Millions of home appraisals to be available soon online

Nation's Housing

June 25, 2000|By KENNETH HARVEY

IF YOU REALLY want to understand the current market value of a house - your home, the place across the street, or a home 1,000 miles away - what do you really need?

Ask any lender or mortgage investor and you'll probably get the same answer: A professional appraisal. Forget the heavily advertised online pitches about "free" or low-cost valuations that promise to tell you what your house is worth but that are frequently far off the mark. Nothing is more authoritative than a professional appraisal, complete with actual measurements, detailed physical observations on the components of the property, plus examination of three or more directly "comparable" properties in the area.

Yet up until now, appraisals have been the critical missing link in the technological streamlining of the home real estate sale and financing process. There has been no easily accessible, national online repository of actual professional appraisal data available to anyone - not the general public, and not even appraisers themselves. There has been no appraisal analogue to the national credit bureaus that maintain detailed files on millions of individuals, and that are available online to loan officers with a couple of clicks of a mouse.

But that's all about to change radically. And in the process, some homebuyers and those refinancing mortgages could see the price of an appraisal drop from $350 or more to $75 to $100.

Others may see the time necessary to obtain a full appraisal cut by half, shaving precious days off the entire process of financing a mortgage.

Next month, the appraisal ballgame will begin to change when appraisers flip the "on" switch to something called "AIRD," the Appraisal Institute Residential Database. It will be the first-ever national electronic source of physical appraisal data on millions of homes across the country. When fully functional, according to Bill Rayburn, chief executive officer of the company that has designed the software to run it, AIRD will contain appraisal extracts on more than 90 percent of all homes in the 75 largest American real estate markets. In smaller markets and rural areas, the percentage will be significant but lower.

The data - to be accessible via a Web site called AIRDPort.com - will be siphoned from actual appraisals completed by licensed appraisers all over the country. Currently, professional appraisers may share their detailed property data with colleagues or regional real estate information firms. But relatively little of that proprietary data is shared nationwide.

AIRD will essentially connect thousands of appraisers' property files with the Internet via interface technology created by Rayburn's firm, FNC Inc., a software provider for the mortgage market.

It will also scoop up existing files of recent appraisals from regional databases currently in use.

And since the major contributors to AIRD will be the members of the country's largest and most prestigious appraisal organization, the 19,000-member Appraisal Institute, it's unlikely there will be any rival data source anytime soon. AIRD is a joint venture of the Institute and FNC.

Initially, appraisers themselves will be able to tap into AIRD to quickly locate "comparables" for either the actual on-site appraisals they perform, or for so-called "automated valuation model" (AVM) - the valuations they do for some lenders.

An AVM relies upon publicly recorded property sale information, and provides a quick, rough sense of the likely value ranges of a home. It comes with no appraisal data, however.

But when a quick-search AVM can be backed up with online appraisal comparables through the new AIRD online repository, appraisers will be able to sharply cut the price to the consumer of some of their work.

Alan Hummel, a Des Moines, Iowa, professional appraiser and board member of the AIRD project, says he will be able to charge just $75 to $100 - not $300 to $400 - when he can supplement an AVM estimate with appraisal data from the new Web site.

But the biggest attraction of the new service may well prove to be for individual consumers. For $5 to $10 a pop, you'll be able to go online, specify a street address, or a set of home-search characteristics - and see actual extracts of recent appraisals.

What will not be online to the general public, stress appraisers, is the sort of details that might violate the personal privacy of the homebuyer or owner who paid for the appraisal: comments on the condition and upkeep of the property, plus anything covered by state or federal privacy statutes.

Professional appraisers start online access to the national online database next week. Individual consumers curious to see appraisals done on the house down the street will have to wait a little longer. Public access to the Web site won't kick off until late this year.

Kenneth R. Harney is a syndicated columnist. Send letters care of the Washington Post Writers Group, 1150 15th St. N.W., Washington D.C. 20071.

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