New ‘Market Conditions’ Home Appraisal Requirements

Fannie Mae, Freddie Mac and the appraisal institute just released a good presentation on new industry-wide appraisal requirements going into effect May 1, called the Home Valuation Code of Conduct (HVCC). The high points of HVCC are that it will require that banks order appraisals and not loan originators in direct contact with the consumer, and that appraisers must use the Market Conditions Addendum.

It’s a highly explicit market analysis that only the good appraisers would add to their reports before now. Now all appraisers will be required to use this form for all reports, and the presentation does a good job of explaining what it is and how it’s supposed to help improve home price analysis.