From a veteran appraiser, an assessment of Tampa Bay's housing market

In real estate transactions, the most visible players are the agents representing buyers and sellers. But it is the work of appraisers that helps determine the true value of a home and what a bank is willing to lend.

Joni Herndon of Tampa has been a state-certified residential appraiser since 1985, maintaining a strong reputation in a field that got a black eye as a result of appraisal practices that contributed to the housing bubble and crash. From 2006 to 2013, Herndon was a member of the Florida Real Estate Appraisal Board and served as its chair in 2008, 2009 and 2013.

An Army brat, Herndon was born in Anchorage, Ala., but grew up in Tampa and graduated from the University of Florida. She owns Real Property Analysts/Gulf Coast, which has four appraisers including herself.

In this interview with the Tampa Bay Times, Herndon, 60, talks about the changes in the appraisal industry, the challenges of the job and what she sees as the bay area's hottest real estate markets. (Hint: There are some areas you might not suspect.)

During the bubble, do you think appraisers were artificially inflating the value of homes as some critics have charged?

That time period, 2002 to the financial crisis in 2008, was just a tsunami of forces — easy money. If you were breathing, you got a loan. A lot of people were getting into the (appraisal) business that weren't properly trained, and all of a sudden you had some folks, especially on the lending side, who weren't happy if you didn't make value on certain properties. With that said, I don't know if it was artificially inflating or — what did the Fed chairman say? — "irrational exuberance" in the market. There was some refinancing going on where they would give you 125 percent of the market value of a home. If that doesn't encourage borrowing, I don't know what does.

The appraisal board must have been busy with complaints against appraisers when the bubble burst, right?

The heaviest time we had was probably 2007 to 2010. The market was slowing down, people couldn't buy and flip like they wanted to. There was lots and lots of work at the board in 2010 because short sales were the soup du jour and folks thought it was the appraisers' fault that they were upside down on the property, and some of that was rightly so.

How many appraisers left the field?

Our ranks went down from about 11,000 to about 8,000 My guess is that during my tenure, we probably revoked 1,000 licenses and the rest just surrendered them, gave up, said there was no work for them and that was the end of them.

The Dodd-Frank reforms after the financial crisis created a "firewall" to eliminate pressure on appraisers to come in with a certain value. Now, instead of a loan originator or a real estate agent calling an appraiser directly, they have to hire one through an appraisal management company. How has that worked out?

It's not working. Out of that came the false premise that no one could talk to an appraiser — the listing agent couldn't, the selling agent couldn't, the sellers and buyers couldn't. That's the flaw. What it is, is that you can't improperly influence an appraiser, but you can give me information. The incompetent appraisers love (the changes) in that they feel like they're well-insulated. But nobody can get to them to explain that property in the Old Northeast (part of St. Petersburg) sold in one day and had 15 offers so that's why the purchase price exceeds the list price.

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Has working through appraisal management companies hurt appraisers financially?

My appraisal fee without the AMC would be, say, $1,000. With the advent of the AMC, they can't charge the consumer more, so what they do is say, "I'm going to take 20 percent of your fee, Joni, so instead of being $1,000, your appraisal fee is $800." It boggles my mind.

From what you're seeing, has the Tampa Bay market fully recovered?

No, I don't think it's 100 percent cured. There are still short sales sitting out on the market, still foreclosures in process for years that the banks don't want, people don't want. I'd say we're probably at 90 percent, and it's that 10 percent in certain markets that keeps dragging down values.

What are the hottest markets in the Tampa Bay area?

Downtown St. Pete, Snell Isle and the Old Northeast is probably the hottest market in my view. That would edge out a little South Tampa, which has been strong for ages. There are folks moving out of Belleair, off Boca Ciega Bay back to Snell Isle because it's close to downtown where there's so much going on after dark. It's alive, it's vibrant.

What other areas are hot?

Lansbrook in Palm Harbor is very strong, Seven Oaks and Trinity in Pasco are very strong, and in Hillsborough, Carrollwood Village. Of course my favorite is Seminole Heights. I have to say it because I've lived there since '87. It finally caught on fire in like the last two years, the restaurants, the bars, the craft beer places, the shops. It's camp, it's really cool. It's just five minutes to downtown (Tampa) and 15 minutes to the airport. It's always been a very diverse neighborhood. There are blacks, whites, LGBT people, young people, old people.

Any others?

The Garden District in St. Pete, west off 34th Street to about 58th Street and south of Ninth Avenue North to Central, that little corridor there is a sleeper. In Tampa, the Forest Hills area north of Busch Boulevard near Chamberlain High School. Lutz is now in high demand because of all the lakes through there. And the whole East Lake Woodlands area because it has attached villas — one-story, 1,400-square-foot villas with garages for folks downsizing. Those kinds of properties are in really high demand.

What are the challenges in doing a good appraisal?

It's the time to do the appraisal, enough time to adequately verify the information of the comparable sales you're using. Another thing that's hard about doing a good appraisal is that buyers and sellers believe Zillow is 100 percent accurate, and it never is. I think it's 95 percent inaccurate and probably in most instances it overestimates value.

Contact Susan Taylor Martin at smartin@tampabay.com or (727) 893-8642. Follow @susanskate.