Less than three months after new rules for home appraisers kicked in, the real estate industry is in uproar.

Realtors, homebuilders, mortgage brokers and the appraisal industry all agree the rules are causing problems. Some are backing a bill in Congress to kill them.

The new guidelines essentially put a firewall between lenders and home appraisers. They also ended the practice of lenders using in-house staff for initial home appraisals and prohibit the use of appraisal-management companies owned or controlled by lenders.

Since they went into effect May 1, the rules have created a slew of unintended consequences that critics say are causing delays in closing sales, or undermining sales because botched appraisals are coming in too low.

"This thing is not only preventing the housing market from recovering, it's destroying the housing market," said Marc Savitt, president of the National Association of Mortgage Brokers. "We're eliminating competition, and we all know what happens when you eliminate competition: Prices go up."

Suzanne Wilhelm, who has been trying to sell her home in Henderson, Nev., for six months, blames an appraisal done under the new rules for scuttling what had been a done deal with a buyer several weeks ago.

The appraisal valued her four-bedroom, 2,000 square-foot house at $190,000 - $45,000 less than the price the buyer agreed to pay. Wilhelm, who paid $187,000 for the house in 2001, thinks the appraiser based his estimate on the sale of several foreclosed homes in the area but ignored sales of regular homes that would have reflected a higher price.

"It's very unfair that we're put into the same bracket as those people who were so irresponsible in buying their homes," said Wilhelm, a teacher.

The rules, dubbed the Home Valuation Code of Conduct, are meant to eliminate conflicts of interest that created pressure on real estate appraisers to inflate the value of a property. Lenders, agents and brokers have been known to pressure appraisers to "hit the number" that the homebuyer and seller agreed on so the deal would close and everyone could collect their fees. Inflated appraisals were partly blamed for fueling the housing bubble.

Under a settlement last year with New York Attorney General Andrew Cuomo, however, Fannie Mae and Freddie Mac agreed to buy only loans from lenders that don't directly hire appraisers. The move sent shock waves through the industry because Fannie Mae and Freddie Mac own or guarantee about half of all U.S. home loans.

So lenders started giving more business to appraisal management companies, which critics say draw appraisers from a pool of candidates willing to do the job for less money and who, in some cases, may be unfamiliar with a neighborhood.