8A — September 14 - 27, 2018 — Appraisal — Financial Digest — M id A tlantic
Real Estate Journal
By Michael Tucker CRE executives report 'balanced and stable' conditions, concern for future
ommercial real es- tate executives see "balanced and stable" market conditions despite growing concerns the market could be nearing the end of its current cycle, the Real Estate Roundtable reported. The Roundtable's third quarter Economic Sentiment Index registered at 52, up one point increase from the second quarter. The current- conditions index score in- creased four points from the previous quarter to 56, up 5 points from a year ago. "As we move into the sec- ond half of the year, we C
Recent AppRAisAls The report said the positive snapshot of current commer- cial real estate markets re- flects a g eral absorption of recent interest rate increases and overall economic stimula- tion from tax reform. But looking ahead, there is growing sentiment the in- dustry is nearing the end of continue to see robust mar- kets, with debt and equity available and asset values strong," said Roundtable CEO and president Jeffrey DeBoer. "The commercial real estate industry remains confident for the remainder of 2018."
its current cycle, the report said. The future conditions in- dex score, 49, is seven points below the current conditions index. Most respondents sug- gested asset values have reached their peak for many property types, especially in major gateway cities. Though debt and equity cap- ital sources remain plentiful, respondents expressed some concern about the amount of debt available and the ramifi- cations of the mounting time pressure some lenders have to invest their capital. Survey respondents said they view property supply
and demand metrics as bal- anced at the moment. Some cited "pockets" where the balance is slipping but felt general market conditions remain positive barring an unexpected event, the report said. Nearly half--49 percent--of survey participants reported seeing asset prices as about The Appraisal Institute attended and hosted several meetings this spring concern- ing the government-sponsored enterprises’ appraisal policies.
the same as one year ago and 47 percent said they expect values to be nearly the same in another year, reflecting the view that primary markets will likely maintain peak pricing for many property types. But the industrial sec- tor still has "room for growth" through 2019, the report said.
Appraisal Institute weighs in on modernization of GSE Processes, Forms
Fannie Mae and Freddie Mac separately are making chang- es to their appraisal policies and procedures while working together on changes to their standard appraisal forms, as mandated by the Federal Housing Finance Agency. Representat ives from Fannie Mae attended the AI Government Relations Committee meeting in May in Washington to gather in- formation on current issues affecting appraisers and to find out what future issues may lie ahead. Following the meeting, the AI GRC prepared a written response to their questions. Concurrent and separate from that meeting, the Se- attle and the North Texas AI chapters hosted listen- ing sessions with Freddie Mac officials to discuss the modernizing processes at the GSE. AI’s Greater Ten- nessee Chapter will host a similar listening session on Aug. 1. Separate from those meet- ings, AI officers and AI GRC members met with and talk- ed to officials from both GSEs to discuss updates to appraisal forms, which is a joint undertaking — unlike those for processes and pro- cedure policies. AI offered suggestions on a range of issues, including ways to re- vise the forms so they focus less on rules and process and more on appraiser analysis and how to reduce appraiser and lender liabilities. Both projects — which could take several years to complete and implement — have the potential to signifi- cantly impact the valuation profession and those who use appraisal services.
Wade Appraisal, LLC delivers value-added services to clients through diligent research, analysis and well-documented, unbiased opinions. Specializing in commercial, industrial, multi-family and special purpose properties and can handle all of your appraisal needs.
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Gary M.Wade, MAI, principal ofWade Appraisal, LLC, gives his personal supervision to every client project. He has been appraising commercial real estate since 2004.
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