Appraisal Institute Research Addresses Valuation Issues and the Upcoming Elections
The Appraisal Institute along with its government relations consulting firm Rich Feuer Anderson produced a comprehensive pre-election 2022 outlook that addresses how the upcoming elections relate to the financial services sector.
Several bills affecting the valuation profession may see action during the post-election lame duck congressional session, a period that typically is reserved for must-pass legislation that has general concurrence from both the respective chair and ranking members of the committee of jurisdiction. It also involves items that can easily be negotiated between House and Senate members. Some of those bills include:
- S 4208 / HR 7735, the Improving Access to the VA Home Loan Act, which would require the Department of Veterans Affairs to update appraisal requirements for the loans it guarantees. The legislation is an attempt to align VA policies related to desktop appraisals and other flexibilities offered by the government-sponsored enterprises. Earlier this year, the VA released new policy regarding desktop appraisals, but it also has had rules in place for years related to appraisal waivers through refinance policies.One provision in S 4208 would require the VA to consider changes in quality control processes, which concerns the Appraisal Institute because as written it is undefined and subject to broad interpretation if applied to such issues as the VA Fee Panel itself. Action on this bill is likely given that it has bipartisan support in both chambers of Congress and the apparent general support from the VA.
- HR 3008, the Homebuyer Assistance Act, is legislation that would modify appraiser requirements for mortgages insured by the Federal Housing Administration. Currently, FHA appraisers must be “certified” by state or national entities, but this bill would eliminate national entity certification and instead allow appraisers for single-family housing to be state-licensed (not only state-certified). Additional specified FHA educational requirements would also apply. This bill is an amendment to the National Defense Authorization Act, which likely will receive consideration during the lame duck session. The FHA amendment has received strong support in recent sessions of Congress and stands a chance to be included.
- The National Defense Authorization Act contains another appraisal-related amendment, one that borrows a provision from HR 2553, the Real Estate Valuation Fairness and Improvement Act, which served as an early model for the Property Appraisal and Valuation Equity Task Force, known as PAVE. This provision relates to the Appraisal Subcommittee establishing a grant program authorizing $50 million over a three-year period for states, nonprofit organizations and institutions of higher education to promote diversity and inclusion in the valuation profession. Complicating the passage of this provision are several questions about the authorization and appropriations process and how it would apply to the Appraisal Subcommittee as an independent agency as authorized by a national defense bill.
- S 4808, the Enhancing American Retirement Now Act, is a bill with an amendment added during Senate committee consideration that attempts to reign in syndicated conservation easement transactions. AI has long supported such provisions and currently is reviewing additional provisions added to the amendment and working with historic preservation advocates to address concerns about potential unintended consequences. Chances for this legislation to move forward are moderate, given its inclusion in an important piece of legislation that has momentum but also several issues that must be resolved for it to receive clearance.