The Future of Property Appraisal
“The margin of error that appraisers are faced with on a regular basis is decreasing thanks to technology.”
What is an Appraisal District?
If you have ever purchased, sold, insured, or lent money for residential or commercial property, chances are you have crossed paths with your local appraisal district. Appraisal districts are responsible for valuing tens and even hundreds of thousands of properties each year, across several industry niches. Accuracy is crucial when it comes to property purchases, and yet, appraisers face the nearly impossible task of valuing every piece of real estate and business personal property on their own. While they try to push values as much as they can without causing too much upheaval from the public, some commercial property owners will still receive inaccurate and perhaps unfair valuations. Whether appraisers are truly specialists or if they are making an educated guess, they are required to be the expert on all types of property including commercial, residential and business personal property, therefore, providing wrong answers is usually met with a lot of grief from property owners and prospective buyers.
Beyond this inconsistency in valuation, staff members are facing even more challenges, as most newly-hired employees may not have real-world experience in valuations or acquisitions. As more knowledgeable appraisal veterans retire, they leave limited resources for staffing and HR departments to fill the void. It is for this reason that jurisdictions are starting to rely more heavily on IT, regardless of the budgets in place. What exactly is technology’s role in property appraisal, and how will it continue to shape the appraisal industry? Let’s take a look.
One example of a district embracing the IT side of appraising is Williamson Central Appraisal District (WCAD), located in Georgetown, Texas. WCAD prides itself on providing quality service with the highest standards of professionalism, integrity, and respect, while also giving an accurate, fair, and cost-effective appraisal roll in compliance with the laws of the State of Texas. WCAD provides documentation about the area, forms, and even video overviews to help smooth the daunting process of property appraisal and give locals a useful resource. As the appraisal industry continues to change, the automated side of WCAD becomes more crucial.
Network Administrator Michael Page is one employee working with technology that keeps the automated side of WCAD running. “I am responsible for the daily operations of our servers, storage, and networking equipment,” explains Page. The role of overseeing servers and software for appraisal is an important one, especially as automation continues to refine and optimize the appraisal business. “In the near future, we are planning on converting to VMware from Hyper-V,” Page states. “The VMware system we purchased from Trusted Tech Team will give us more options for disaster recovery and performance.” This expansion will be a huge benefit and will give the department more options for cloud computing and managing virtual machines.
The biggest question facing the appraising industry comes down to survival. Digital appraising can help reduce confirmation bias, weeding out the “educated guessers,” of the appraisal industry. The margin of error that appraisers are faced with on a regular basis is decreasing thanks to technology, with companies like Zillow working toward getting their Zestimate algorithm down to a 2% error rate. Computerized models improve accuracy overall, leaving professional appraisers in the dust. As the technology gets cheaper, a more algorithm-based system could be the future of appraising. For now, it seems appraisal districts will continue to face a decrease in professional appraisers coming into the job market and an influx of IT professionals who can oversee newer technologies. WCAD is just one of the many businesses working hard to transition into a technology-driven workforce, and it won’t be the last.