Appraisals: 'the eyes of the lender'

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  • | 12:00 p.m. June 17, 2005
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by Mike Sharkey

Staff Writer

There are several key facets of a residential real estate transaction. A knowledgeable, friendly realtor is certainly key. Finding an honest mortgage broker and securing fair financing is vital because buying a home is a long-term investment for most. However, the appraisal may be the most integral piece of the home-buying puzzle.

“In my opinion, the appraisal is the critical point in the process,” said Bob Steeg of Steeg & Associates. “The banks and mortgage brokers come to us when the person buying the home is deemed credit worthy. As the appraiser, we are typically the last one in the loop. Often, the property is under contract two to three weeks before we are contacted.”

Steeg said batting clean up in a lineup that includes three other stages makes his role that much more important. Regardless what the buyer wants or the seller is willing to pay, his office has the final say in what the bank is willing to lend.

“Sometimes, we have to tell the bank what they don’t want to hear,” said Steeg. “Our job is to make sure the bank doesn’t make a bad loan on a bad piece of property. We are the eyes of the lender.”

The appraisal may also be the most misconstrued step in the process. Anyone, buyer or seller, can locate and hire a real estate agent. In fact, realtors may solicit business. The appraisal industry is different.

“We must, by law, be engaged and employed by the lending institution,” said Steeg, who is in business with his father, brother and two other full-time appraisers. “Neither the individual nor the realtor can employ us.”

Steeg & Associates has been in existence for 47 years and they have watched as the real estate market in the five-county region has gone through several transformations. The lean years of the 1970s have given way to an early-century explosion that rivals anywhere in the country.

Steeg said increasing appraisal values are a byproduct of the current explosion, but not all of it has to do with new development. There’s a huge demand for existing homes on long-established properties that have propelled market values skyward.

“The last three or four years the demand for waterfront homes — oceanfront, riverfront and canal front — have really increased tremendously,” said Steeg, who with 24 years is the least experienced appraiser in the office. “Older areas of town are doing really well, too; areas like Avondale, San Marco, Riverside and St. Nicholas. Some areas are doing better than other, but no area is decreasing or even staying relatively flat.”

Property Appraiser Jim Overton agrees.

Since taking over the job in July 2003, Overton has been in the process of updating appraisal values across the entire county. Unlike Steeg, Overton’s office appraises entire neighborhoods at a time because he’s required to. And, while his office conducts their appraisals more for taxing purposes that transaction purposes, the results are often similar. And, they see the same trends.

“The beach is hot and it’s going to stay hot for a while,” said Overton. “The beach just about doubles the appreciation of anywhere else in town. We have not finished San Marco yet, but suspect it will be a lot like the beach. Avondale is not far behind and Springfield is moving up. Nothing is struggling, but some areas are not going up as fast as others.”

Also unlike the private appraiser, Overton and his office’s web site are a wealth of information. While Steeg is obligated to divulge values only to the financial institution that hired his company, Overton breaks down every property into many categories, all of which are useful to buyer, seller, realtor and curious web surfer alike.

Every piece of property, both residential and commercial, is listed on the site (, go to departments on the left, scroll down to Property Appraiser and click “go”).

Under each listing is a history of the property with everything from its owner to the last transaction price to the square feet to the type of construction. Each listing also includes tax information (county, school, district, other and voted on taxes) as well as a link that will map the property and a printable version of the information.

There’s much more and Overton needs help making the site even more informative.

“I need realtors to tell me what else they want to see on the site,” said Overton. “We are not MLS, but I need to know what’s missing.”

—May 11, 2005