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How have home appraisals changed since the pandemic began?

he coronavirus pandemic has changed so much about how we live and work,

Tand that now includes how real estate appraisers do their jobs. When much of the country was shut down due to shelter-in-place and self-quarantine orders earlier this year, appraisers had to adjust to a new reality in which they couldn’t enter individuals’ homes. And even now that daily public life has begun to resume, the appraisal industry has adapted, bringing some changes that are here to stay.

Brett Bessell, a GCAAR member who has been doing appraisals for the past 28 years in the region, says he was unsure in March if he would even be able to keep doing his job. “We weren’t even sure we were going to be able to do appraisals, until the government deemed us an essential business,“ he says. “Since then, we haven’t missed a day.“

“We weren’t even sure we were going to be able to do appraisals, until the government deemed us an essential business,” he says. “Since then, we haven’t missed a day.”

The most obvious change to his routine has come in the form of masks and gloves, now a commonplace, if not mandatory, part of going out in public. Additionally, Bessell will typically call ahead before entering a home, and ask the homeowners or occupants to “turn on all your lights and open all your interior doors.“ That way, “we won’t have to touch anything while we’re in the entire house,“ he says.

In some minor ways, he adds, the work has gotten easier since the pandemic hit the U.S. That’s because there are fewer people on the roads during rush hour, making it easier to get to each house. And people are more likely to be at home, working from home, Bessell notes, meaning scheduling an appraisal is a lot easier in the first place.

On the financial side, the appraisal process has also had to adapt to the pandemic. Fannie Mae, among other lenders, began allowing appraisers more leeway to do what is called a “Fannie Mae exterior alternative,“ in which appraisers can drive by a home, take photos and exterior measurements, and then fill out their appraisal forms with disclaimers indicating that they were not able to go inside the home. This newfound flexibility for appraisals is atypical, but became essential to keeping business moving during the earliest stages of the pandemic.

John Hansen, an appraiser who has worked in the district for the past 35 years, says he has been conducting many more exterior-only appraisals than usual due to the pandemic.

“Most of my clients have requested that occupied homes be appraised as exterior-only (to protect the occupants and the appraiser),“ he says. These are not the “drive-by“ appraisals of the past, he notes; Hansen will visually examine and photograph all four sides of a prop-

erty, measure the exterior of the house, download photos the agent has uploaded to the MLS and interview the agent for details about the property’s interior features and updates.

Appraisers are also able to perform a “desktop alternative,” in some cases, meaning they appraise a home without visiting it in person at all, based on information from comparison homes that were recently sold and photos provided by the borrowers. This has been most common, Bessell says, when it comes to home refinancing, as opposed to sales. Hansen says he handles mostly sales and has not had any clients request a desktop alternative this year.

Refinancing is big right now, according to Bessell, thanks in large part to low interest rates and low inventory. He estimates that over 75% of his appraisals are refinances at the moment.

He pointed out one other consequence of the pandemic that has affected the appraisal business: Low housing inventory means it’s harder for appraisers to find enough active listings to put in appraisal documents, so fewer lenders are requiring appraisers to provide information on at least two active listings.

Overall, Bessell says his day-to-day work life hasn’t changed as dramatically as things initially seemed. He’s taking extra precautions and trying not to touch surfaces inside the homes he appraises, and of course, he needs lots and lots of hand sanitizer. “I haven’t had a handshake in quite a while.“

Hansen is optimistic that any changes to the appraisal business will be temporary, as people continue to adjust to the new normal.

“I expect things to return to the way they were soon,“ he says. “Probably this autumn or winter.“