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Real Estate Appraisals and Software
An older company, Vision Appraisal from 1975, has many con-
tracts with municipal governments in a number of states to perform
periodic property assessments. (Vision Appraisal has a contract
with my home city for appraisals. Several years ago, it was neces-
sary for me to appeal and correct several errors in my property ap-
praisal, including an error in square footage and another error in el-
evation.)
Appraisals are frequently controversial and sometimes wrong.
This topic is beyond the scope of this topic, but suffice it to say that
property taxes are based on formal appraisals often by commer-
cial appraisal companies such as Vision Appraisal. If the appraisals
are wrong, the taxes will be wrong. Real estate valuation is highly
complex and also highly litigious.
There is also an Appraisal Standards Board and a nonprofit Ap-
praisal Foundation, which are quasi-official groups that set stand-
ards for property appraisals against which appraisal companies can
be compared, in theory. There are also professional associations
of appraisers, such as the American Society of Appraisers and the
American Appraisers Association. Even so, real estate appraisals
impact every homeowner and therefore will always be controversi-
al and subject to complaints by disgruntled property owners.
Many appraisal companies use proprietary and secret al-
gorithms, some of which are not even revealed to municipal tax au-
thorities. What is probably needed is an expert system that would
be a national standard method used by all appraisal companies and
validated by neutral disinterested personnel such as university pro-
fessors or nonprofit research groups.
Zillow generates its revenues by advertising on its website. In 2009, Zillow
formed an interesting consortium by licensing its appraisal data to about 180 local
newspapers around the United States. In 2011, Zillow and Yahoo Real Estate
entered into a partnership that became the largest real estate ad venue in the United
States.
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