Appraisers and the market

Today’s Real Estate market is under the control of the new third party appraisal machine that is an overreaction to the issue of home value causing so many home owners to be upside down on their mortgages. What has happened is that we are getting appraisers from other counties coming to appraise properties in areas they know nothing about and then providing what can only be termed as horrific values. The problem is further exacerbated by the fact that if it is an FHA appraisal the value stands in the system for 6 mos with no ability to be changed. The pendulum has swung so far in the wrong direction that more often than not we are seeing mortgage underwriters arbitrarily saying they do not agree with the appraisals that are reasonable and not approving loans based on some bogus AVM that is wrong 90% of the time. Where is the parity and who is policing this. The cause and effect is further throwing home values in the toilet. Even if an arm’s length transaction has a buyer willing to pay a price that a seller wants to accept - and comps bear out the value, underwriters are arbitrarily saying no just because they disagree - with no real solid rationale to support the conclusion. These appraisal practices could keep the housing market in a serious state of recession for years if something is not done by the power being wielded by appraisers and underwriters who often times feel they are on a one man crusade to protect the universe from what they feel are high values - realistic or not!! They seem to feel we need to continue this declining market mentality in perpetuity and then they make it a self fulfilling prophecy because of their appraisals that arbitrarily apply a decreased value below what the market shows. It leaves everyone asking why????