8/16/12

I want to preface this by saying that I'm not trying to be a dick to appraisers, so just correct me if I'm way off here because honestly this is just what I know from what limited sources I've heard from:

The vast majority of what I've seen and heard of CRE Appraisers is that it's a much different game than say someone who is doing valuation work for REPE acquisitions or even work at a brokerage. It seems that most people characterize the work as a formality that's not at all deeply analytical. It seems like more of a role as a monkey whose job it is to go grab the different required pieces to do a required appraisal, like just finding out what market cap rates are -- piecing together Costar comps data, etc. I've also seen a lot of people in appraisal work with very soft resumes.

Is this accurate? Is this only accurate for some and not others? Correct me if I'm wrong. I'm being very harsh to these guys perhaps, but this is just what the gist of what I've heard from people...

Comments (87)

8/18/12

My first year or so (I say "or so" because, well, it's an odd story) I worked in commercial appraisal. It was a very difficult job--every appraisal requires a ton--A TON--of research. Yeah, your 120-page appraisal template is already created so you're just modifying the information, but you're still talking about 120 Word Document pages of material. The amount of research is enormous. I had to make hours of phone calls for each appraisal, had to modify and manipulate, well, 120 pages of information--maps, graphs, spreadsheets, paragraphs, pictures, etc. You've got to be a very competent writer--you literally have to have college degree level writing abilities. If you're doing national work, on every appraisal you have to actively discover where to find tax rules, assessment rules, zoning information, economic information, etc. for each freaking locality.

The job paid $35,000 per year plus OT/bonus. I made about $42,000 for that year. I've never worked so hard for so little in my entire life. I HATED the job, but looking back it was amazing experience. If you're really passionate about hands on real estate (not the bullsh*t real estate of Wall Street where people manipulate securities, but legit ground level real estate) there is literally no better experience than spending 12 months learning about CRE zoning, taxes, revenue streams, source information, traditional financing, county governance, LEED standards, etc. that one learns as an analyst working with CRE appraisals. I would absolutely not choose it as a full-time career path, but for a new college grad who wants to actually learn more about real estate than how to value a mortgage-backed security then it's probably the single best experience one could get.

Now, you've got your big real estate firms that may work more like a production shop--spit out junk as fast as possible. Those are probably the guys you have been talking to. However, the group I worked with was a 100-person, 5-office national boutique that took its job deadly seriously. No garbage was being spit out. If we charged $5,000 for an appraisal then by God it was going to be quality.

I did find out later when I moved to Freddie Mac Multiamily's underwriting group that yes, appraisals are a formality and are essentially un-reviewed other than looking at page 1 with the value. It was extremely disheartening to learn how hard I worked was really for naught.

Financial Modeling
8/18/12

Vtech how long ago was it that you were making $35k/year? That seems absurdly low, maybe not for someone coming out of University of Southern New Mexico with a BA in Forestry, but VTech is at least a decent school.

8/18/12

Vtech how long ago was it that you were making $35k/year? That seems absurdly low, maybe not for someone coming out of University of Southern New Mexico with a BA in Forestry, but VTech is at least a decent school.

8/18/12

Fall of 2007 in the DC area as the real estate market began to collapse. There were almost no jobs in real estate available at the time. Plus I had no internships or work experience to speak of. Some of my peers were making $50k based on their prior experience.

8/18/12

By peers, did you mean other employees starting at your appraisal firm or your VTech friends with RE experience?

8/18/12
Penn7690:

By peers, did you mean other employees starting at your appraisal firm or your VTech friends with RE experience?

I should have said co-workers at the same level.

8/20/12

I also worked in commercial RE appraisal directly out of undergraduate and learned ALOT. There is an enormous amount of research that goes into this type of position, and you get exposure to numerous other related CRE professionals/fields (b/c you need to talk with everyone associated with the property - asset manager, property manager, owner, lender, tenants, owners of comparables, appraisal district, zoning, etc..).

I wouldn't recommend this position for the long term for 2 reasons:

  1. Fee structure - Its simple, right more reports and you'll make more $$$. I would imagine that writing reports for guys who are making more money than you would eventually get old.
  2. Fee splits with principal - low margins for work complete (compared to other industries).
8/20/12
REValuation:

I also worked in commercial RE appraisal directly out of undergraduate and learned ALOT. There is an enormous amount of research that goes into this type of position, and you get exposure to numerous other related CRE professionals/fields (b/c you need to talk with everyone associated with the property - asset manager, property manager, owner, lender, tenants, owners of comparables, appraisal district, zoning, etc..).

I wouldn't recommend this position for the long term for 2 reasons:

  1. Fee structure - Its simple, right more reports and you'll make more $$$. I would imagine that writing reports for guys who are making more money than you would eventually get old.
  2. Fee splits with principal - low margins for work complete (compared to other industries).

These are exactly my thoughts as well. Great experience, poor long-term career path except for a handful of owners.

9/16/12
Virginia Tech 4ever:
REValuation:

I also worked in commercial RE appraisal directly out of undergraduate and learned ALOT. There is an enormous amount of research that goes into this type of position, and you get exposure to numerous other related CRE professionals/fields (b/c you need to talk with everyone associated with the property - asset manager, property manager, owner, lender, tenants, owners of comparables, appraisal district, zoning, etc..).

I wouldn't recommend this position for the long term for 2 reasons:

  1. Fee structure - Its simple, right more reports and you'll make more $$$. I would imagine that writing reports for guys who are making more money than you would eventually get old.
  2. Fee splits with principal - low margins for work complete (compared to other industries).

These are exactly my thoughts as well. Great experience, poor long-term career path except for a handful of owners.

What were the fee structures in the groups you worked for? I work for a large national group and I feel like our structure isn't that bad. I think every certified general in our office who is at least somewhat competent is making 6 figures ($100k-$350k) with the directors doing very well.

My perception is that if you are smart, it is not that hard to make $175,000 a year without killing yourself working. Prior to this I was in fixed income, and while I understand that the upside there is lot higher, I feel like I have a much better lifestyle, a lot less stress, and a lot more stability in appraising.

9/16/12
tyrone45:
Virginia Tech 4ever:
REValuation:

I also worked in commercial RE appraisal directly out of undergraduate and learned ALOT. There is an enormous amount of research that goes into this type of position, and you get exposure to numerous other related CRE professionals/fields (b/c you need to talk with everyone associated with the property - asset manager, property manager, owner, lender, tenants, owners of comparables, appraisal district, zoning, etc..).

I wouldn't recommend this position for the long term for 2 reasons:

  1. Fee structure - Its simple, right more reports and you'll make more $$$. I would imagine that writing reports for guys who are making more money than you would eventually get old.
  2. Fee splits with principal - low margins for work complete (compared to other industries).

These are exactly my thoughts as well. Great experience, poor long-term career path except for a handful of owners.

What were the fee structures in the groups you worked for? I work for a large national group and I feel like our structure isn't that bad. I think every certified general in our office who is at least somewhat competent is making 6 figures ($100k-$350k) with the directors doing very well.

My perception is that if you are smart, it is not that hard to make $175,000 a year without killing yourself working. Prior to this I was in fixed income, and while I understand that the upside there is lot higher, I feel like I have a much better lifestyle, a lot less stress, and a lot more stability in appraising.

Never heard of a commercial appraiser who isn't an owner making anywhere near $200,000/year. Most appraisals come in around $5,000 and each takes about 30 days to deliver and takes something like 30-40 man hours of work. If all you did was appraisals and you did nothing to sell your services and you paid no rent and had no expenses then I could see income of around $300,000. But that's really not that realistic unless you work from home and have 10-20 years of prior relationships that send you business with minimal time spent on staying in front of clients, training, continuing education, etc.

Basically, there are a strong number of certified general appraisers--to make really good money you are basically a salesman and then you hire and train people below you to do the work. I don't mathematically see how you could make excellent money with less than 15 years of experience.

  • Anonymous Monkey
  • 12/2/15

I think some of you are misinformed about this industry. I am a commercial appraiser trainee in NYC. I am about to to be put into fee split and am working to get a Certified General License within the next few months. My co-worker makes 250-300K a year. He is a Certified General Appraiser. There are so many factors in terms of how much you make its difficult to tell how much you could earn. I work in a small firm and we have very outdated technology so it affects our efficiency obviously. Most of the larger firms(CBRE, Cushman, Etc) have proprietary report writing software that increases efficiency exponentially. I was working in Florida previously for one of the big real estate companies with this technology and saw many Certified General Appraisers producing 700-900K in fees on a 50% fee split(making 350k-450K). The beauty of it is I will make at least 200K next year in NYC and I have only been working in this job for about two years. What industry can you start in where you start at $50-60K and then jump to at least $150K within two years? Not many! I do work hard however usually putting in at least 60 hours a week not including educational requirements. There are many opportunities if you stick with it for a few years. If you get the MAI designation you can charge $300-500 an hour to be an expert witness. If you get a Certified General License(one step below an MAI designation) you can take on up to three trainees who essentially write all the reports for you and just add to your total billings. You can go out on your own obviously too and this work requires very little overhead. I would suggest if you want to get into this industry you get yourself up to date on all technology especially all programs in Microsoft Office.

12/6/15
undefined:

I think some of you are misinformed about this industry. I am a commercial appraiser trainee in NYC. I am about to to be put into fee split and am working to get a Certified General License within the next few months. My co-worker makes 250-300K a year. He is a Certified General Appraiser. There are so many factors in terms of how much you make its difficult to tell how much you could earn. I work in a small firm and we have very outdated technology so it affects our efficiency obviously. Most of the larger firms(CBRE, Cushman, Etc) have proprietary report writing software that increases efficiency exponentially. I was working in Florida previously for one of the big real estate companies with this technology and saw many Certified General Appraisers producing 700-900K in fees on a 50% fee split(making 350k-450K). The beauty of it is I will make at least 200K next year in NYC and I have only been working in this job for about two years. What industry can you start in where you start at $50-60K and then jump to at least $150K within two years? Not many! I do work hard however usually putting in at least 60 hours a week not including educational requirements. There are many opportunities if you stick with it for a few years. If you get the MAI designation you can charge $300-500 an hour to be an expert witness. If you get a Certified General License(one step below an MAI designation) you can take on up to three trainees who essentially write all the reports for you and just add to your total billings. You can go out on your own obviously too and this work requires very little overhead. I would suggest if you want to get into this industry you get yourself up to date on all technology especially all programs in Microsoft Office.

Come back to us when you're making $200,000 with 3 years of experience. We'll be waiting with bated breath.

9/16/12
tyrone45:
Virginia Tech 4ever:
REValuation:

I also worked in commercial RE appraisal directly out of undergraduate and learned ALOT. There is an enormous amount of research that goes into this type of position, and you get exposure to numerous other related CRE professionals/fields (b/c you need to talk with everyone associated with the property - asset manager, property manager, owner, lender, tenants, owners of comparables, appraisal district, zoning, etc..).

I wouldn't recommend this position for the long term for 2 reasons:

  1. Fee structure - Its simple, right more reports and you'll make more $$$. I would imagine that writing reports for guys who are making more money than you would eventually get old.
  2. Fee splits with principal - low margins for work complete (compared to other industries).

These are exactly my thoughts as well. Great experience, poor long-term career path except for a handful of owners.

What were the fee structures in the groups you worked for? I work for a large national group and I feel like our structure isn't that bad. I think every certified general in our office who is at least somewhat competent is making 6 figures ($100k-$350k) with the directors doing very well.

My perception is that if you are smart, it is not that hard to make $175,000 a year without killing yourself working. Prior to this I was in fixed income, and while I understand that the upside there is lot higher, I feel like I have a much better lifestyle, a lot less stress, and a lot more stability in appraising.

I have to admit this post doesn't make a whole lot of sense to me either.

  • Anonymous Monkey
  • 1/27/16

I am in the DC market and I make about 150k per year. I have colleagues that make 200-250k as appraisers, not directors. Much of this thread seems inaccurate to me in terms of the low pay scale.

1/27/16
undefined:

I am in the DC market and I make about 150k per year. I have colleagues that make 200-250k as appraisers, not directors. Much of this thread seems inaccurate to me in terms of the low pay scale.

I think you're totally full of sh*t. My boss--a full MAI who was REALLY, REALLY good at what he did--when I was an appraiser analyst is now working as an underwriter at a multifamily finance company. I think you're totally full of garbage.

9/7/12

So guys, what are the exit ops for us 1-2 year analysts in CRE appraising jobs?

4/7/17

I jumped to a credit analyst for a lender after a year working in mostly portfolio valuation.

9/7/12

Well....out of this job I would say it's mostly luck or happenstance where you end up.

If there are, say, 10 analysts doing this work 8 of them will exit this industry within 30 months. So the obvious answer is that 20% are staying and making a career of it. Just based on what I've seen among my former co-workers in the Mid-Atlantic (for the next job immediatley following the analyst stint)--one (me) moved to multifamily underwriting at Freddie Mac; one took a government research role with the Navy; one joined a government consulting firm with a generic job; one left and joined a real estate research company; one got a job at the nuclear regulatory commission; and 1 fell off the map completely.

The fact is, off all my co-workers, 3 of us have made out pretty well as a direct result of the job--the 1 girl (super hot actually...) stayed with the group and has done well for herself (she's a certified general appraiser with her own clients) and I exited into an elite group at a GSE (I had the right experience at the right time in the rare instance a job with this group opened up). The other guy is associate level at the real estate research company, although I'm not sure he makes that much money. Everyone else got another job somewhere else mostly in spite of what they did in commercial appraisal (or it was spun well on their resumes).

9/9/12

The doors pretty wide open assuming you want to continue in cre at the asset level. It depends what your goals and interests are- you could consider being a financial analyst for an asset manager or developer, move into commercial lending, or obviously brokerage. I knew a guy who moved into business valuation advisory role for a Big 4, but I think valuing personal property would get old real fast.

Moving into the "capital markets" group at a brokerage house isn't to farfetched, you should build up your network b/c the contacts you get in the appraisal business will def help you in the future.

9/16/12

Hey guys, I read back what I wrote, and in my haste did a terrible job explaining myself. The bulk of that range is in the $100,000-$140,000 range, I don't mean to imply that making over $150,000 or $175,000 was fast or easy. Either one would be a tall order without an MAI. With regards to making over $200,000, the only ways I see making that are by having an MAI and busting your ass, having two very competent trainees under you doing well while you are busting ass, or being the complete outlier who works IB hours and has a niche that provides a steady stream of work with high fees. My apologies for implying otherwise.

9/16/12
tyrone45:

Hey guys, I read back what I wrote, and in my haste did a terrible job explaining myself. The bulk of that range is in the $100,000-$140,000 range, I don't mean to imply that making over $150,000 or $175,000 was fast or easy. Either one would be a tall order without an MAI. With regards to making over $200,000, the only ways I see making that are by having an MAI and busting your ass, having two very competent trainees under you doing well while you are busting ass, or being the complete outlier who works IB hours and has a niche that provides a steady stream of work with high fees. My apologies for implying otherwise.

That makes more sense to me. I talked to the guys at CBRE in my city, who seem to be one of the top appraisal groups around here, and it sounds like the real breadwinning takes place at a very senior level, where just a couple or handful of guys have relationships with - for example - the special servicers, and the assignments all trickle down from there to the dozens of appraisers who have more work than they can handle coming down from LNR, etc.

4/11/13

Everyone at cbre and cushman makes over $120k doing appraisals. The best apprasier in the country is at cbre and does $750k. I know this because his boss told me. If you're at a small shop you'll only make 50k.

4/11/13

ssevans3:
Everyone at cbre and cushman makes over $120k doing appraisals. The best apprasier in the country is at cbre and does $750k. I know this because his boss told me. If you're at a small shop you'll only make 50k.

Quality gravedig, hah.

You can definitely make some money doing appraisals for CBRE. Problem is, not everyone works at CBRE, and even if you do, to answer the OP's point, yes being an appraiser would suck haha. Awful job

4/18/13

ssevans3:
Everyone at cbre and cushman makes over $120k doing appraisals. The best apprasier in the country is at cbre and does $750k. I know this because his boss told me. If you're at a small shop you'll only make 50k.

Everyone that I've talked to says that you won't make 6 figures unless you are bringing in business to the company. Once you do bring in business based on your relationships, etc, you can make a lot. In other words, it sounds like the jobs doing the actual appraisals never pay well. Are you saying that is false?

4/23/13

econcomputingCRE:
ssevans3:
Everyone at cbre and cushman makes over $120k doing appraisals. The best apprasier in the country is at cbre and does $750k. I know this because his boss told me. If you're at a small shop you'll only make 50k.

Everyone that I've talked to says that you won't make 6 figures unless you are bringing in business to the company. Once you do bring in business based on your relationships, etc, you can make a lot. In other words, it sounds like the jobs doing the actual appraisals never pay well. Are you saying that is false?

I work in CRE Appraisal for a smaller 10 man shop and really enjoy it. All the certified general appraisers on our staff make anywhere in the $125-$225k range depending on how much work and how many hours you are willing to take on. Most of our guys are only 2-5 years out of school. On average most of the guys work +/-60-70 hours a week. Our one MAI other than the firm owner if I had to guess is in the $350k range.

4/25/13

crewsn:

Everyone that I've talked to says that you won't make 6 figures unless you are bringing in business to the company. Once you do bring in business based on your relationships, etc, you can make a lot. In other words, it sounds like the jobs doing the actual appraisals never pay well. Are you saying that is false?

I work in CRE Appraisal for a smaller 10 man shop and really enjoy it. All the certified general appraisers on our staff make anywhere in the $125-$225k range depending on how much work and how many hours you are willing to take on. Most of our guys are only 2-5 years out of school. On average most of the guys work +/-60-70 hours a week. Our one MAI other than the firm owner if I had to guess is in the $350k range.[/quote]

I don't get it. I've heard people say they've worked for in appraisals making 35K a year, others say they break 200K (still as a dude just doing the appraisals -- not even someone bringing in business?). Maybe I need to think about getting into this line of work.

4/26/13

econcomputingCRE:

crewsn:

Everyone that I've talked to says that you won't make 6 figures unless you are bringing in business to the company. Once you do bring in business based on your relationships, etc, you can make a lot. In other words, it sounds like the jobs doing the actual appraisals never pay well. Are you saying that is false?

I work in CRE Appraisal for a smaller 10 man shop and really enjoy it. All the certified general appraisers on our staff make anywhere in the $125-$225k range depending on how much work and how many hours you are willing to take on. Most of our guys are only 2-5 years out of school. On average most of the guys work +/-60-70 hours a week. Our one MAI other than the firm owner if I had to guess is in the $350k range.

I don't get it. I've heard people say they've worked for in appraisals making 35K a year, others say they break 200K (still as a dude just doing the appraisals -- not even someone bringing in business?). Maybe I need to think about getting into this line of work.

[/quote]

Different firms structure the compensation for their appraisers differently, generally the ones on fee splits do significantly better than those on salary who do similar amounts of work but only get paid say $50K. Also keep in mind that appraisal is a very niche industry which is dominated by seasoned veterans who for the most part are not very "progressive". A recent report came out showing that over 55% of appraisers are over the age of 65. They have been doing appraisals the same way for the past 25+ years and are reluctant to change. The oldest person at my firm is the owner who is only 34. We embrace technology to increase efficiency unlike many "older" firms. I am not lying when I say that we can complete an appraisal in 1/3 or less of the time it takes some of our competitors.

If you want to get into appraisal I would recommended trying to get a job with one of the national firms like CBRE, Cushman, Integra, etc. or find a younger, more progressive firm. Otherwise you may very well end up working your tail off without the appropriate compensation. It is definitely a tough industry to break into.

4/26/13

crewsn:

econcomputingCRE:
crewsn:

Everyone that I've talked to says that you won't make 6 figures unless you are bringing in business to the company. Once you do bring in business based on your relationships, etc, you can make a lot. In other words, it sounds like the jobs doing the actual appraisals never pay well. Are you saying that is false?

I work in CRE Appraisal for a smaller 10 man shop and really enjoy it. All the certified general appraisers on our staff make anywhere in the $125-$225k range depending on how much work and how many hours you are willing to take on. Most of our guys are only 2-5 years out of school. On average most of the guys work +/-60-70 hours a week. Our one MAI other than the firm owner if I had to guess is in the $350k range.

I don't get it. I've heard people say they've worked for in appraisals making 35K a year, others say they break 200K (still as a dude just doing the appraisals -- not even someone bringing in business?). Maybe I need to think about getting into this line of work.

Different firms structure the compensation for their appraisers differently, generally the ones on fee splits do significantly better than those on salary who do similar amounts of work but only get paid say $50K. Also keep in mind that appraisal is a very niche industry which is dominated by seasoned veterans who for the most part are not very "progressive". A recent report came out showing that over 55% of appraisers are over the age of 65. They have been doing appraisals the same way for the past 25+ years and are reluctant to change. The oldest person at my firm is the owner who is only 34. We embrace technology to increase efficiency unlike many "older" firms. I am not lying when I say that we can complete an appraisal in 1/3 or less of the time it takes some of our competitors.

If you want to get into appraisal I would recommended trying to get a job with one of the national firms like CBRE, Cushman, Integra, etc. or find a younger, more progressive firm. Otherwise you may very well end up working your tail off without the appropriate compensation. It is definitely a tough industry to break into.

[/quote]

****55% over 55 years old, sorry for the typo******

4/26/13

crewsn:

If you want to get into appraisal I would recommended trying to get a job with one of the national firms like CBRE, Cushman, Integra, etc. or find a younger, more progressive firm. Otherwise you may very well end up working your tail off without the appropriate compensation. It is definitely a tough industry to break into

I work sort of on the fence between the technical and business side, and a lot of the stuff I've worked on is mostly used by appraisers. I just find it amazing that people can make so much money just writing appraisals.

What software do you guys use to cut down on time so much?

4/26/13

econcomputingCRE:

crewsn:

If you want to get into appraisal I would recommended trying to get a job with one of the national firms like CBRE, Cushman, Integra, etc. or find a younger, more progressive firm. Otherwise you may very well end up working your tail off without the appropriate compensation. It is definitely a tough industry to break into

I work sort of on the fence between the technical and business side, and a lot of the stuff I've worked on is mostly used by appraisers. I just find it amazing that people can make so much money just writing appraisals.

What software do you guys use to cut down on time so much?

We had developers build us a custom software which we initially start working on and then it exports to Word where we do the rest. Because of the differentiation required from appraisal to appraisal you cant really make a "perfect" software. We definitely have a lot of boilerplate text but have also cut out quite a number of things from our reports that are unnecessary and our clients could care less about; while still conforming to USPAP and FIRREA.

A common misconception about appraisers is how long the appraisals actually take to complete. Our typical "turn time" is anywhere from 2-4 weeks but that isn't because it takes that long to complete, its because we are booked up far in advance. For example if I was working on a pretty straightforward mid-rise office building, we would most likely do an Income Approach (Both Direct Cap & DCF - using Argus) and a Sales Approach. The inspection doesnt take very long at all, just a walkthrough checking all the common areas and inside a few different suites. Then back at the office the analysis and report writing may take +/- 8-10 hours (not necessarily all the same day as we often have to wait to receive some of the data we need). Our fee for that type of project would be around $4500. Typical appraiser fee split is anywhere from 30-40%. Comes out to about $150-$200/Hour.

There are definitely plenty of appraisal firms out there who would charge the same fee for that project but it may take them 30-40 hours to write the appraisal. While that may have been a typical time to complete the appraisal 15+ years ago, many of them haven't changed their ways and still use inefficient programs like Word 2000, Word Perfect, and even some use typewriters still (I'm dead serious haha). So those are the type of firms you hear about that are paying people $50k and less, since it takes them so much longer. It blows my mind how behind the times many local appraisal firms are.

4/9/14

crewsn:

econcomputingCRE:
crewsn:

Everyone that I've talked to says that you won't make 6 figures unless you are bringing in business to the company. Once you do bring in business based on your relationships, etc, you can make a lot. In other words, it sounds like the jobs doing the actual appraisals never pay well. Are you saying that is false?

I work in CRE Appraisal for a smaller 10 man shop and really enjoy it. All the certified general appraisers on our staff make anywhere in the $125-$225k range depending on how much work and how many hours you are willing to take on. Most of our guys are only 2-5 years out of school. On average most of the guys work +/-60-70 hours a week. Our one MAI other than the firm owner if I had to guess is in the $350k range.

I don't get it. I've heard people say they've worked for in appraisals making 35K a year, others say they break 200K (still as a dude just doing the appraisals -- not even someone bringing in business?). Maybe I need to think about getting into this line of work.

Different firms structure the compensation for their appraisers differently, generally the ones on fee splits do significantly better than those on salary who do similar amounts of work but only get paid say $50K. Also keep in mind that appraisal is a very niche industry which is dominated by seasoned veterans who for the most part are not very "progressive". A recent report came out showing that over 55% of appraisers are over the age of 65. They have been doing appraisals the same way for the past 25+ years and are reluctant to change. The oldest person at my firm is the owner who is only 34. We embrace technology to increase efficiency unlike many "older" firms. I am not lying when I say that we can complete an appraisal in 1/3 or less of the time it takes some of our competitors.

If you want to get into appraisal I would recommended trying to get a job with one of the national firms like CBRE, Cushman, Integra, etc. or find a younger, more progressive firm. Otherwise you may very well end up working your tail off without the appropriate compensation. It is definitely a tough industry to break into.

[/quote]

What market are you in? I'm in a shop with both partners being over 65 years old. They are planning to retire soon and I'm either going to buy 50% of the company or leave to find another group. I'm a fairly new appraiser and I've created a few ways to increase productivity with technology but have gotten a lot of resistance from the owners. I'd love to talk with you to get some details of the systems you use.

Financial Modeling
4/18/13

I'm a CRE appraisal analyst in Philadelphia and started of making $30K this year. This definitely seems under market however I just obtained my appraisal trainee license so I am bound to go up. CRE appraisals are definitely grunt work, especially starting off. I spend most of my time front loading reports, researching and confirming sales comps/leases, market statistics/research, and some income analysis given the assignment. There are times when I go out on an inspection which is nice to get out of the office every now and then. It seems that the trainees/analysts in this role do not receive appropriate compensation, but like with every job, you have to pay your dues. Within 3-4 years I will be state licensed/MAI and will be able to make a decent income. I have not decided if I want to make a career out of this as it is very depressing at times, however I do believe my skills that I have earned and will be accustomed to will be transferable to other roles within investments or development.

4/27/13

It just depends on your split, but your not going to have a great salary until you get licensed. This is probably the easiest way to get solid work experience in 1-2 years and the options after working in appraisal are very wide and you could lateral into a number of MUCH higher paying areas.

IE. development, brokerage, business/securities valuation (assuming you studied finance), REIT analyst jobs, banking credit positions, corporate real estate or "facilities" groups. You probably have no chance at getting into REPE or REIB unless you go get a top tier MBA/ MSF / MSRE, but you could probably get a job at a REIT if your sharp, and then lateral after that.

4/27/13

I have seen people do the appraisal to REIB jump twice at smaller banks.

Real estate can be so niche it is ridiculous. Being an expert at Argus and DCF valuations in Excel will allow you to have a good pick of jobs.

5/15/13

I've been talking to a firm interested in hiring trainees. They only start them off at a 25% split with estimated earnings around $35k max for the first year and possibly earning around $60k by the time one completes their general cert. 3 years later. I haven't heard anything about making over six figures from the firm.

5/15/13

mp:

I've been talking to a firm interested in hiring trainees. They only start them off at a 25% split with estimated earnings around $35k max for the first year and possibly earning around $60k by the time one completes their general cert. 3 years later. I haven't heard anything about making over six figures from the firm.

It doesnt take 3 years to complete general certification. You probably haven't "heard anything" because salary is normally not a casual lunch topic, its normally quite private.

5/15/13

mp:

I've been talking to a firm interested in hiring trainees. They only start them off at a 25% split with estimated earnings around $35k max for the first year and possibly earning around $60k by the time one completes their general cert. 3 years later. I haven't heard anything about making over six figures from the firm.

Most appraisers will not make over $100,000 per year. It's very much dependent on where you work, in terms of company and market.

5/17/13

With that being said, is it even worthwhile to get into the biz as a trainee and work towards being a Certified General Appraiser and eventually MAI? What are the variables that are going to negatively impact Commercial Appraisers' employment and salary growth in the future?

5/19/13

Salary growth depends on how much work you can get done and your fee split. Where I work my fee split is 30% and will move up to 35 and to 40 once I get my state and then MAI respectively. I believe once you are working in the career for a while you will get jobs with a higher paying total fee, as they are more complex and warrant a higher fee. Also once you get to the point where you can serve as a litigation expert you will also make more money. Other than that the real estate market will impact how many jobs are coming in. Appraisal is somewhat market neutral regardless of it being a buyer or seller market, but if there is just a total decrease in activity transactions there will be less work. Depending on the credibility of your firm there will be other aspects of the appraisal field that they will be involved in such as tax appeal and estate planning.

12/4/13

A lot of what has been said here is accurate, but I feel like I can add some things. Thought I could contribute here and help some of you considering a career in commercial appraisal work. I graduated with a degree in business and decided to give this a shot coming out of school. You really do have to pay your dues in this field to start making money. I began as a researcher earning $30k/year, which lasted for about one year. As others have said, this includes market research, setting up reports (taxes, zoning, etc.), working up comparable data, etc. This helps you get a feel for the basics and is really the only way to learn. After about a year, I began to produce reports, which were reviewed by an MAI designated partner, who also teaches you how to go about more difficult assignments as you gain experience. Four years later, I am just getting state certified and should be taking the MAI comprehensive this summer. I do not bring in work to the firm, it is handed down from the partner I work under in a small firm (10 people). I work in a top 50 size metro market and make about $110k/year, which is typical for everyone doing commercial work at my level here. I work about a 55 hour work week by the way. Generally, your income will increase when you obtain your MAI but the only way to significantly increase your potential earnings is by hiring trainees/researchers to work under you and help you to put out a higher volume of reports. I can't be certain, but I think my boss makes in the $350k range with three people under him. For all of the naysayers here, it is a fact that the median age of appraisers is in the 55-60 range and the bulk are nearing retirement. In this poor job market, there are opportunities to make money here but breaking into the business isn't easy. I really enjoy the work as I am within a market that I know well and I know that I am producing a high quality product. Hope this helps some of you.

Best Response
12/4/13

People absolutely can make good money in appraisal, but it really narrows at the top--the guys making $350,000 are the ones who have all the contacts. They are fundamentally salesmen--they are extroverted (typically), very experienced and very well connected. You don't make top dollar by actually doing the work.

I had a very brief stint in appraisal, and what I found was that to make good money in the model it requires "sweatshop" type arrangements and managing enormous turnover. The guys at the bottom of the ladder are basically the lowest wrung sweatshop employees--they work their asses off for very little pay. It's all about production, production, production--the firm's income is based on how much work can be spit out in the shortest amount of time, so employees are constantly measured on their production.

Most of these sweatshop employees leave within the first 2 years and the owner/managers' job is to constantly hire and re-hire these positions. The people who remain climb the ladder up into the low-to-mid 6 figure range, but they also continue to work in sweatshop type conditions, working 55-60 hours/week, with production being the absolute and most critical thing. I remember entire workdays where the office was nearly dead silent the entire day as people worked feverishly to spit out more and more work. There simply was not time to chat with a co-worker or to go to lunch with a friend.

Unless you can break into the "upper classes" of appraisal where you are the one bringing in business, the rest of your career will be a constant rush of spitting out work. Even my manager--who was making probably $100,000 with a solid 8 years of experience and 3 employees doing his grunt work--was constantly pushing and reading and pushing and inspecting. I found early on that the career was 30-40 years of constant stress unless I became a salesman.

12/4/13

DC, I agree with the majority of your post. That said, although the "salesman" aspect comes into play when you're running a firm, it isn't that big of a factor in my market. It does take a certain amount of drive to get to a partner or "salesman" position but with the dwindling amount of competition (median age of appraisers is around 57), particularly in my market, the door is wide open and the demand is there. If you create a quality product in a mid-size market, the clients find you. There's a lot less to the "salesman" aspect here than maybe where you are. In addition to being a "salesman", you have to collaborate with your employees/teach them with regard to how to approach and complete certain complex jobs as well as doing a ton of review work before reports can go out to clients. It's basically appraisal management with some marketing skill required (it pays to be an extrovert but is definitely not required). I'll take it over a mid-level corporate management job anyday, but that's just me.

My first firm was a "sweatshop" with an emphasis on speed over quality, similar to what your experience was like. I have since left that firm and work for another that treats me fairly (higher than average take/job) and has the emphasis on doing appraisals the right way. If you put out quality work and don't cut corners, you get rewarded. Though many firms employ the "sweatshop" approach, not all of them do. Training appraisers as they progress to eventually become partners is another approach, with less turnover, that pays for both parties and the firm as a whole. Again, put out quality work and the clients will find you. You have to go into an appraisal career with the ambition of being the guy in charge or its not worth doing IMO

12/4/13

Some slaverholders treated their slaves better than others. At the end of the day, the way the guy at the top makes the most money is having underpaid, over worked slaves at the bottom. Since it isn't true slavery, the guy at the top spends a great deal of his time managing turnover.

It's nice that you have found a nice niche at a company that treats you well. For the vast majority of people it's a horrible career.

And to add, at my bank, the moment an appraiser "screws up"--gives us a questionable value--is the moment he/she is dropped like a bad habit. And the second business dries up is the second the business model collapses, hence why the industry nearly collapsed between 2008-2010 during the financial collapse.

12/4/13

A 55 hour workweek to make $110k/year is far from slavery. Horrible analogy. I'm sorry your experience was so poor but I assure you there are several twenty-somethings who would take on a 55 hour workweek for that pay in this crappy job market, particularly with the prospect of being your own boss and making upwards of $300k by the time you're in your thirties.

12/4/13

From 2008-2010 the work was steady due to the huge amount of foreclosures. Good appraisers will find work when times are tough, sweatshops producing garbage will collapse.

12/4/13

Again, you've found yourself a nice little niche thanks to your boss and his connections. Your experience is not demonstrative of the vast majority of appraisers and trainees. The firm I worked at laid nearly everyone off in 2008-2010. You're basically peddling here the best case scenario for people. It's a pretty unfair commentary. I work with appraisers every single solitary day--your experience is in the top 10% of experiences. There's a reason the average age of an appraiser is approaching 60 (your assertion, not mine)--because people think the career sucks.

12/4/13

The Appraisal Institute put out the age figure earlier this year along with a write up about how will be a national shortage of appraisers in the future. I agree, many do have to deal with "sweatshop" conditions, as I did starting out. Like many jobs, you have to pay your dues and keep an eye on what you're capable of earning and the fact that you can be the boss and run your own company in the future. My posts are intended to show the other side of the negativity talked about here and are speaking of my experience only; they are not intended to show how the industry operates as a whole, rather, they are intended to show that there ARE other non-sweatshop firms out there and there are opportunities.

12/5/13

I have to echo DCD, while there might be a small number of appraisers who have scaled their business to earn good money, it's rare. Valuation is a good place to learn and leverage into another job but I wouldn't recommend for someone looking to get rich in real estate.

Fill the unforgiving minute with 60 seconds of run. - Kipling

12/5/13

Haha, its certainly not any way to "get rich in real estate". I never meant to imply that. I would classify it as a "good career" if you're able to excel in a given market, build relationships with a steady clientele, and build your own business/hire employees, but definitely not going to get you rich. You're right though, only a small few are able to do it. As this is a Wall Street board, I'm beginning to realize I may be speaking to the wrong audience. Commercial valuation is a career that doesn't require an advanced degree, which I'm sure most readers/posters who aspire to be working on Wall Street do. My comments were aimed for those with a BS in finance (or similar) looking for career advice - I just wanted to add my two cents to all of the negativity on this board. The demand remains high for quality work and there is money to be made by investing your earnings in your market using knowledge you've gained by working in the field

12/5/13

And OP, if the title is "Commercial Real Estate Appraising Sucks", it doesn't really matter what you preface in your first sentence. Haha you just slapped all of them in the face and follow it up with "but I don't want you take that slap personally".

Fill the unforgiving minute with 60 seconds of run. - Kipling

12/9/13

Figured I'd share my experience for more recent grads seeing how a couple of the posts relate to entry-level experience from a few years ago. As just about everyone else has mentioned, you definitely have to pay your dues when you first start out in commercial appraisals. It's not a post-college job for those looking for instant salary gratification, but for those willing to wait - even just a year, in my particular case - the upside can be compelling. Sure, you'll never make as much money as REIB or REPE, but quality of life IMO is far superior and if you play your cards right, you can be making relatively good money within 2-3 years.

I'm at a smaller but well-regarded firm covering NYC and Long Island. Fees are typically $3,000 to $7,500; anything $5k and up is generally fairly complex or has an extensive scope (proposed renovations/conversions, rent-regulation, etc.). Our Certified General's are in the $125-$160k range, with our MAI president/owner at about $400k. (Should note that he's been doing it for 30+ years in the same market and has an enormous client/contact list, which undoubtedly helps get us the amount of business we do)

I came into this in having a couple of RE internships and a heavily RE-focused degree from a highly regarded school. Had ARGUS and various valuation experience from my coursework as well. This helped me bargain a little in terms of starting salary, but still was only at $35k to start. Pretty much began as a supporting analyst of sorts; I would assist in various aspects of the appraisals, i.e. verifying comps, getting all the basic property info (zoning, taxes, etc), direct caps, so forth and so on. It sucked at the time, but, as mentioned throughout this thread, it really does give you invaluable experience at the individual asset level due to the sheer amount of research it takes.

After about 6 months of busting my ass, I was able to do reports on my own and renegotiate some in terms of compensation, up to about $55k. The way I would describe the learning curve is this: the first six months, you're just getting the general lay-of-the-land. This is when you find where to get your data, what data sources work well for what, which brokers to call, how to most effectively structure your reports, and how to approach various types of appraisal problems. The second 6 months is more of a refinement period: you learn how to approach more complex situations and how to more effectively manage the time you spend on each report. In my personal experience, I progressed by far the most during this period and it gave me a good skill set for going forward. My ARGUS certainly got better after a couple of large Class B office buildings in Midtown Manhattan.

By the end of my first year, I was doing $15-18k a month in fees billed, which allowed me to again renegotiate my compensation once more. Ended up getting salary/split equivalent to just over 40% and on track to do $210-220k in billings this year. Also get a 5% (of total compensation) profit-sharing 401k bonus. AS A DISCLAIMER: this is probably not typical for start of 2nd year, especially outside of the largest US metro markets. That being said, if you can get into a progressive firm that is willing to let its talent learn and thrive, you can certainly make good money, learn a ton about individual asset-level CRE, and limit your weekly work exposure to 55-65 hours.

TL,DR: You'll absolutely have to pay your dues starting out in commercial appraisal, but if you want invaluable experience at the individual-asset level, it is a great way to go. Money won't be great starting out, but with hard work and a drive to improve your valuation skills, you can be making six figures+ within 2-3 years in a larger market with good quality of life benefits (less stress/hours). Skills are transferable to a good range of CRE niches, because at the end of the day it all boils down to "how much money is this asset going to make us, and what is a good price to buy/sell it for," which are all rooted in valuation. Wholeheartedly agree that it is not the best long-term option for most people who would be reading WSO in the first place, but it provides a solid foundation.

2/13/14

Thank you to all who posted this. Very informative.

Wise Men Listen & Laugh While Fools Talk

2/20/14

Hello guys. This is a great post thank you for the info. I am looking to get my Certified General Appraisal license. From what I have read, I need about 2-3 years of trainee experience in the field upon completing the courses. From your experience, how hard is it to get the trainee job? I would hate to complete all these courses and have a difficult time getting a relevant working experience. Please advise!

2/21/14

money.monkey:

Hello guys. This is a great post thank you for the info. I am looking to get my Certified General Appraisal license. From what I have read, I need about 2-3 years of trainee experience in the field upon completing the courses. From your experience, how hard is it to get the trainee job? I would hate to complete all these courses and have a difficult time getting a relevant working experience. Please advise!

It can be very difficult because generally people do not like to train their future competition. There aren't a lot of MAIs who are willing to supervise juniors. However, the roles are out there--you can go to indeed.com and find organizations advertising for just these types of people.

3/1/14

Just got an internship at small CRE appraisal/brokerage company in the suburbs of Boston. There's less than 10 people there and im working directly under the owner. He said ill go to meetings with him and check out potential properties and what not. It seems as if I meet the right people ill be able to leverage it into something better in the city after graduation. The end goal would be something along the lines of REIT or REPE, but that's a ways away.

4/10/14

What is the general career progression for those in CRE appraisal?

4/16/14

realster:

What is the general career progression for those in CRE appraisal?

Research/Intern -> Appraiser Trainee -> Certified General -> MAI

7/11/14

Do you guys have any idea how much MAIs make? I'm considering this career, but I'm not sure about how much industry compensation for someone with 10+ years of experience is.

8/31/15

Overall, appraising real estate is a bad career choice. I started as a residential appraiser when it was actually a respected profession (early 1990's). I expanded my skill-set through the Appraisal Institute, learned how to appraise commercial property, and learned quite a bit. However, fees are low, even if you're an MAI. At least in the Chicago area they are. With all the stress of the classes (which they've revamped since I've gone through the program), and the stress of splitting the fee in half working for an MAI, getting up at 4:00 a.m. to drive comps and meet your deadline, and pull all-nighters to meet a delivery date, yeah...it's not worth the money. Brokering homes and small commercial property is, by far, a better way to make six figures. With all the training and rigorous coursework, earnings around the $200,000 mark should be easy...should be a five day work week, maybe 9-10 hour days. But, that's not the case. Most appraisers / MAI's that are sole proprietors bill around $12,000 to $17,000 a month, provided there is actually business out there to be had. And I can assure you, $150,000 as an MAI in Chicago doesn't go far. If you have a personality, brokering homes will bring you $150,000 without all the ridiculous federal regulation (and it's getting way, way, way out of control...with every financial downturn appraisers get slammed with more regulation, all while bankers, loan officers run wild without any licensing or regulation), USPAP, bad fees, ridiculous turn times, all for writing term papers the rest of your life. It's purgatory. And it's actually hell if you aren't an MAI because you work your behind off to make $65,000-$70,000, and you lose a lot of sleep. Be an actuary if you like numbers, not an appraiser. And if you like real estate that much, go take the classes at CCIM or sell houses. Much more fun, exciting, and potential to make more than $100,000-$150,000. Statistics and regression analysis is rendering the old judgment call almost meaningless. Appraising is a profession that is slowly going away, and it probably should. A good broker can give you a value in less time. They aren't regulated like appraisers, but they aren't any worse at providing market value. I'm a review appraiser, and I read fiction all day long. Garbage from very articulate, educated appraisers with degrees from excellent colleges. But if the number is wrong...well...it's wrong.

11/22/15

Thank you for your post! I'm a commercial appraiser in Chicago. What's the answer? How do you get out? I started a discussion about this but no replies yet.

Mark A.

2/15/16

Wow man, that's very insightful. I honestly feel bad for MAI's who are that bright and interested in the industry and are getting such low fees. That is brutal.

9/3/15

The USA still hasn't adopted IFRS standards which is why job opportunities are pretty bad for commercial appraisers. In the future, however, they do look optimistic.

1/27/16

I know several fee appraisers making 6 figures, but they all specifically cater to fund clients. Mark to market clients have their assets appraised every quarter, usually a more expensive self contained report once a year and then a summary report for the other three quarters, and most other funds value annually. But most of those appraisers are tied to the C&Ws and the CBREs of the world because it is hard to get on a fund's "approved appraiser list" as an independent. Also, many of them are certified in more than one state so that they can do that sort of work.

2/13/16

T

2/14/16

Can anybody speak for what Integra Realty Resources is like? Pay, culture, etc? I might have an interview here soon for an appraisal spot.

"There are only two opinions in this world: Mine and the wrong one." -Jeremy Clarkson

2/17/16

I can. Which city? PM me.

2/19/16

I came out of school and spent 3.5 years at C&W. After that I went to work for a REPE for a year and now am at a developer. Overall, I think it gave me a better handle on underwriting than most people at similar rolls, but I do think I was and still am weaker on a lot of other skills. Most the writing and communication in appraisal is boiler plate, excel requirements are pretty minimal and there's no requirement for any knowledge of debt.

As for pay, I made a little over 50k my first year and more than double that by the time I left. You'll make more money as an appraiser Years 2-5 than you would as an analyst if you're at a top firm, but then it gets flat and you're making 200-250k forever. Progression is trainee-->Certified General--> MAI. I don't think MAI's are as valued as they once were and that's reflected in the payscales at CBRE and Cushman. And AI practically hands them out now, so I wouldn't assume because someone has it they're any more equipped than someone without one.

I also think that appraisers at smaller firms (I'm talking mom & pop) would struggle to make a jump as they probably haven't seen as many investment quality assets or had as much exposure to market participants.

2/19/16

Anybody?

Mark A.

2/19/16

Asset Management at a balance sheet lender. You'll be able to put your appraisal skills to use there, but still have to deal with numbers. Should be much less stress...

2/19/16

THANK YOU! Who are balance sheet lenders? Could you list a few?

Mark A.

2/19/16

Most regional banks

2/19/16

I'd definitely look into becoming a real estate agent. You choose your own hours and if you're efficient, 6-figure income is totally doable. Plus you'll be out with clients a lot of the time.

2/19/16

A lot of people have made this transition. Appraisal requires a thorough understanding of CRE, so your skills are in demand. If you're looking for a 'relaxing' job, try local banks, appraisal management firms, or even government positions. I know they may not be easy to get, but there are still a lot of positions out there. Take a look at the popular job boards, and there is no shortage.

  • Anonymous Monkey
  • 4/28/16

Seems like a lot of bullshit artist posting on here. Granted I spent most of my life doing residential appraisal but have many friends in every facet of valuation and brokerage. Go get a real estate license if you want to be involved in real estate and drive people around and fill in the blanks on a boiler plate contract. You will make more money and enjoy a better work/balance. Most people don't work/live in Manhattan or DC or Boston so for average Joe after expenses doing residential work expect to bring home $40,000 +/- if you are compentant

5/6/16

I am in the DC market and I make about 150k per year. I have colleagues that make 200-250k as appraisers, not directors. Much of this thread seems inaccurate to me in terms of the low pay scale

5/9/16

The maximum fee split at any national firm is 45%. $250K is $50K per month in billings. Not impossible, but very difficult. DC has the highest fees in the continental US. Only Hawaii is higher, too.

5/25/16

I've been a commercial appraiser 16 years and awaiting MAI results from comp exams. I've been an independent contractor to a larger appraisal firm - fee split approx. 45% for appraisals and 10% for in-house reviews. I'm in that $150k zone (Los Angeles market). I'm 46 and ready to take the next step, which requires breaking away as an independent contractor and going after the clients myself. Furthermore, I plan to add 3 "mentees" looking to get their cert general hours for the state. Sounds easy enough, but in the cyclical nature of real estate, it is very difficult to give up the larger appraisal firm that has 80+ clients and has no lack of work during the "bad" cycles of appraisal. I read about CBRE and the other larger firms that require you to be an employee. I'm sure there are benefits along with potential for director positions, but I think my freedom is more important - I'm not that great at "falling in line" with structures. If I want to surf until 9am and skip the drive to downtown LA for a face-to-face hoorah meeting, I choose the former. And, screw having to wear suit and ties! With that said, I guess for $300k, I'd wear a suit coat.

3/25/17

Data point for those interested: Total pay for my first year working at a top appraisal firm in the Midwest as an analyst/trainee was approximately $70,000. There were a few 80 hour weeks, a number of 60 hour weeks, but mostly a very manageable 45-50 hours/week.

3/27/17

Large metro market in the southeast, one year of CRE appraisal under my belt. Salary is currently $40k. Still in the analyst role for some senior guys. Gross take home for these guys is between $80k - $200k, high end is of course, the MAI's. Solid foundational learning for CRE industry, but not enough debt or finance structuring knowledge. Also, appraisers are supposed to give an objective opinion of value, but really, how much is something worth? Only as much as a buyer is willing to pay.

There are reasons the average age of appraisers is increasing. First, the shitty appraisers make the rest look bad. Second, the fees continue to fall. Third, the hours and work environment sucks.

As a senior guy put it to me, after a while, the numbers in your account are just numbers you can't use.

4/5/17

Just out of curiosity, how difficult would it be to transition to an originations or underwriting role at a bank or life co from an appraisers job at a big firm (CW, CBRE, etc.)? With 5 yrs of appraisal experience and licensure. Heard that it's possible but I'm thinking that it would be a stretch......

4/6/17

The issue is that by that point, you are probably an MAI, pull in 6 figures and therefore will want an associate role (or higher) and won't have the experience that most firms will want at that level.

If you move at year 2 or even year 3, then you will have an easier time.

I moved from appraisal after a year to servicing, back to internal valuations, to asset/portfolio management, to origination, back to AM. The last three spots have been at life companies.

4/6/17

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