The agenda included reports from the NAR representative to The Appraisal Foundation Advisory Committee, Vic Knight, and an update about The Appraisal Foundation from the NAR representative to Board of Trustees. H.R. 4173, the Dodd-Frank Wall Street Reform and Consumer Protection Act was discussed, along with our participation in the rules-making process. The committee was briefed on the activity of the NAR HVCC Work Group, and the progress of the Realtor's Property Resource (RPR).
The Appraisal Committee learned that Joe Traynor, GAA, a past Chair of the Committee, has been selected as Chairman of The Appraisal Foundation Board of Trustees for 2011. Another past Chair of the Committee, Vic Knight, has been named as the NAR representative to the Board of Trustees. The Chair of The Appraisal Foundation's Appraiser Qualifications Board (AQB) is another past Chair of the NAR Appraisal Committee, Rick Baumgardner. Since one of the 2011 goals is to maintain NAR representation within The Appraisal Foundation, it's nice to see an early fulfillment of that aspiration. All three are good friends, and tolerate my kidding them about going over to the Dark Side.
In addition to the above accomplishments, the Committee discussed the upcoming meeting of the NAR Professional Standards Committee. Back in August, 2010, the Appraisal Committee submitted a letter to the Professional Standard Committee with several suggestions for amendments to the NAR Code of Ethics and Standards of Practice. The recommendations were considered by the Interpretations and Procedures Subcommittee, and their report would be considered by the full committee. Later, it would be considered by the NAR Executive Committee and Board of Directors.
Although not all of the Appraisal Committee recommendations were accepted, two important ones were, and approved by the Board of Directors.
Standard of Practice 3-7 was amended to recognize that appraisers do not typically "represent" a client. Realtor Appraisers, when seeking information about listed property, now must merely disclose the "relationship" with their client to the listing Realtor. Representation of the client is no longer required.
That's nice, but the Board of Directors also approved an amendment to Article 15, and Standard of Practice 15-3. An amendment to an Article of the Code of Ethics must be approved by the NAR Delegate Body. The Delegate Body will consider this amendment in Anaheim, California during their meeting on November 14, 2011. If approved, Article 15 will read:
REALTORS® shall not knowingly or recklessly make false or misleading statements about other real estate professionals, their businesses, or their business practices.
The amendment to Standard of Practice 15-3 will be effective if the change to Article 15 is adopted by the Delegate Body. It will read:
The obligation to refrain from making false of misleading statements about other real estate professionals, their businesses, and their business practices includes the duty to publish a clarification about or to remove statements made by others on electronic media the REALTOR® controls once the REALTOR® knows the statement is false or misleading.
Since many Realtor Appraisers have expressed their concern about the Quadrennial Ethics Training Course, we're in the process assembling a group of folks to make some recommendations for course content. It's unlikely that fulfilling this education requirement will ever be a favorite for appraisers, but we aim to make the content more appropriate for our niche of the real estate profession.
Well, that's part of what the Appraisal Committee has been up to. There's more and more updates to come. There are a few appraisals on my desk to complete.
“That NAR’s Appraisal Committee be asked to provide content applicable to appraisal practice and NAR’s Code of Ethics, and that such content be developed as a separate course or an optional component of the existing Quadrennial Ethics Training Course.”There was one additional recommendation considered by the Professional Standards Committee: Currently, the term "competitors" is used in place of "other real estate professionals".
Rationale: A separate ethics course, or course component, with content applicable to appraisal practice would make the Quadrennial Ethics Training requirement more meaningful to the appraisal practitioners as they satisfy their ethical duties of REALTOR® membership.