The final results are in and they ain't good: Appraisers are feeling big time pressure to overstate values.

Indeed, undue pressure is the primary reason the 500 valuation professionals responding to an independent national survey say they refuse assignments.

The study was conducted by October Research of Richfield, Ohio, which says it anticipated the results but not their "frequency and widespread nature." The survey did not say whether the pressure was being applied by home buyers, sellers, their agents or lenders.

Every party to the transaction wants the value of the property to be close to the agreed upon selling price. If it falls short, buyers will have to come up more cash to complete the deal or sellers will have to take less.

In most cases, the deal falls through. The owner loses the sale, the buyer loses the house, the real estate agent loses his commission and the lender loses the loan. But because appraisers are hired by lenders and more than a third said they feared losing assignments if they didn't comply, it must be assumed that it was lenders who are most guilty of trying to coerce appraisers.

And speaking of guilt, when respondents were asked how often they think their peers succumb, the overall sentiment was that "everybody does it some of the time."

More than half the respondents, all of whom have been in the business for at least five years, said they felt coerced into overstating actual values at one time or another. And more than 40 percent said they felt they were being pressed in as many of 20 percent of the transactions on which they were asked to provide valuations.

Even worse, nearly 1 in 10 said they felt they need to boost their true findings in 1 out of every 2 cases.

More alarming, perhaps, is just how high appraisers are being asked to raise their valuations. More than half the time, they are asked to inflate the value by up to 10 percent. And in 41 percent of the cases, they are asked to boost their findings by 11-20 percent.

But in 8 percent of the cases, they are being pushed to up the ante by 20 percent or more, researchers found.

The study also found that undue pressure is the primary reason appraisers refuse work.

Appraisers also said they are feeling the pinch to finish their assignments more quickly than possible.

For the most part, they say they can't complete their work because they are unable to gain access to the properties, they are simply too busy or the assignment is more complex than originally thought.

At the same time, two-thirds of the respondents said they are likely to put a job at the bottom of the in-box if they feel they are being treated poorly or unfairly.

Published: March 10, 2004

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When Lew Sichelman first started writing about housing in 1969, he was the youngest real estate writer in the country. Now, 37 years later, he's one of the oldest -- and most decorated. He has been rated the top housing columnist in the country by the National Association of Realtors as well as by his peers in the National Association of Real Estate Editors. Indeed, NAREE has recognized his work on numerous occasions. One year - due to his advancing age, he can't recall which one - he earned top honors in the annual NAREE Journalism Contest in three out of the four major writing categories. It was the first time one writer has won so many NAREE awards in a single year. Known for his ability to make even the most difficult topics understandable, Sichelman also has been honored by the National Association of Home Builders and the Mortgage Bankers Association. He began providing in-depth coverage of and consumer-oriented information about housing and housing finance at the Washington Daily News, where he was real estate editor. He held that same position for nine more years at the Washington Star, which purchased the News in 1972. The Star, a so-called "writer's newspaper" which also had the misfortune of being an evening paper, was put out of its misery in 1981, and Sichelman, who had begun self-syndicating his column in 1978, decided to become a full-time columnist. Today, his column, "The Housing Scene," is distributed by United Media to newspapers throughout the country. He also is on the staff of National Mortgage News, an independent newspaper which is considered the bible of the mortgage business. And he writes for numerous other publications, including MarketWatch.com, where he answers readers questions once a week, Sports Illustrated (don't ask), RealtyTimes.com, BigBuilder and others. Sichelman is married, the father of five and grandfather of eleven.