Residential appraisal clients have slowly but steadily been requiring appraisers to include more and more data/information in our appraisal reports without allowing the appraiser to negotiate their fee. This is a phenomenon known as "data creep."
For example, how many of your clients require the cost approach? The cost approach, though useful with the appraisals of new construction, is not required by most lenders. Though the option to prepare the cost approach still must be considered by the appraiser,
the preparation of the is approach does consists of time and the accessibility to reliable data. Time is money, and the data is not free. Marshall and Swift is not a free publication. How about the requirement to disclose in the appraisal the parameters
utilized in the comparable search? How about the inclusion of an aerial photo in the appraisal, or the inclusion of the engagement letter in the appraisal report? Why does one client pay the same fee as another client, but one does not require the cost approach,
or the inclusion of the comparable search parameters, or an aerial photo?
Most appraisers strive to continue to improve the quality of their appraisal work. To prepare a well thought out and informative work product is at the front of our minds when we are prepare an appraisal. But the data creep phenomenon will continue to
be pushed by many clients until the appraisal industry demands additional fees for the requirement of additional information in our appraisal reports.