Fannie Mae and Freddie Mac are looking at doing away with formal appraisals on homes valued up to $400k. They say they’ll start using robots to do appraisals to save the clients money. The $100 estimated robotic appraisal will use drones and algorithms as compared to $400 for a traditional appraisal. Saving the client an average of $300.
I love technology, but it has it’s place and it’s not appraising homes.
In Florida, we are well known to have a manufactured home next to a mansion. What algorithm would they use? The mansion could have a sinkhole that swallowed the interior and the trailer could have chandeliers. What algorithm and drone robot can accurately evaluate the real world value?
Since the loan is a percentage of the appraisal, if this passes it would be foolish to spend money fixing things and making things really nice. Everyone should only use builder grade finishes and neglect maintenance. Otherwise we are just throwing money into the sinkhole!! Algorithm’s and drone’s won’t see the sacrifices you made to beautify and maintain your home.
A real appraisal is such a minimal expense compared to the purchase, averaging $400. They take into consideration the condition of the property, the layout and popularity of the style of the property as well as other very powerful elements. This stupid idea of robot appraisals could and will cause legitimate buyer’s to be declined and the seller’s to lose tens of thousands of dollars. Silicon valley pumps out some good stuff, but should stay out of this industry otherwise we’ll making housing another social justice victim.
Spend the $300 difference and get it right for all sides of the contract.
Buy, sell or rent anywhere in Tampa bay.
Curtis Rudolph Realtor®
Charles Rutenberg Realty