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Brian Seibert, president of Watson Group Financial in Waterford, said that Fannie Mae and Freddie Mac requirements that comparable sales from the past 90 days be used are making local home values decline even more.

For example, if you are trying to sell a lakefront home in March, there are likely not many comparable sales.

“That’s why sometimes inferior comparables are used,” he said.

Appraisers can use comps older than 90 days, but they must provide a full explanation of why that was done, Edgar said.

Norman G. Thomas, president of R.S. Thomas Associates in Livonia, sits on the state appraisers licensing board and said lenders are looking for more detailed reports on properties.

“Yeah, we are taking the heat,” Thomas said. “But we are required to answer the questions and fulfill the requirements of the people lending money.”

The oversupply of homes on the market and weak demand have kept home prices from rising, he said, not appraisals.

Groups fight back

Realtor and home builder associations say they’ve worked with the government to ensure that appraisers can be asked to consider additional information.

Jerry Nagy, senior regulatory policy representative for the National Association of Realtors, said when the Home Valuation Code of Conduct was first rolled out, there was confusion about some guidelines.

Although the code was set up as a firewall between appraisers and those with a vested interest in the real estate deal, “people took that to mean that nobody could communicate,” Nagy said.

With Dodd-Frank, that concern has been addressed, Nagy said.

The Realtors association supports Dodd-Frank. In a statement, the National Association of Home Builders also said it supports the new guidelines that make it clear that appraisers can be asked to consider additional information about a property, including data on additional comparable properties.

The issue with appraisals also creates hiccups if the number comes back too high, particularly in short-sale transactions. Janet Graham, a Birmingham Realtor, said two different appraisers overvalued a home she was trying to sell.