The current requirements for appraisers of Federal Housing Administration-insured mortgages are too onerous. This has resulted in a shortage of appraisers for such homes, which is burdensome for certain types of prospective home buyers (specifically, first-home buyers, low- and moderate-income households, minorities, and those in rural areas).
Rather than trying to increase the number of FHA appraisers, mortgage issuers and the federal government should think critically about whether and when human appraisers are necessary. Big data and automation could potentially replace the need for human appraisers. Alternatively, the de minimus threshold could be raised to decrease the number of homes that need appraisal.