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How to Become a Real Estate Appraiser in 5 Steps
A real estate appraiser is someone who estimates the market value of real estate. Specializing in either residential or commercial properties, a real estate appraiser is often called upon to estimate values prior to important property events such as a sale.
As with any specialized career, education is going to be your first step. Every state has its own rules and requirements for becoming a real estate appraiser, so make sure to do your research–or visit McKissock Learning to quickly see what’s needed in your state.
Here are the five steps to take to become a real estate appraiser.
Step 1: Get a Trainee License Through Coursework
The appraisal industry is regulated differently in each state but all states require you to start your career as a trainee appraiser before becoming a licensed residential appraiser. In order to become a trainee, you need to complete and pass specific coursework giving you a solid foundation to become a real estate appraiser.
You need to take a minimum amount of coursework in order to become an appraisal trainee. The Appraiser Qualifications Board (AQB) sets national minimum standards for the education of appraiser trainees. The following hours of coursework are the minimum required to become a trainee appraiser in every state.
- Basic appraisal principles: 30 hours
- Basic appraisal procedures: 30 hours
- Uniform Standards of Professional Appraisal Practice (USPAP): 15 hours
As of January 1, 2015, in addition to these standard hours of coursework, you are also be required to take a four-hour supervisory/trainee class for a total of 79 hours of appraisal education. This required class goes over the expectations and responsibilities of the trainee and mentor relationship, which we’ll cover in detail in step two. McKissocl Learning offers this course and all the required courses for most states that can be completed on your schedule. Click here to see a list of courses required by your state.
Some states require slightly more classroom time to get your trainee license. Here’s a quick breakdown of the requirements in these states:
- New York, California and West Virginia: 150 hours of coursework
- North Carolina, Tennessee, Kentucky and Georgia: 90 hours of coursework
- Colorado: 110 hours of coursework
- Florida:100 hours of coursework
You still need to take the four-hour supervisory/trainee class, in addition to the coursework listed above, for these states.
There are many places that offer the standard appraisal courses required for getting your trainee license, but they are not created equal. McKissock Learning has over 25 years of experience educating real estate professionals and offers in-depth information and learning that prepares soon-to-be appraisers to be the best in their field.
Step 2: Complete 1,000 Hours of Work Experience Under the Supervision of a Licensed Real Estate Appraiser
After receiving your trainee license, you can then work as a real estate appraiser under the strict mentorship of a licensed real property appraiser. In order to graduate to the next level and become a licensed real property appraiser, you need to complete approximately 1,000 hours of work experience under their supervision in no fewer than six months.
Trainee appraisers can usually find solid positions at residential appraisal firms and more frequently at banks, which generally have the greatest need for real estate appraisal services. Places like the American Society of Appraisers job bank or Indeed or can often be great resources once you reach this point.
Getting a position as a real estate appraisal trainee can be challenging. Certified residential appraiser Doug Haderie gave a great tip for those just starting out, “You go to the state board website and print out every appraiser within a 10-mile radius and just start calling them.” Haderie stated that he printed out about 40 pages of information but didn’t get to the bottom of the second page before he had a lead for a job that ended up becoming his beginning steps in real estate appraising.
How Much Money You’ll Make in Your First Year as an Appraiser Trainee
While your earning potential as an appraiser is only limited by how hard you’re willing to work, you won’t get rich working as a trainee. Typically, appraisal trainees should expect to make somewhere between $24,000 and $50,000 per year, depending on what region of the country they work in, previous work experience and skill set and their level of education. You can always look at the available trainee jobs at Indeed to get an idea of what the salaries currently are in your area.
Step 3: Complete Required Coursework
After finishing your 79 hours of appraisal education to become a trainee and completing approximately 1,000 hours of work experience under the supervision of a licensed real estate appraiser, the next step has changed dramatically as of May 1, 2018. We have reviewed the changing state criteria below.
Source: The Appraisal Foundation
It’s important to understand that state appraiser regulatory agencies are only required to adopt minimum AQB criteria, so be sure to contact your state’s agency specifically to confirm what elements they are incorporating from the May 2018 changes in policy, and when they will be going into effect.
The new requirements to become an appraiser don’t include college-level education but does provide a number of options to meet other criteria as seen below. Be sure to contact your state’s agency to see how they are adopting the new standards and what is required of you to complete them.
Source: The Appraisal Foundation
Step 4: Pass the Residential Real Property Appraiser Exam
The next step is to take and pass your state’s real property appraiser exam. You need to pass this test to become a fully licensed real estate appraiser. The exam covers appraisal math, legal considerations, real estate markets, types of value and more. To be able to sit for the exam, be sure to have completed your trainee requirements.
As a guide to learn more about the appraisal requirements in your state, be sure to click here to find your state and learn more.
Step 5: Submit Your License Application to Get Your Appraiser License
After completing your work experience, educational requirements and passing your exam, the final step to becoming a real estate appraiser is to submit your license application to your state’s real estate appraisers’ board. Once you have your license, you can begin working as a real estate appraiser with some limitations on what types of property you can appraise.
License Limitations for Residential Appraisers
As a licensed residential appraiser, you can only appraise noncomplex one- through four-unit residential properties worth less than $1 million and complex one- through four-unit residential properties worth less than $250,000. In order to appraise more complex properties or properties valued higher than $1 million, you need to take additional coursework to become a certified residential appraiser.
Optional: Become a Certified Residential Appraiser
After working as a licensed residential appraiser for a few years, you may want to upgrade your license to become a certified residential appraiser. The main benefit of becoming a certified residential appraiser is that you are allowed to appraise properties valued at more than $1 million. There are career benefits to upgrading your license as well.
In addition, you become much more marketable as an appraiser as many banks prefer to work with certified residential appraisers rather than licensed residential appraisers.
In order to become a certified residential appraiser, you need to have the following:
- A bachelor’s degree.
- At least 200 hours of AQB-approved appraisal coursework. Previous coursework to get your appraisal license counts toward this goal, so it is only additional coursework to be eligible for a certified appraiser license.
- At least 1,500 hours of experience working as an appraiser or appraisal trainee in no less than 12 months. The hours of work experience you completed as a trainee counts toward this total, you only need additional hours of work experience.
As a certified residential appraiser, you can appraise one- to four-unit residential buildings without regard for complexity or value. You may also appraise vacant or unimproved land that is utilized for one- to four-residential units or is best suited for one- to four-residential units. In order to appraise vacant or unimproved land suited for more than four residential units, you need to get additional certifications.
Optional: Join the National Association of REALTORS
Joining the National Association of REALTORS (NAR) makes sense as you begin your career as a real estate appraiser. In order to appraise real estate accurately, you more than likely need access to a multiple listing service (MLS) in order to research closed and current properties for sale. To access an MLS, you need to join NAR.
To join NAR, you need to register with your local association of REALTORS. Yearly dues vary from state to state but most charge between $150 and $250 per year. Depending on what firm you work for, this cost may be covered by your employer. If you’re working freelance, then you have to pay this expense on your own.
How Much Do Real Estate Appraisers Make?
According to data from the 2017 NAR Member Profile, the median income for all NAR-affiliated real estate appraisers in 2016 was $83,759. These are only real estate appraisers who are members of NAR and likely work within a real estate firm. According to the United States Bureau of Labor Statistics (BLS), the 2017 median pay was $54,010 per year.
Considering that the median income for NAR member real estate sales agents is only $33,750, real estate appraisal is a more lucrative career option. For example, only 12 percent of real estate agents make between $50,000 and $74,999. For real estate appraisers, that number is 17 percent. On the higher end, only 8 percent of real estate agents make between $100,000 and $149,999. For real estate appraisers, that number is 20 percent.
SOURCE: SOURCE: NEF2.COM