Appraisal Database Gains Area Acceptance
DaParma, Ron, Tribune-Review/Pittsburgh Tribune-Review
Thomas Inserra grew up in Plum and used to deliver newspapers to homes in that Allegheny County community.
Now CEO of Zaio Corp., Inserra hopes to include homes in Plum and all other communities in the Pittsburgh area in a nationwide database designed to change the way many appraisers do business.
"That (delivering newspapers) was Mr. Inserra's first job," said John Ross, vice president with Zaio, a 3-year-old Canadian company with its U.S. headquarters in Scottsdale, Ariz.
Zaio's goal is to sign up appraisers in 250 U.S. cities to participate in the new database. It will include photographs, value estimates and other data for what ultimately could be 75 million properties nationwide, said Ross.
"We already are active in over 50 of the 250 cities," Ross said. "We have plans to move into another 50 by the end of this year and hope to get the remaining 150 started next year."
On board in the Pittsburgh area is Nicklas, King and McConahy, a Cranberry-based appraisal firm with an affiliate office run by appraiser Bruce Irwin in Greensburg, said David King, a partner in the firm.
The company, which is the designated Area Development Office for Zaio in Allegheny, Beaver, Butler and Westmoreland counties, is in the process of lining up appraisers to participate in the program.
Zaio has set up 65 "zones" in the four-county area -- geographic areas based on zip codes with up to 10,000 homes in each zone -- that are to be sold to appraisers for $9,800 each, King said.
So far, King's company has sold 20 "zones" to local appraisers in his four-county area. Zaio is seeking other companies to sign up as Area Development Offices for other counties in the region. He expects it will take about one year before the system is operational here.
Nationwide, Zaio hopes the database will include 7,500 zones in the U.S.
After buying the zones, the appraisers will work to sign up clients who will pay for the appraisal information, with a principal target being lending institutions who use appraisals as they consider applications for mortgages and other loans.
"But there is a very large potential market that goes beyond lenders," said Ross.
Others who may want to use the information might include home builders, home improvement retailers, and even Wall Street companies who trade securitized packages of home loans on the secondary markets. Often these companies have to verify valuations of the properties that back these securities to determine what they are worth, he said.
The data will be not available to the general public. Clients pay a fee ranging from $150 to $300 per house to use the system and are given a password to access it.
The designated Area Development Offices receive a 5 percent share of the revenues from all data sales within their market, while the individual appraisers who have purchased the zones receive a 44 percent to 59 percent share, Ross said. The actual amount depends on a number of factors, including the volume of business their clients generate.
Zaio's share is about one-third of the revenue.
"We handle the national marketing, develop the software and maintain the database to make sure it stays current," Ross said. "We pay for the data and pay the photographers who take the photographs.
"When (an appraiser) buys a zone, they get the right to offer property valuations using the Zaio method within that zone," said King. "The first step is to take a picture and get an image of every house within that zone."
The local appraiser will use public records to gather information about a property, and then will express a professional opinion of the home, taking into account such things as comparable values, location, size and condition. …