Washington Report

Advocacy Updates from Washington D.C.

Agencies Increase Commercial Appraisal Threshold

On April 2, 2018, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Board of Governors of the Federal Reserve System (collectively the Federal Banking Agencies) issued a final rule increasing the appraisal threshold for commercial real estate Federally Related Transactions from $250,000 to $500,000, $100,000 more than the increase in the 2017 proposed rule.

NAR previously sent a comment to the Federal Banking Agencies supporting the proposed increase to the appraisal threshold for commercial real estate Federally Related Transactions from $250,000 to $400,000. NAR stated, and the Federal Banking Agencies agreed, that the increase would account for the rise of inflation since the $250,000 threshold was set in 1994 without adversely affecting the safety and soundness of the commercial real estate industry. Commercial transactions that do not meet the new $500,000 threshold must still obtain an evaluation of the real property that is consistent with safe and sound banking practices.

Final Commercial Appraisal Rule 

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