The pressure is on.

With tightening margins, banks are scouring their balance sheets, hunting for opportunities to cut costs. However, it’s vital that in this quest for efficiency to understand that letting go of appraisal department talent is a HUGE mistake.

If banks make the mistake of laying off these professionals to cut costs, we risk a significant “brain drain” in the real estate sector. Strategically very short sighted, especially considering the shrinking pool of qualified appraisers, an aging workforce, increased regulatory demands and the long-runway to obtain valuation expertise.

Valuable Niche Knowledge

This segment of the bank holds professionals with incredibly niche knowledge. Appraisers and reviewers are not just personnel; they are trained professionals with expertise that can’t be quickly replicated. Their knowledge and judgment form the bedrock of crucial financial decisions, and without them, the stability of the real estate financing ecosystem could be at risk.

So, how can banks maintain this delicate balance?

Retrain and Upskill: Instead of letting go of personnel, invest in their upskilling. Cross-training employees ensures that they can wear multiple hats, giving the bank flexibility. With broader skill sets, they can contribute in various capacities, ensuring the bank gets more bang for its buck.

Remote Work Options: The pandemic taught us the viability of remote working. Many functions of the appraisal process can be done from anywhere. By offering flexibility in work arrangements, banks can reduce overhead associated with maintaining large office spaces.

Strategic Outsourcing: There are parts of the appraisal process that can be outsourced without compromising the core functions. Outsourcing data entry or preliminary analysis can save costs and allow in-house experts to focus on more nuanced parts of the job.

Review Processes for Efficiency: Often, costs creep up due to outdated processes. Conduct regular reviews to identify bottlenecks and redundancies. Streamlining these can lead to significant savings.

Embrace Technology: Technology can automate many of the more routine tasks that once consumed hours of manual labor. From property data collection to analytics, there are workflow software solutions that can streamline operations without compromising on quality.

Knowledge is invaluable, retaining talent is more critical than ever. Ensure that appraisers and reviewers feel valued. A loyal employee is not just a cost center; they’re an asset. Their deep understanding and commitment can lead to innovation and improved processes.

The challenge facing banks today is undeniable. Margins are low. Lenders are not lending but rather in  client relationship building mode. As Chief Appraiser, how can you bring more value to your bank?

Consider streamlining outdated processes, bottlenecks and redundancies.

Your people are your No. 1 asset.

Don’t let go.