Mid Atlantic Real Estate Journal — Financial Digest — April 12 - 25, 2013 — 13A
www.marejournal.com
A ppraisal I nstitute
The Coalition of Pennsylvania Real Estate Appraisers Changes in real estate valuation proposed
T
he appraisal stands as one of the most impor- tant benchmarks in
rigorous comprehensive ex- amination, in order to prove they have the skill sets needed
developed by a person that is competent, qualified and independent .
State of Pennsylvania cares little about oversight and enforcement in the mortgage and real estate sectors. At a minimum, it will place con- sumers and neighborhoods struggling with distressed properties at risk and cause confusion among those seeking valuation products. As for long term effects, the still-ongo- ing national economic crisis should teach us some lessons about the dangers of lowering established standards. In response to this, the Co- alition of Pennsylvania Real Estate Appraisers (CPREA)
was formed in late 2012 by the five Pennsylvania Chap- ters of the Appraisal Institute and other interested appraisal professionals to be the unified voice of real estate valuation in Pennsylvania. The goal of this organization is to ensure the protection of all consumers by promoting accurate, reliable, and independent real estate valuation services. The Coalition of Pennsyl- vania Real Estate Appraisers will be working actively on this legislation. If you would like to join our efforts, please visit our website. n
valuing real estate. However, under legislation initiated by the Pennsylvania Association of Realtors being circulated in Harrisburg, brokers and sales- persons would be permitted to expand their current roles as advocates for buyers and sellers into providing opin- ions of value for a myriad of important financial decisions regarding real estate. Currently, the Real Estate Licensing & Regulation Act (RELRA) allows real estate brokers and salespersons to perform Comparative Market Analyses (CMA) only for the purpose of determining the asking/offering price or secur- ing a listing. Further, they must state the “analysis was not performed in accordance with USPAP which requires valuers to act as unbiased, disinterested third parties with impartiality, objectivity and independence and without accommodation of personal interests.” Broker Pr i ce Opini ons (BPOs) are not legally recog- nized in PA law. However, a BPO is equivalent to a CMA. Neither CMAs nor BPOs are authorized outside of the real estate sales context. For some applications, BPOs have become popular as low cost, quick alternatives to an appraisal in many areas of the country. To the untrained eye, a BPOmay look verymuch like a real estate appraisal but the individual providing a BPO lacks the training, education or experience in real estate valuation required of certified real estate appraisers. Real estate valuation re- quires training and education – the proposed legislation provides no requirements for either. A “newly minted” salesperson with only 60 hours of real estate education and a passing score on an online examination, could begin of- fering CMA/BPO services for lenders on multi-million dollar strip malls, shopping centers, and office buildings on the first day that they hold a salesperson’s license. On the other hand, under current law, Pennsylvania mandates that real estate valuation profes- sionals take hundreds of hours of education, accumulate thou- sands of hours of experience, and then pass an extremely
The goal of The Coalition of Pennsylvania Real Estate Appraisers is to ensure the protection of all consumers by promoting accurate, reliable, and independent real estate valuation services.
to do valuation work. All us- ers of real estate valuation services deserve the assurance that the information that they are being provided is accurate and credible, and has been
If the draft legislation being circulated in Harrisburg is enacted into law, it will forever alter real estate valuation in Pennsylvania. It will send a shocking message that the
The Coali�on of Pennsylvania Real Estate Appraisers was formed in late 2012 by the five Pennsylvania Chapters of the Appraisal Ins�tute and other interested appraisal professionals to be the voice of real estate valua�on in Pennsylvania. We are a non-profit organiza�on whose goal is to ensure the protec�on of all consumers by promo�ng the use of accurate, reliable, and independent real estate valua�on services. This goal is furthered by ac�vely monitoring relevant legisla�ve ac�ons at the state level that affect the valua�on community and the public.
Promo�ng Responsible Real Estate Valua�on
CPREA’s Objec�ves
• Work to promote the appraisal profession and its image to the general public and to all users of appraisal services.
• Ini�ate discussion and analysis of issues affec�ng professional appraisers.
• Monitor poli�cal ac�on with the intent to influence legisla�on, regula�on and public opinion toward the appraisal profession, by iden�fying the Pennsylvania appraisal profession as an iden�fied, collec�ve voice in the legisla�ve and regulatory debate.
• Represent a professional appraisal “consensus” to the Pennsylvania Legislature and relevant state regulatory agencies.
• Provide a legisla�ve and regulatory liaison to associated professions and industries.
• Provide ongoing, �mely informa�on about relevant legisla�ve and regulatory events.
• Create and maintain a method of funding through contribu�ons to make the coali�on self-sufficient.
489 Devon Park Drive, Suite 309 Wayne, PA 19087 Contact@CPREA.org www.CPREA.org
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