Like REALTORS®, appraisers rely a lot on their senses when analyzing a property. Many real estate professionals count on Appraisal Institute of Canada (AIC)-designated appraisers for professional, comprehensive and unbiased valuations to assist them in helping their clients make well-informed residential and commercial real estate decisions.
So, what happens when you take two crucial senses—smell and sight—away from the equation? The COVID-19 pandemic limited how appraisers across Canada could evaluate a property, so under these new strict social distancing guidelines, could the job even be done effectively?
Keith Lancastle, Chief Executive Officer of the AIC, seemed to think so, even if the methods of evaluation had to be drastically changed in the first few months.
“One of the things we did early on as soon as everything started to unfold, was we looked at what flexibility our members had without going into a home,” Lancastle said.
“It’s amazing on how much we rely on all our senses when reaching a decision. For example, you walk into a property and there’s a musty smell, so you poke around a bit and find mould. You can also find problems due to pet odours or smoke in the house, or small scratches on the hardwood—all these things can add up. Overall, though, it’s fair to say the new way has worked reasonably well for most people in most situations, but there’s nothing comparable to physically being inside a property.”
While the AIC has always been able to rely on third-party data for appraisals, that type of info became invaluable. Reference materials such as Board MLS® System pictures, Municipal Property Assessment Corporation assessment data, as well as personal pictures and videos the owner had of their property all allowed appraisers to do external observations without having to physically step foot on the property.
“We didn’t want the appraisal process to be the bottle neck in the whole real estate transaction process, but in the same breath, we recognized our members had an exposure risk, as do REALTORS®, so we needed to balance public health guidelines with the desire of wanting to move business forward.”
The AIC has roughly 5,000 members, making up about 80% of property appraisers across the country. They specialize in all kinds of property types, from residential and commercial, to rural and institutional.
In the age of COVID-19, Lancastle said AIC-designated appraisers can assist real estate professionals with some common questions that clients may be asking themselves, such as:
- What will I do when my mortgage deferral has expired?
- How do I unlock financing through equity in my home?
- Has the value of my home increased or decreased?
- Is now the best time to buy or should I wait?
- What is the real value of the property I want to purchase?
- Between working from home and more family at home, what is the best approach to renovate or expand my home?
Lancastle said AIC-designated appraisers can provide appraisals for financing, refinancing, renovations, additions or extensions, and to help determine pre-sale market value.
If you’re looking to hire an AIC-designated appraiser, Lancastle shares the following tips:
- Ask the appraiser for their professional designation. Be sure the appraiser is a member of reputable professional association such as the Appraisal Institute of Canada. Go to AICanada.ca to “Find an appraiser.”
- Ask the professional appraiser about his or her qualifications; ensure the AIC member holds either the Accredited Appraiser Canadian Institute or CRA Canadian Residential Appraiser designation or is an AIC Candidate member.
- Ask the professional appraiser about his or her experience and expertise in the valuation of your type of property.
As for next steps, as the country re-opens, Lancastle said first and foremost his advice to appraisers is to follow public health guidelines. He said the AIC is limiting interpersonal contact for the “foreseeable future.”
“Those who adapt and look for opportunities are going to do well, and I think that’s straight across the board. I’ve been pleased with how we’ve been able to help our members adapt and support them throughout the process. If we would not have had the ability to adapt, things would have been remarkably different.”