We are wanting to engage an appraiser on a transaction in which the appraiser was the broker on the sell of the subject property back in 2005.

Do I have an independence issue?

This is a specialized property and this appraiser is the only one qualified for this market area.

Does the person he sold it to still own it? That could influence his judgment.

IMHO I don't think this person could give you a "non-prejudicial" appraisal but on the other hand he currently has no ties to the property or the transaction so I'm not sure why he wouldn't be independent of the transaction.

Why would you take a chance on an individual appraiser?
Just get a different appraiser and move on.

This is a specialized property and this appraiser is the only one qualified for this market area.

Whether he's the only one qualified or not does not preclude the independence requirements. If there is an independence question then you will have to go outside your market to get someone qualified.

On the surface I really don't see an Independence issue since he is not involved with the property or the loan transaction. But again I don't know him either. Is he the type person that would "inflate" the value due to his involvement 5 years ago?

This is really going to boil down to your comfort level with the appraiser. I would suggest, due to the concerns you have, that you call your examiners and explain the situation and ask for their guidance.

Thanks Dan