I keep hearing that appraisers and bad appraisals are part of the reason why property values are in such bad shape.
Yes, like anything else there are those few bad apples that can give the rest of us a bad name. But in general, appraisals were being done competently and professionally. My fifteen years of appraisal review helped confirm this. The majority of the appraisals I review are accurate and professional.
The real problems were that prior to the market bubble bust, if an appraiser were to have said, "yes, there are comparable sales to support the sales price, but I cannot appraise it for that amount because an appreciation rate of 20% over six months with only a new paint job defies all historical and current market and finance analysis. Those comparable sales are inflated because they were purchased with money that should not have been loaned"! The appraisal would have simply been reordered with another appraiser who was willing to not look beyond those comparable sales. The first appraiser would have been "black balled" by all parties involved in that sales deal, never to receive any work from those sources again.
Appraisers do not have enough clout or influence to go against all the other players in the real estate deal who get paid when the deal closes. Even after all the trouble this economy is in, these same forces are still obstructing the necessary overhaul of how real estate transactions take place and ignoring the fact that the "appraiser and appraisal" has to be looked at as the foundation of any real estate deal.
Suggested solution: make it mandatory to get an appraisal first. Include a specific value range in the appraisal (comes from comparable sales considered), then use that value and value range as a bases for everything else, marketing, negotiating, financing etc...