Q&A with Cathy Magoutis, Director, Valuation Solutions

Cathy Magoutis is the Director of Valuation Solutions at FCT, driving some of the most cutting-edge solutions in the real estate appraisal space. In this Q&A, Cathy sits down with us to discuss the latest in automated and semi-automated home valuations, as well as the challenges and opportunities facing the industry.

What are the current challenges with home valuations?

I think the real estate industry has responded amazingly well to the volumes and market conditions that followed the start of the pandemic. The challenge is, with that success has come a shift in expectations.

Homes are still closing quickly, and homebuyers are competing intensely with each other. Consumers are seeing technology speed up the approval process, so they expect each step of that process to improve.

Lenders are expecting turnaround times on home appraisals to continue to get faster, in order to meet borrowers’ needs. This all needs to happen without sacrificing quality, in the middle of high volumes. To succeed in this environment, it’s going to take a combination of traditional appraisals along with automated and semi-automated valuations.

How can Automated Valuation Models (AVMs) help?

Automated Valuation Models (AVMs) are statistical models that use data like comparable sales, property characteristics and price trends to estimate a property’s current value. AVMs can provide accurate valuations within seconds, as long as they have enough data.

Lenders who subscribe to AVMs can provide quick responses to homebuyers in many cases, who then don’t have to wait and worry about their purchase deal. This method can be fast, cost-effective and accurate, but every system has limits. Providing accurate valuations for every property takes a versatile approach, and appraisers still play a vital role in that.

Which lending technology besides AVMs are you most excited about?

At FCT, we’ve developed a product called Flex Report™. It brings together the best elements of valuation technology and appraiser expertise for a cost-effective and accurate appraisal. Our technology combines about 250 data points with industry-recognized confidence scores, and provides results within four hours.

Another key component of our approach, and which is unique in market, is Property Valuation Indemnity Insurance (PVII) for all our qualifying real estate valuations. Regulated by The Office of the Superintendent of Financial Institutions (OSFI), that PVII wrapper indemnifies appraisers completing flex reports on FCT’s behalf.

How have lenders reacted to FCT’s hybrid model of valuations?

Providing a property valuation within hours or even seconds makes a massive difference in a fast-paced, competitive market.  The ability to choose automated, semi-automated or traditional appraisals gives lenders the flexibility they need to meet demand.

We’ve received overwhelmingly positive feedback from lenders, who are facing pressure from their borrowers to provide faster appraisals at lower costs. We believe our model meets that need perfectly, and so far, lenders are agreeing.

What other opportunities do you see for valuations and lending technology?

Automated products have a time and a place. But an appraiser will always provide the best valuation, and at FCT we strongly believe appraisers’ expertise cannot and should not be replaced. That’s why we’re focusing on ways to give appraisers new tools to work efficiently.

One challenge appraisers face is that gathering the data they need to make decisions is a time-consuming process. Our approach is to focus on getting that data for them and delivering it in a way that lets them use it best. FCT’s Golden Record is the Single Source of Truth (SSoT) for property intelligence in Canada. It gives appraisers a unified, validated source for property data like structural information, square footage, sales data and more. Appraisers can focus on completing valuation reports and increasing their revenue.

At FCT, we’re always looking to improve and streamline the valuation process with technology and data solutions. We support our appraisal and lender partners so that they can keep growing their efficiency, and better navigate the challenges of the market.

Learn more about FCT’s valuation solutions.