|Sellers, Buyers set Property Values NOT Real Estate Appraisers, Mary Cummins, Los Angeles, California, real estate appraiser, real estate appraisal|
UPDATE: I tweeted my article to Andre Perry. After he made a few ridiculous replies which only showed how much he doesn't know about appraisers and appraising he blocked me. Thank god I just swallowed my sip of iced tea or I would have spit it all over my computer monitor laughing :-D This guy can dish out bad statistics, bullshit and racism but can't take simple facts.
FTR Andre Perry has stated many times that Appraisers are racist and biased. Here are some quotes. He stated this as a fact when it's not. From written testimony from U.S. House of Representatives Committee on Financial Services. "And we’ve witnessed viral news stories revealing how appraisers value Black and white homeowners differently." He's one of the main people spreading those false media articles about alleged bias which I researched and about which I wrote articles.
"We don't want to lay the complete blame on the loss of home values on appraisers," said Perry. "They are certainly an important trigger but the same attitudes that appraisers have, so do [some] lenders, real estate agents and other people in various markets." Many more citations below.
In the intro of his book Andre admits to having anger management issues with people with whom he disagrees. He said he "verbally assaults" people. He stated "My life "which has been beleaguered with unpredictable outbreaks of rage, largely stemming from reminders of past feelings of vulnerability and worthlessness. Minor disagreements with lovers, friends, colleagues, and strangers often turned into blowout arguments, for reasons unknown to them." The intro of his book also shows that his main focus in life seems to be that white people have done him and black people very wrong basically destroying everyone's lives, family and specifically their money. He stated his father died in prison and his mother abandoned him and his brothers with the local baby sitter. It does sound like a tough life that has affected his view of life and others. He stated his goal in life is to show that the main problem in this world is white people. Read the intro to his book and come to his own conclusion. The intro is online and free.
ORIGINAL: Everyone knows the "fair market value (of a house) is the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts." This is the basis of our world economy and free market society. Everyone agrees with this except hate monger Andre Perry who blames lower property values on "racist white appraisers."
Andre Perry just wrote another crazy article about racism and real estate. Someone needs to contact the editor at the Brookings Institute about allowing flawed statistics, misleading research and the promotion of racist hate mongering in their name.
Andre Perry has never let facts and data stand in the way between reality and the racist narrative he's created and actively promotes. He believes everyone in the US is responsible for home values in areas which are mainly "black," i.e. over 50% black per his own criteria, being lower than areas that are mainly "white," i.e. 1% or less "black." He actually only compared a few extremely different areas. This article proves that Perry's paper is based on extremely misleading data selection and biased comparisons which were then used to invent a false and misleading racist narrative. Note that his paper has never been peer reviewed or published in a journal article. It would never pass peer review. A "refereed (peer-reviewed) journal is reviewed by expert reviewers as a quality-control measure." I just checked Perry's resume and he has no peer reviewed articles or papers on his false racism in appraising theory.
In the article Andre Perry wrote "Lower home prices in Black neighborhoods reflect how much we value their residents." Nope. Home prices reflect the price agreed upon by a willing seller and buyer. It has nothing to do with the value of residents. The Appraiser also has nothing to do with the home price or value. A seller could sell his home for $100,000. If the buyer pays cash, there's no appraiser or appraisal. Seller and buyer set the price which is later publicly shared by Zillow, RedFn and MLS. Those sales set the market price for similar homes. Seller and buyer alone control that price and value
Now if the buyer wants a home loan, he'll probably need a real estate appraisal. The purpose of the appraisal is so the bank knows there's enough equity in the home to pay off the loan in case the borrower defaults on the loan. I could appraise that home for $10,000,000,000,000,000,000,000,000,000,000,000,000 and the sale price stays the exact same at $100,000. The home still sells for $100,000. THE APPRAISER AND APPRAISAL DON'T AFFECT THE PRICE OR VALUE! This proves that Andre Perry does not understand the concepts of value, price, real estate, economic principles, basic math...or common sense. His "paper" includes almost every single major statistical error possible. Why does anyone believe this guy or that meaningless paper? It has less merit than an op-ed.
If Perry wants to blame someone for lower home values in some black areas he needs to blame the buyers of those homes which are mainly black per his "research." He should tell those greedy (sarcasm) buyers to pay $1,000,000 for that $100,000 home if they "value their residents." "Don't be a cheap bastard! Pay the seller more than what that home is worth! Do it for the good of the community!" (sarcasm) You sell a few homes for $1,000,000, they're all worth $1,000,000, right? Sadly, no.
FTR I attended the 2019 meeting Perry mentioned in his article. That was the first time I encountered Andre Perry and his lack of real estate, economics or statistics knowledge.
From Perry's article. Notice he speaks about himself in the third person. Who does that? He doesn't even know that the Appraisal Institute is just a private org that doesn't certify or regulate the appraisal profession. I added what is in parenthesis.
"In 2019, one of this blog’s authors (Andre Perry) testified in Congress along with representatives from the Appraisal Institute and the Appraisal Foundation, two organizations that help certify and regulate appraisal professionals. When Rep. Al Green of Texas asked the panel to raise our hand if we believe “discrimination plays a role in the devaluation of property in neighborhoods that are predominated with minorities,” I was the only one who raised a hand."
I decided to go find this video to refresh my memory as I was working while listening, watching the original hearing. Andre Perry is a liar. See the video below. The guy directly behind him also raised his hand so 2/26 people. He was not the only one. Perry also lied about the question. This is the real question, "Do you believe that invidious discrimination, invidious is harmful, (full definition: Treating a class of persons unequally in a manner that is malicious, hostile, or damaging; unfairly, unjustly discriminating) plays a role in the devaluation of property in neighborhoods that are predominated with minorities but more specifically black people? If you do believe this, raise your hand. If you think black people are being discriminated when their property is being appraised, would you kindly raise your hand." Andre Perry raised his hand. This shows he is specifically talking about appraisers appraising properties and not AVMs here. AVMs are not appraisals. This is why Appraisers are upset. He accused us of invidious discrimination besides bringing up and widely sharing anecdotal media articles about alleged discrimination by appraisers.
All the real estate experts with many years of experience and multiple degrees in real estate did not and do not agree with Andre Perry. This shows that Perry does not know what he's talking about. I also would not have raised my hand. The property in question is not, was not devalued. There is no discrimination in property valuation because it's based on a math formula. Most Appraisers never see the buyer, seller or know their race. It's just an address to us. The robot appraisals don't see anyone or anything, not even the property. Andre Perry's paper is based on robot appraisals and prices agreed upon by sellers and buyers. Appraisers had nothing to do with the data he used. I'm not saying racism doesn't exist. It does. It's just not an influence in real estate appraisal especially robot real estate valuations like Zillow.
Perry states that homes in black areas are worth $48,000 less than in "similar" white areas. Then what explains the differences among the values in white areas? It can't be discrimination against black people because they're white. Same thing happens in brown areas. What explains the lower value of a white owned home in a black area? Again, the owner is white and not black. Will all the white and brown people with lower home valued be compensated by any new government initiatives or reparations for low valued homes? Perry has been talking about using his $48,000 figure as a measure of reparations for black people. What about the rest of us suffering from low priced homes? I don't even own a home. Will all people who don't own homes, even homeless people also be getting a check?
In the article Perry talks about the Indiana and Florida media articles about alleged racism in real estate appraisals. Recently he said those were just media articles and we don't know if it was racism or not. He even said recently he's never said appraisers were racist and he doesn't feel they are. Now he's back to promoting the idea of racist appraisers again! This guy will say whatever the audience in front of him wants to hear. He doesn't even know his own truth. He's that insecure.
His recent article is about the "Brookings and Ashoka Collaborative Innovation Challenge." They're offering money which he will most likely reward to a like minded friend who promotes his racism. Stuart Yasgur the VP & Global Leadership Group Member represents Ashoka #stuartyasgur . The prize is supposed to go to the person who solves the problem of homes in specific black areas being worth less than homes in specific white areas. I may send in a solution to the problem. My solution is that the problem as defined by Andre Perry doesn't exist. He created it. I solved it. Poof, it's gone. Where's my check?
#andreperryedu #stuartyasgur #brookingsinstitute #ashoka #racism #hatemonger #marycummins #realestateappraiser #realestateappraisal #brookings #race #bias #appraisal
Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.
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