Monday, October 13, 2014
It has been almost 3 months now since I’ve done a foreign appraisal assignment, and there are a couple of reasons for this.
1. I’ve had a large increase in business in appraisals of domestic “solar farms” (photovoltaic energy generation) in the U.S. Southwest, and
2. Foreign appraisal assignments have been offered to me with “conditions” that would compromise the ethical code most appraisers follow, conditions which would require me to deceive lenders or the U.S. Internal Revenue Service.
Here are some situations:
1. An owner of a high-end condo on Grand Cayman Island was fishing for an appraiser who could guarantee that his condo was worth $2 million in every year that he has owned it since 2006. But the Caymans have had the same rise and fall as every other Caribbean condo market, and it would not seem reasonable to anyone, including the Internal Revenue Service, that it had been worth the same amount in every year since 2006. The fact that he did an e-mail broadcast of these appraisal conditions to other appraisers could also end up getting him into trouble with the IRS, who provides rewards to whistleblowers.
2. Developers of ocean view residential subdivisions in Brazil and Costa Rica wanted to me to provide current market value opinions on their subdivisions without having me visit their properties. Yes, I was already familiar with their subdivisions, but a determination of current market value requires me to know current market conditions in these respective localities, requiring that I visit and analyze competing subdivisions, too.
“Desktop appraisals” (appraisals done without a property inspection) have limited reliability for overseas properties and are not likely be taken seriously by lenders, either. I also need to see if amenities, such as the guardhouse, pools, recreational areas are operational and that infrastructural development is continuing.
Vernon Martin performs due diligence and appraisals on commercial and residential real estate throughout the world. He has 37 years of commercial appraisal experience and has worked in more than 20 countries, 43 U.S. states, and 5 Canadian provinces. He started his career at the global firm Jones Lang Wootton and went on to become the chief commercial appraiser at 3 national (U.S.) lending institutions, formerly taught Real Estate Valuation at California State University, Los Angeles and has authored many professional journal articles and two books. He has degrees from the University of Chicago and Southern Methodist University and is a Certified General Appraiser and a Certified Fraud Examiner. He also appraises specialty properties such as solar farms, wind farms, cannabis-related real estate, golf courses and ski resorts. If you have a particularly difficult property needing a valuation, send your inquiry to Mr. Martin and he may be able to help. For more information, call 1-323-788-1605, or e-mail him at email@example.com .