An Auction Result is Not an Appraisal!

Auction results are a large part of the data an appraiser interprets to for their value conclusion – but they are far from the only thing!

In any first consultation with me, a client identifies the intended use of the appraisal, and together we determine the objective. These two things help me determine the most appropriate market or markets to search for sales and pricing data, whether for comparable sales, or prices of like items or reproductions.

The most appropriate market is where the items are most commonly bought and sold by buyers and sellers in full possession of all relevant facts about the items and under no compulsion to either buy or sell.

On top of all this is an item’s physical characteristics, and often enough in my corner of the appraisal world, a provenance that establishes additional historical significance. Both can have an effect on value.

So you see appraisals are a multi-faceted process with many moving parts! It takes a mind adept at compilation, interpretation, and interpolation of data to reach a justifiable value conclusion – far more than a simple search of realized prices!

Be Sure of Identity and Value -- Call Your Appraiser!

Pretty sure this didn't end well.

About Your Stuff: Fact or Belief

Sometimes a client believes they know all about their item before they reach out to me for an appraisal. 

Sometimes this information is the product of a generation or more of family members repeating - and sometimes adding to - the romantic lore around an item. Many times, though, they only have part of the story.

One of the hardest tasks I face as an appraiser and historian is telling someone their beloved story is only partially true or that the current market doesn’t support their assumption of value. The worst is when I have to contradict some deeply held or sentimental belief.

While there are many wonderful things about being an appraiser, one of the best moments for me is when I suspect that reality is even more interesting and windswept than family lore. Admittedly, such moments are rare. However, it’s always wonderful when I am able to tell them straight away and illustrate the point with physical evidence provided by the item itself.

Yet no matter what the news, there’s an art to informing a client gracefully.

Long before I deliver a report, though, comes the research phase. It is in this magical period, my favorite in fact, that I may discover a previously obscure historical aspect or component of the item about which my client had no clue. 

It is in this ability to sniff out historical detail that I take especial pride.

It might be as simple as translating an obscure phrase, deciphering an unknown symbol or logo, tracing a signature or maker’s mark. Yet because such historiographical detail may add significant support or additional value to their item, it is vital to a complete and accurate appraisal.

As I always say, be certain of identity and value – call your appraiser!

Be Sure of Identity and Value -- Call Your Appraiser!

Professional Jewelry Appraisals Have a Home in Kansas City!

The phone rings. The voice on the other end is tinged with exasperation. “My family is working through my late mother’s estate. She’s got lots of antiques and a lot of regular stuff, too. And jewelry. Lots of jewelry. We’re a little overwhelmed trying to figure out what the value on it all is before we decide what to do. We really need help.”

While I can help with much of the estate, there is a group of things outside my areas of expertise - jewelry. And for just this sort of eventuality, I maintain a network of appraisers that specialize in areas outside my own. These I can either pull in to complete a part of your appraisal or simply refer you to them. Always depends on the client's unique situation.

And speaking of jewelry, I recently interviewed friend and fellow personal property appraiser Tracey Kahle of Kahle Appraisals in Overland Park, Kansas. Her specialty happens to be, guess what? Jewelry! We discussed what appraisers do, how they do it, a few misconceptions regarding jewelry and jewelry appraisals, and how you know you’re getting a worthwhile appraisal product. Read on!

Introduce yourself! Tell us about your background and the kinds of appraisals you conduct.
My name is Tracey Kahle, of Kahle Appraisals. I have 28 years of experience in the jewelry industry. I’m a graduate Gemologist from the Gemological Institute of America and credentialed with the International Society of Appraisers. I provide appraisals for various uses, from insurance to damage claims to equitable distribution of assets, divorce settlement, collateral, estate taxes, charitable donation, and more.


How would you describe what an appraisal is? Are there misconceptions?
It is truly a mystery for most just what an appraiser does. Many think value can be defined immediately even without a thorough inspection or examination, but it’s more complex than that.

Essentially, there are three steps, the first being examination. In this step, I determine the jewelry type, including defining precious metals and gems and authenticate designers or makers. The second step is value research. I examine appropriate marketplaces to determine what values for each piece – an appropriate marketplace being defined as where at item is most commonly sold between a knowledgeable buyer and knowledgeable seller, both in full possession of all relevant facts surrounding the property and both under no compulsion to buy or sell.

Anyway, these marketplaces could be databases, individual vendors, or auction houses, simply depending on the situation. Depending on the intended use of the appraisal, I will search both retail markets, which we consider primary and secondary markets such as auction houses.

Do you find clients confuse an appraisal with an authentication?
Yes, they really do - but appraisals are not authentications at all. While appraisal work is based on readily apparent identity, I won’t conduct an appraisal if I’m not sure about the qualities or composition of an item. If necessary, like when it will have an impact on value, I seek out other experts to authenticate the item before doing the appraisal.

What is USPAP and why do appraisers make a big deal out of it?
I work within the USPAP (Uniform Standards of the Professional Practice) guidelines. USPAP protects the consumer from any type of bias the appraiser may potentially have. USPAP also means that the appraiser is bound to operate without any predetermined result in mind. So essentially, USPAP embodies a higher standard of ethics. As people who buy and sell real estate know, real property appraisers are also bound by USPAP.


Why is it important that an appraiser not work on a contingency basis?
A contingency is against the principles of USPAP, and means one is expecting a certain outcome before any type of research is conducted. Paying an appraiser based the outcome of the appraisal is absolutely unethical, and it’s pretty easy to figure out why.

What is the most common form of appraisal you’re asked to conduct in jewelry?
Insurance coverage, easily. Clients are usually seeking to acquire a scheduled policy for their valuables.


Do insurance companies just accept the appraised value?
I do replacement values for if the insured had a loss. The insurance company can negotiate the level of coverage with the client individually, and they’ll use my appraisal as the bedrock.


How often are a client’s assumptions about their property wrong and how do you correct them?
About half the time. They could believe their jewelry is more or less valuable than the appraised value. More often than not, though, a client has received a piece of paper at the point of purchase with an inflated value. Unfortunately, clients can pay inflated premiums because of that over-inflated value, so you can see where having a professional appraisal done can actually save you money!

Once they figure out the value is inflated, are they ever disappointed?
Many times I’ve been questioned about why the original stated value was so high! My response is based on the simple fact that I cannot speak to the documentation behind that high value, or what it was based upon. But my appraisal work is based on current values, accurate and up to date, researched through industry-recognized marketplaces and databases.


What should one look for in an appraiser – is credentialing important? What sets you apart?
Unlike real estate appraisers, personal property appraisers aren’t required to be licensed. This means anyone, regardless of your level of experience or education can present themselves as an appraiser. But as a professional, I base my credentials on my GIA graduate experience, along with ISA’s appraisal methodology and report writing, and sought credentials through the ISA.

How much education goes into being a credentialed appraiser, affiliated with a professional association?
ISA requires 500 hours of experience in your particular field. They also require recertification every five years. This ensures the appraiser is up to date on necessary requirements and changing laws.


Let’s say I want to become an appraiser. What advice do you have? Where should I start?
The best way to start is to educate yourself in the field you plan to appraise. Get experience in the field buying and selling. Retail can be helpful because it allowed me to first gain experience selling the product. I also spent many years buying on the wholesale level. I have friends and colleagues that work in the auction market that I can rely on for information. After that, I recommend you join a reputable appraisal association that embraces USPAP on top of rigorous report-writing standards. This will inspire confidence in your clients and respect from fellow appraisers!

For more information on appraisals by Tracey or to schedule an appointment, go to www.kahleappraisals.com or call her at (913) 912-9122!

Appraisers Are Your First Line of Defense!

Everyone dreams of being the lucky devil we hear about every so often who picks up a piece of artwork or artifact at a garage sale, and it turns out to be worth a small fortune.

Of course, no one wants to be the seller who turns on Antiques Roadshow a year or so later to see their old item hauled before the show’s appraiser who then gushes over the piece and estimates a value that might have paid off the previous owner’s house.

That’s why I always say, ‘be sure of identity and value – call your appraiser!’ While I often couch this in comic terms, I’m actually very serious.

Many times have I worked for a client whose assumption was that book, those prints, those primitives, those whatever, were garage sale fodder - only to have me come in and identify them as historically significant and highly desirable to the market. In fact, there is no better feeling for an appraiser than saving a client embarrassment and finding them money where they thought there was little or none.

A large portion of the appraisals I’m asked to do are for insurance. The client knows they have nice things and want documentation to protect those items - and themselves - from risk. Very wise.

Of course, things are not always so clear-cut for everyone. Sometimes people inherit items. Sometimes the items have been in the family for years and are assumed to be this or that and have X value, but no one knows for sure.

Be sure of identity and value, call your appraiser!

Recently, in one of the many Facebook collector groups I follow, there was a story about a man who was selling a flag for $200. Happily, the prospective buyer knew it was worth far more and insisted on giving the seller far more so the buyer ‘could sleep at night’ after he resold the item for what he knew was going to be a handsome profit.

Sadly, I don’t recommend counting on finding many people whose belief in honesty and karma outweighs their pursuit of short term gain.

Reputable appraisers - that is to say those affiliated with major appraisal associations like the International Society of Appraisers, should be perfectly willing to help you with value discovery. The process is usually quick and inexpensive. The professional membership and credentialing is vital because it ensures they’re not going sell you an appraisal based on made up numbers you’ll later discover were bogus, just so they can take a few hundred dollars off you and disappear.

And remember, if an appraiser begins talking to you about buying the item directly, excuse yourself from the conversation and contact me so I can direct you to a real appraiser in your area!

Appraisal: Being Sure of Identity and Value

In this new series of blog posts, I’m going to outline basic concepts and terminology used by appraisers that will help you understand the methodology behind the appraisal process.

So, just what is an appraisal?

Someone tells you ‘what something is worth,’ right?

Well, not exactly.

Of course, there’s usually also at least one smarty-pants orbiting the conversation that will spout ‘it’s only worth what someone will give you for it,’ and then ‘har har har’ with an air of unearned self-satisfaction.

Ignore them.

Definition: Appraisal is the act or process of developing an opinion of value, estimating cost, or calculating the present worth of future earnings; a written or oral report documenting same; of or pertaining to appraising and related functions, e.g. appraisal practice, appraisal services.

Pretty simple, eh?

It is. Where it can get complicated is in the application, when we put this process to work for a client’s unique needs – and every appraisal project is different in some way.

It may be in the objective – meaning the client wants to obtain insurance coverage, settle an insurance claim, make a charitable donation for tax purposes, split up personal property equitably (in short: equitable distribution), resale, or simple curiosity. Or it could be in how the properties are being administered during the appraisal process.

Each of these objectives brings its own approaches and parameters. Your appraiser should listen carefully to your needs, decide which form of appraisal will suit your needs best, and explain in great detail how their work is going to address those needs.

The appraiser should also be available after the appraisal is finished to be sure everyone understands the scope and limitations of the appraisal report, and answer any questions you or your authorized agent might have.

Your appraiser should also have a confidentiality clause in their report, meaning they will not share the details of your report with anyone without your written permission, or unless ordered to by a court of law.

For instance, while my website shows many objects I offer appraisals for, none of them have been subject to any appraisal done by myself.

An appraiser should also be honest with you if what you have is within their specialty areas. After all, it’s not possible to know everything about everything. Legitimate appraisers outline their specialty areas clearly and should have a network of other appraisers they can call in to assist in a project that has components outside their competency.

Appraisals should always be USPAP certified. USPAP, or Uniform Standards of the Professional Appraisal Practice, are quality control standards – ethical and performance - for personal property, intangibles, and business valuation appraisal analysis and reports in the United States and its territories. The IRS requires appraisals written for their use to be USPAP-compliant for certain amounts.

Formally educated appraisers that are also members of professional appraisal associations like ISA are required to maintain USPAP compliance in all reports, and keep current with changing rules through continuing education.

Compliance involves an initial two-day 15 hour class (including exam), and a 7-hour update class every two years. Whether or not you need an appraisal that will be reviewed by the IRS, full USPAP compliance along with affiliation with a professional appraisal association are the truest indications of an appraiser’s seriousness and professionalism.

Does it always have to be such a big, costly deal? 

Absolutely not.

Not every appraisal has to be a ponderous, weighty process. Sometimes you may only want to know if what you have has any value before deciding your next step. Your appraiser should be willing to consult with you freely for item identification or value discovery.

Next up: Value Discovery

Appraisers Solve Problems!

You have stuff. Some of it has been given to you by grandma or other family members. Some of it has simply accumulated through the years. Maybe it’s an entire collection of things. You like some of the stuff. Maybe you even like a lot of it. But some of the stuff fills you with inertia. Unfortunately, some of it is a downright annoyance.

You’re pretty sure there’s value in some of it, so there’s one looming question: 

What am I going to do with it?

Sure, you’ll find somewhere to put the stuff you really like, but is it stored correctly and adequately protected by insurance? You’re not absolutely sure? Well, don’t worry -- that’s quite normal.

An appraiser can help you separate the ‘wheat from the chaff,’ and outline options before your next step, based on your unique situation. Whether your ultimate goal ends up being selling, scheduling insurance, making a charitable donation, or something else, your appraiser will be able to provide valuable information that will help you make an informed decision and protect yourself and your heirs from future unknowns – near or far.

Uniform Standards of the Professional Appraisal Practice: Why They're Important

Personal property often requires a formal appraisal in order to obtain insurance, settle a claim, help determine estate tax liability, document a charitable donation, aid in equitable distribution, or just in preparation for resale. Other times you may simply be curious about what you have, its potential value, or just what to do with it. That’s where I come in with a formal or verbal appraisal, or consultation.

More and more people are realizing that their basic homeowner insurance policies are likely not enough to cover their collection of antiques. Other times items are shrouded in mystery, especially inherited pieces thought to have historical significance or special value. Accurate identification or confirmation of value is very important because it almost always determines your next step in protecting your property.

But not all appraisers are equal! You will hear some of us that are part of professional appraisal associations such as the International Society of Appraisers, talk about “Uniform Standards of the Professional Appraisal Practice,” or USPAP.

What are these standards and why are they important to an appraisal?

Think of them as quality control standards for appraising both real estate and personal property. In the United States they are administered by the Congressionally-authorized Appraisal Foundation. The IRS requires appraisals for their use to be USPAP compliant. Appraisers that are members of reputable associations like the ISA are required to maintain USPAP-compliance.

Whether you need a formal or verbal appraisal, or just basic advice, USPAP compliance is the truest indication of an appraiser’s seriousness and professionalism.

If you have an artifact, antique, artwork, rare book, general collectible, or an entire estate – give me a call or send me an email, I’m ready to help!

For more information on USPAP, click here.