Haisler: Agents have upper hand in knowledge about real estate
There seems to be great debate as to who can truly provide the best opinion of value when considering the assessment of one’s property. Recently, a township assessor in McHenry County has been touting that appraisers are the best source for opinion of value – better and more reliable than real estate agents.
Appraisers and agents both access the local multiple listing service and use the same data set. Agents actually visit homes, verify data, take photos and enter it into the system. Often agents have been inside the homes they are providing as comparables to the taxpayers and have detailed knowledge of the differences between properties. Appraisers do not as often have such familiarity and it is not uncommon for an appraiser to call an agent to get better insight into a particular property.
Contrarily, assessors rely heavily on the recorder’s office for data. Assessors can see from the “green sheet” what a home recently sold for, but cannot see into the home and may be totally unaware of many salient details. Agents, on the other hand, know not only what it sold for but how long it was on the market as well as the original list price. Both will likely know if the property was a conventional “arm’s length” sale, a short sale, or a foreclosure (bank owned). That may or may not impact the price depending on the property’s condition.
So when it comes to who can provide a better estimate of fair market value, it would seem that agents and appraisers clearly have the advantage over the assessor, and that the data set used by both appraisers and agents is substantially identical, but with the agent often having more intimate knowledge of the respective properties. Assessors, who mostly do not have access to the MLS, have the least amount of information, one could argue.
So with that being said, why is it that there is an uprising of discontent amongst assessors and the state’s appraiser association to not allow real estate agents to be present as an expert witness during property assessment appeal hearings? Real estate agents testify to value in court proceedings. Furthermore, as pointed out, one can effectively argue that agents know more about the market. Is the data an agent obtains from the MLS less acceptable than the very same data typed into an appraiser’s work product? Obviously not. It might even be said that the data in the MLS is more current and, therefore, likely more accurate.
Perhaps from the appraiser’s perspective it is a fee-based argument. Appraisers may charge anywhere from a couple hundred to even thousands of dollars to do a certified (fee) appraisal for a client. Perhaps from the assessor’s perspective, discouraging taxpayers from obtaining an opinion from an agent, possibly for free, makes the taxpayer less likely to appeal their assessment; after all, taxpayers may not be able to afford a fee appraisal.
Additionally, it would seem allowing real estate agents to assist taxpayers as an expert witness of value at the hearing is a prudent thing to do and yet some are fighting to make it illegal for real estate agents to serve in that capacity. Regardless of the reason, taxpayers should be encouraged – not discouraged – from reviewing the accuracy of their assessment and providing the most comprehensive and factual data available. After all, shouldn’t the goal of the assessor be to have the most accurate information possible? And don’t even get me started on the Illinois Bar Association trying to enact a rule that says only the taxpayer or an attorney may represent the taxpayer during an appeal. For example, why can’t a trusted agent or an adult child of a taxpayer utilize a power of attorney to assist their client? Bureaucracy is getting out of hand. We certainly don’t need to make this simple process more difficult or costly.
• Jim Haisler is chief executive officer of Heartland Realtor Organization, serving real estate professionals throughout northern Illinois.