If you’re about to buy, donate, inherit, sell or pay taxes on a valuable item of personal property, such as an antique, it’s smart to consult a personal-property appraiser to determine an accurate value of the item in question.
You can bring your item to a personal-property appraiser, who typically charges $150 per hour and requires at least 2 hours for a thorough appraisal. You also can capture high-resolution images of your item and send them to an online personal-property appraiser, which typically charges $9–$45 per item (the higher the amount, the faster the turnaround) and promises an appraisal in as little as 3 hours.
The online option sounds good, right? Not so fast. We spoke with 24 appraisal experts, examined 20 online appraisers and sent images of four family heirlooms to four websites for appraisal. We found that consumers should consider a lot more than just price and the speed of the appraisal when it comes to online personal-property appraisals.
PHOTO LIMITS. Judith Miller, who is a renowned personal-property appraiser and a frequent contributor to the British version of the TV program “Antiques Roadshow,” often tells a story about a friend of hers who hired an online personal-property appraiser to examine a series of photographs to determine the value of an antique plate. The online appraiser concluded that the plate was a 19th-century copy of a 17th-century Delftware plate and was worth about $70. Miller’s friend took the same plate to an appraiser at an auction house, and that appraiser found that the plate actually was an original Delftware plate that commemorated the coronation of King Charles II and was worth almost $204,000. Without that follow-up appraisal, Miller’s friend might have sold the plate for $203,930 less than it was worth.
Miller’s story highlights the problems with online personal-property appraisals. If an appraisal is conducted from photographs (instead of in person), the appraiser’s valuation is limited to what he/she sees in those photographs and the information that the consumer provides about the item. Even the highest resolution digital image compresses important information, such as a hairline crack or a loss of paint, says Jane Jacob, who is the head of New York University’s appraisal-studies program.
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A photograph doesn’t allow an appraiser to use a machine to inspect an item’s composition, as can be necessary with items such as ceramics, fine art, gemstones, tapestries—and 17th-century Delftware plates. A photograph also doesn’t allow an appraiser to look at an item that has electrical or mechanical parts and verify that the item works or to confirm that something is authentic, such as an autograph. Meredith Meuwly, who is the director of appraisal services for Heritage Auctions, which is the largest collectibles auctioneer in the world, tells us that 95 percent of all items must be appraised in person to get an accurate value for an auction. Authenticated and graded collectibles, such as baseball cards and comic books, make up the other 5 percent, Meuwly says.
Still, online appraisals cost far less than the $150 per hour (plus the cost of transportation) that you can expect to pay if you meet with an appraiser in person. The six online appraisers that we interviewed for this article wouldn’t give us a number for how many people use their service, and we didn’t find any independent data that track appraisal usage. However, the six online appraisers tell us that they’re busier now than ever before.
Mike Wilcox, who opened one of the first online appraisers in 1996, tells us that the websites increased in popularity since 2008 because of improvements in digital-camera resolution and the speed with which one now can email a number of high-resolution images. Another factor in the websites’ growth, Wilcox says, is the popularity of TV programs, such as “American Pickers,” which are based on the idea that the stuff that you have sitting around your home might be hidden treasures. When we examined 20 online appraisers, we found that most had some sort of message pitching the idea that your home could contain forgotten relics and that the online appraiser could tell you what they were worth—for a price.
“I have a number of elderly clients,” Wilcox says. “They’re homebound or they can’t get out, so they have their nieces and nephews bring over their cameras and their smartphones, and they can go through their entire home and take incredibly clear video.”
We’re uneasy with the notion of our elderly parents shooting video of their belongings and sending the footage to a website with the hope that an appraiser will tell them that they have a valuable antique. Although no hard data exist, every expert whom we interviewed for this article tells us that it’s common to hear of complaints about unscrupulous online appraisers. These appraisers send back inflated values to encourage consumers to appraise more items or send back lowball estimates and offer to connect consumers with dealers to buy their items. These problems aren’t limited to online appraisers; they also are common with in-person appraisers, our experts say. Unfortunately, the appraisal industry is unregulated, and after a consumer places his/her trust in an appraiser, the consumer doesn’t have any recourse (outside of filing a complaint with an attorney general or an appraisal organization) if something goes wrong, says John Breyault of National Consumers League, which tracks consumer fraud. Most consumers don’t know the value of the items that they’re having appraised, so they don’t even realize that they’re being ripped off, says Ina Steiner, who is the publisher of ECommerceBytes and has written about Internet commerce since 1999.
We decided to take a closer look at online appraisers to judge their thoroughness and trustworthiness. We sent digital images of four family heirlooms of unknown value to four online appraisers. (See “How Did They Fare?”)
One online appraiser told us that our Croatian tablecloth was woven at some point between 1900 and 1910, but another online appraiser told us that it dated from sometime between 1920 and 1950. Another online appraiser said our two lion sculptures were worth between $700 and $900 as a set, but the same online appraiser also admitted that she couldn’t deduce from our images whether our sculptures were made out of bronze or (less expensive) plaster. All of the sites gave us estimates of the fair-market value of our items, but they conceded that they couldn’t guarantee their accuracy. (An in-person appraiser, however, will figure out the accurate value of an item based on what you want to do with the item: divide up an estate, sell at auction, etc.) In short, we ended up with some rough ideas about the possible value of our items but no concrete information. That doesn’t surprise Steiner.
“Online appraisals can be a good starting point for educational purposes, but I wouldn’t say that relying on an online appraisal is a good idea for anybody,” she says.
Richard Johnston, who is the founder of ValueThisNow.com, which uses a network of 106 appraisers, tells us that most of the items that his network appraises are worth $1,500 or less. If you have a high-priced item that demands a close inspection, you’re best-suited to get an in-person appraisal, he says. We didn’t see that caveat posted anywhere on Value
ThisNow.com, and we aren’t certain whether our items are “high priced.”
If you want to use an online appraisal for something more than a starting point in your research, you should be aware that online appraisals won’t hold up in court, with Internal Revenue Service or with most insurance adjusters. On most appraisal websites, you’ll find these caveats mentioned only in the fine print. On other websites, you won’t find any mention of them.
PROBLEMS ARISE. As we said, no mandatory regulations exist for personal-property appraisers, either in person or online. Personal-property appraisers (in person and online) can choose to pay dues and join an appraisal organization to attach to their name as a credential. The three largest organizations—American Society of Appraisers (ASA), Appraiser Association of America (AAA), International Society of Appraisers (ISA)—are the only entities that police the appraisal industry to some degree to ensure that their members provide credible valuations. All three organizations mandate that their appraisers abide by Uniform Standards of Professional Appraisal Practice (USPAP) guidelines, which is a framework of rules for appraisers to follow. If a member violates USPAP guidelines, the organization might revoke his/her credential.
We never put much stock in self-regulation, but, short of regulation, your best bet is to use only an appraiser who belongs to one of these organizations. Unfortunately, only about 25 percent of appraisers join at least one organization, estimates Dave Maloney, who has appraised personal property for 30 years.
If you claim a deduction of more than $5,000 for the donation of related items, such as rare books, on your income-tax form, then you can’t use an online appraiser. IRS mandates that the items be appraised in person by a member of ASA, AAP or ISA.
An online appraisal also won’t hold up in court, which typically requires that the condition, ownership and value of an item is assessed and appraised in person by a USPAP-compliant appraiser, says Ronald D. Spencer, who is an art-law expert. That’s because lawyers typically will look for any way that they can to question an appraisal. If the appraisal wasn’t done in person, then it isn’t considered to be thorough enough to stand up to scrutiny in court, he says.
Most insurance companies require appraisals only for items that are worth more than $5,000, but typically the insurers require that the work be done by an in-person appraiser who is USPAP-compliant, Maloney says. Johnston and Megan Mulrooney of ValueMyStuff.com tell us that major insurance companies in the United States increasingly accept online appraisals, but they couldn’t direct us to any insurance company that has a policy of always accepting online appraisals. (Johnston’s website, ValueThisNow.com, charges a higher fee to appraise an item for insurance: $45 instead of its standard rate of $20.)
Jeanne Salvatore of Insurance Information Institute, which is an industry group, tells us that she hasn’t heard of insurance companies accepting online appraisals. However, she says the insurance adjusters’ requirements vary by company and state. Dennis Jay of Coalition Against Insurance Fraud, tells us that adjusters typically will demand a bill of sale (in addition to any photograph) to serve as proof of ownership. Unfortunately, online appraisers don’t make this clear.
“We don’t want to speak on behalf of every insurance company, but the message that we are delivering to consumers is that items appraised on our site or appraised by electronic means might be acceptable,” Johnston said.
In other words, if you have to appraise an item for insurance, you first should ask your insurance agent what type of appraisal that the insurer accepts. An online appraisal might not be worth the bother.
Dianna Dilworth is a freelance journalist who covers technology and the Internet.