There's an appraiser shortage in California. It's real, it's affecting closings, and I'm in the middle of it.
Why the Shortage Exists
In the last 15 years, the number of licensed appraisers in California has dropped significantly. Here's why:
Regulatory Burden: New appraiser licenses require 150+ hours of education, 3,000 hours of supervised practice, and passage of rigorous exams. Fewer people are willing to do it.
Income Reality: Appraisers make less than they did in 2008 (adjusted for inflation). That's a deterrent for new people entering the field.
Demographic Reality: Most active appraisers are 50+. We're aging out of the profession faster than new appraisers are entering.
Burnout: The pandemic boom of 2021-2022 burned out a lot of younger appraisers who couldn't handle the volume.
The result: Fewer appraisers, same demand.
The Ripple Effect
When there are fewer appraisers, transaction timelines suffer. A typical appraisal takes 3-4 weeks from order to report. During shortage periods, it's 4-6 weeks or longer.
I'm booked out 3-4 weeks right now in January 2024. That might not sound like much, but it compresses timelines for everyone else.
A buyer wants to close in 45 days. If the appraisal takes 5 weeks and inspection takes 1 week, you're left with 3 weeks for everything else. That's tight.
Market Impact
Appraisal delays don't just inconvenience people. They kill deals.
A buyer can't get a clear financing commitment until the appraisal comes back. A seller can't accept an offer knowing closing might slip 2 weeks because of appraisal delays.
In a tight market, appraisal delays cost transactions.
How Lenders Respond
Some lenders have started using "rush appraisals" or "expedited appraisals" where the fee is 20-30% higher and the timeline is 2 weeks instead of 4.
This helps some transactions, but it's not a systematic solution. It's a band-aid.
Other lenders are resorting to AVMs (Automated Valuation Models) for certain property types, eliminating the appraiser altogether.
That's a temporary fix that creates long-term problems (AVMs aren't as accurate as human appraisals).
The Quality Question
With fewer appraisers, there's pressure to cut corners. Rush appraisals are quicker but sometimes less thorough. Online appraisals (desk appraisals) skip property inspection.
In my 40+ years, I've never rushed an appraisal or done one without seeing the property. I'm not willing to sacrifice quality for speed.
But not every appraiser has that standard. Shortage creates pressure to compromise.
What I'm Telling Clients
If you're buying or refinancing in 2024 and you need an appraisal:
- Order it immediately — Don't assume you have time
- Budget for delay — Plan for 4-5 weeks, not 3
- Don't use rush fees unless necessary — Pay the extra 30% if it's essential, but otherwise plan ahead
- Make sure the appraiser visits your property — Desk appraisals are cheaper but less reliable
Is It Getting Worse?
In early 2024, it's not getting worse, but it's not improving. The shortage is persistent.
Over time, I expect retirement to worsen the problem before solutions kick in. More experienced appraisers will retire. Replacements will take years to train.
The long-term fix is either higher appraiser fees (to incentivize entry into the profession) or regulatory changes (to make becoming an appraiser easier).
Neither is happening quickly.
The Consolidation Reality
Some of the shortage is being addressed by appraisal management companies consolidating work. Instead of independent appraisers handling their own clients, they work through large companies.
This changes the dynamics. Fees get compressed. Quality gets questioned. Personal service disappears.
I've chosen to stay independent. It means I'm busier than I'd like to be, but it means I control quality.
What To Expect in 2025
If the appraiser shortage persists (which it will), expect:
- Longer appraisal timelines
- Higher appraisal fees (as demand exceeds supply)
- More pressure to use desktop appraisals
- Potential decline in appraisal quality in competitive areas
For homeowners: Plan ahead. Don't assume appraisals will happen quickly.
The shortage is real, and it's not going away soon.