Appraisal modernization is definitely a hot topic within the industry moving forward. Phillip King, vice president, valuations product management for ServiceLink, outlined his beliefs as to how the profession has truly modernized in so many ways.

King serves as a subject matter expert for EXOS Valuations and is responsible for developing its product strategy and digital roadmap. He has been in the appraisal management industry for more than 20 years and has been with ServiceLink since 2009, holding several operational management positions throughout his time with the company.

King discussed some of the steps taken by the appraisal profession to modernize itself.

“Quite a few steps have been taken over the years by the appraisal industry to modernize. A few that come to mind include digital cameras replacing the need to physically develop and attach photos to paper appraisals, digital measuring devices replacing traditional tape measures, the internet providing everyone with access to data to eliminate the need to pull records manually, etc.,” King told Valuation Review. “Fast forward to present day, and this widespread access to digital data has ushered in a new era of appraisals, enabling the appraisal to be conducted remotely, via desktop, or through virtual inspection technology, which enables a self-serve approach from the borrower or another trusted third party by leveraging a device (mobile, tablet, etc.) and AI and machine learning. I am encouraged by these innovations and look forward to the continued momentum in the appraisal industry.”

As to how significant desktop and hybrid appraisals have been regarding this modernization, King said that desktop appraisals are a “positive step” in getting a valuation without the delay of visiting the property. The key with this method, he pointed out, is having the right data and images available to the appraiser to provide an accurate, reliable appraisal.

“Hybrid appraisals will get us another step closer to modernization by allowing the appraiser to complete a valuation without personally visiting the property,” King said. “Through mobile app technology, we can capture data and images of the property and surrounding area so that appraisers have sufficient information to complete an appraisal remotely.”

Of course, the pandemic accelerated many a process in the majority of businesses. Appraisal modernization felt the COVID grip, as well.

“The pandemic accelerated the modernization process in several ways. For example, interest rates dropped to record levels and refinance volume skyrocketed,” King told us. “As a result, we saw an increased demand for valuations to support the lending process. In many markets, this meant the demand surpassed the number of available appraisers which contributed to extended turn times in the appraisal and closing process.

“Additionally, lockdowns due to COVID-19 prohibited appraisers from visiting the property and in some cases, either the appraiser was not willing to visit the property, or the homeowner did not want the appraiser inside the home,” King said. “As a result, we had to leverage other means to collect information about the property which, in turn, increased the adoption of desktop and hybrid appraisals.”

The company executive, in another article, mentioned some specific trends as to what excites him about what is coming in the appraisal space.

For openers, King stressed that it is exciting to think that the industry could be in a place where one can get a valuation completed in a day or two. Being in the industry over 20 years, he has seen turn times go from five days to as high as four weeks in certain markets when volume is high.

“Seeing the industry adopt technology that is being used successfully in certain markets is very exciting – especially as we, as an industry, are not always the fastest to adopt and embrace technology,” he told us. “Virtual inspection technology has improved so much that it can capture images, create interactive 360-degree walkthroughs, measure the home with accuracy, create a digital floorplan and identify characteristics and amenities without a human even seeing the images. To think that we could have someone walk through a home in 30 minutes, send that information to an appraiser and have a valuation completed in a day is very exciting.”

King also suggested that appraisal modernization could be realized as early as next year. He shared factors he considered in making that prediction.

He said the adoption by the GSEs for desktop appraisals has been seen, and he expects that adoption to rise over the next year. Hybrid appraisals have been in testing for years now and the technology to ensure accurate data and image collection of a property have really increased confidence for many decision makers, he said. King told us that the topic has picked up momentum around the industry in the last year and he expects hybrid appraisals to be coming into play in 2023.