and measuring tools for the job. If one hires a good appraiser to do the measuring, it is highly unlikely there will ever be an error to cause anyone concern.

Wow, missed a lot of discussion! I thought the ncrec guidelines said if you include a number for square footage there's a 5% margin of error that you have to be within. I don't think having an appraiser measure takes the agent's responsibility away but I completely agree I am by no means an expert measurer myself!

Yep, you are correct Diane, there is seldom complaint if the measure is within 5%. If every house was a ranch style home, maybe I would take my own measurements but with so many of the two story family rooms and curvy staircases and rounded walls...that just makes my head hurt. I have found an appraiser whom I trust. I agree with Greg, I get a purdy drawing of the home with all of the numbers. I put that in my brochure for the home and I sleep better at night because of it.

I have to say that I have learned from this conversation and I am still trying to get in touch with the woman from NCREC to clarify somethings for me. I love Active Rain!!!!!

Isn't her number or email listed on the NCREC site anywhere? I have never talked to her myself, but that is who my instructor told us to always pick up the phone and call when we ever had any doubt about any question.

I haven't been to the NCREC site since last year (I am inactive - I rather do history and write books) but I would assume her contact information was on there somewhere.

Being a history major at ECU and all that, most of us are pre-law, so if you ever find an answer, let me know. Billy Bob will debate the living tar out of it if given a chance. Heck, Billy Bob is gonna run for NC House in 2009 in his district too so he needs to work on his debating skills :-)

JAN

2008

Nope, I will contact Bill Gallagher today and get her email or something. When I try to search for her on the NCREC site it says the search is in construction. That's okay, I am used to new construction. HA HA HA HA. I will let you know after I get some confirmation.

JAN

2008

That is a great idea and it is way too often when I bring a buyer in that I have to tell them that what they say on the listing is just not possible for square footage. Then sure enough when the appraiser comes around from the bank he says the same thing I said and then we have a problem with it appraising for the loan.

Todd - Listing agents are responsible for that. You hate to be "mean" but it is our responsibility to take the best possible care of our buyer clients. Calling the listing agents on square footage and bringing it to the board's attention may be what it takes to improve our industry. Every single improvement counts! Our buyers depend on us for that!

Virginia - I would LOVE LOVE LOVE it if more agents were like you. I've come across so many agents in my time that actually think they are appraisers, it's drives me bonkers! Glad to see there are professionals out there that know we are each a professional in our own field!

JUN

2008

That is an expensive service, however what a great way to make sure your listing information is credible.

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