Mary Cummins, Real Estate Appraiser, Animal Advocates, Los Angeles, California

Mary Cummins, Real Estate Appraiser, Animal Advocates, Los Angeles, California
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Showing posts with label racism. Show all posts
Showing posts with label racism. Show all posts

Thursday, August 3, 2023

AEI Response to PAVE Task Force AVM. Appraisers Are Not Racists and Don't Lowball Blacks, Latinos, comments by Mary Cummins

UPDATE 11/03/2023AEI proves once again that HUD, US Government lied about appraisers allegedly low-balling people of color. This is exactly what appraisers have been saying all along. "We find that seemingly large differences in the share of under-valuations–appraisals where the appraised value is below the contract price– received by people of color are almost entirely or entirely due to differences in geographies where people, regardless of race or ethnicity, reside. When comparing appraisals for people of color to those for non-Hispanic white people within the same census tract, we find that there are no or minimal differences.

This analysis suggests that commonalities in people’s experiences in buying a home (e.g. first-time home buyer status) or local market conditions (e.g. the presence of a market frenzy or seller concessions) are far more important than differences in people’s race or ethnicity when it comes to determining who receives an under-valuation and who does not. This suggests that studies by FHFA, Brookings, or Freddie Mac with their singular focus on appraiser racial bias have misdiagnosed the issue." #AEI #americanenterpriseinstitute #marycummins #realestateappraiser #realestateappraisal #HUD https://www.aei.org/research-products/report/confirming-alternative-explanations-for-appraisal-under-valuations-new-evidence-from-appraisal-level-data/

ORIGINAL: American Enterprise Institute (AEI) made some important independently researched statements in their comment letter about the PAVE Task Force, AVMs and real estate appraisers. It shows with verified facts the flaws in the research cited by PAVE. The research cited by PAVE was poorly done by the Urban Institute, Andre Perry then twisted to meet the agenda of UI, Perry. I have no issues with promoting the interests of black people. I'm Latino and promote the interests of Latinos, Blacks, Asians, women, lower income, homeless... I do have a problem with people falsifying research to promote an agenda with racist lies which hurt innocent people. Below are a few important issues raised in AEI's comment letter to the PAVE Task Force.

1. AEI stated First Time Buyers (FTBs) tend to overpay for properties. There are also more seller concessions. This would explain appraisals being at market value which is lower than contract price. I see this all the time because I appraise in these areas. It's not the result of biased, racist appraisers.

Urban Institute, HUD, PAVE stated that "racist old white male" appraisers were intentionally low balling blacks and Latinos. Their "proof" was a difference in contract price and appraisal values in census tract areas with more Blacks, Latinos. I'd commented at the time it was probably because there is a correlation between race and income. Whites make more money than blacks, Latinos. People who make more money have more money and buy more expensive homes in more expensive areas. Areas which are predominantly black, Latino are lower income areas with many first time buyers. 

"The presence of first-time homebuyers (FTBs) or the use of seller concessions could affect the sale price relative to the AVM. Our analysis in “Exploring Alternative Explanations for Appraisal UnderValuation” shows a significantly higher share of FTBs in tracts with lower levels of non-Hispanic White residents. This is significant because the literature shows that FTBs tend to overbid for a home by approximately $3,000, or about 1% of the contract price for the average home compared to repeat buyers and that they use a higher share of seller concessions, which can amount to 2.01-3% of the property price."

2. The letter noted that homes in lower priced areas that are more likely to be predominantly black, Latino are generally in lower rated condition which would be C4, C5 rating as opposed to C3 and above. I see this every day in my inspections of these areas. Again, it has to do with money. The more money you have, the more you will spend to properly maintain and upgrade your home.

"Even though the paper controls for home quality as measured by an exterior condition rating, we found in other work that exterior condition ratings can be quite different from interior condition ones. We also found that home interior quality can be a significant factor in the difference between an AVM and a home’s sale price and that for a small number of properties with extreme conditions that difference was significant."

3. The letter also again stated that AEI found no effect of race on appraisal value

"We have pointed out serious flaws in numerous studies that purport to show widespread appraiser bias or systemic devaluations of neighborhoods." https://www.aei.org/research-products/report/exploring-alternative-explanations-for-appraisal-under-valuation/

They suggest "To better measure and document appraiser racial bias, we once again propose reviewing every appraiser for racial bias and deliberate inaccuracies based on a comprehensive review of their past refinance appraisals. To that end, we have demonstrated a working methodology in “A Blueprint for Mass Screening Appraisers for Racial Bias and Inaccuracy Based on an Atlanta, GA Study” that could be implemented today by either FHFA, Fannie Mae, or Freddie Mac.Ultimately, the goal of public policy should be to identify biased and inaccurate appraisers and to prosecute the former and to educate and retrain the latter."

I fully support this. Please, fairly audit everyone's appraisals. I'd be the first to take racist appraisers out behind the woodshed. Take away their license, charge them with actual crimes and send them to prison. Stop blaming every appraiser for racism and bias. What really irks me is that these people are claiming racism and bias when they are doing exactly that to real estate appraisers. If you're against racism, bias, you should be against ALL racism or bias against everyone or else you're a hypocrite.

https://www.aei.org/research-products/report/a-response-to-the-recommendations-of-the-pave-working-group/

https://www.aei.org/wp-content/uploads/2023/08/A-Response-to-the-Recommendations-of-the-PAVE-Working-Group-FINAL-1.pdf?x91208


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.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin

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Wednesday, April 12, 2023

Andre Perry falsely states grocery stores are racist. More bad "research," by Mary Cummins


Andre Perry just released more false and misleading "research." Andre Perry believes that premium grocery stores are racist against black people. He "proves" his point by showing there aren't many premium grocery stores in predominantly black areas. Again, his "research" is bad science and misinterpreted results. People on the internet are using his "data" to attack grocery stores and rile up black people against whites. This is not peer reviewed or published research. Below is his linked article. 

https://www.brookings.edu/research/what-the-lack-of-premium-grocery-stores-says-about-disinvestment-in-black-neighborhoods/

Andre Perry states there are few premium grocery stores in mainly black areas. This is correlation and not causation. There are also few Louis Vuitton stores and Rolls Royce dealerships in predominantly black areas for the same reason. The reason is financial. There is research which proves whites make more money than blacks and Latinos in general. If a store chooses its location based on higher income, that area will more likely be more white than black, Latino. It's correlation and the income gap, stupid.

Premium grocery stores are in the business of making money. They want to make as much net profits as possible. They do this by locating their stores in an area which has the highest concentration of their most likely customers with the least amount of risk. They don't consider race. Below is an article about how Whole Foods chooses store locations to prove this. https://www.washingtonian.com/2015/07/14/how-whole-foods-decides-if-your-neighborhood-is-worthy/#:~:text=Whole%20Foods%20doesn't%20divulge,estate%2C%20population%20density%2C%20education%2C

From the article, "Whole Foods doesn’t divulge specifics about its real-estate decision-making, which it considers “proprietary.” Mid-Atlantic regional president Scott Allshouse at least offers this via e-mail:“We take a variety of factors into consideration, including availability and cost of real estate, population density, education, demographics, and the community’s interest in natural and organic foods. No one factor is most important.” Later in the article it states main factor is "education then commuter patterns, checking out competing grocery stores, and calculating their likely earnings."

Here's info on Trader Joe's locations. They tend to choose locations "located in cheaper parts of expensive areas." "The company is selective about new markets, taking a gander at median household income, education, population density, distribution efficiencies and labor force." " Stern and David Livingston, an expert in supermarket location research, said Trader Joe’s typically looks for median household income in excess of $100,000. The perfect storm, Livingston said, is high incomes and expensive homes within the first 2 miles of the potential site, with maybe a major university or large medical complex sprinkled on top." “They are not going to open a store based on a petition because everyone wants a Trader Joe’s,” Livingston said. “But only people who are educated and have high disposable incomes will actually support one.”

Grocery stores are not a government service or a nonprofit. They don't have to invest in poorer areas. They are a business. They don't care about race. They do care about safely making net profits. If an area has lots of potential clients but has high crime, theft, vandalism, they probably wouldn't choose it because net profits would be reduced by crime. Some shoppers might not even want to shop in a high crime area because they don't want to get mugged, robbed, car broken into, raped or killed. A good example of this is Whole Foods markets closing in a prime area of San Francisco. https://kesq.com/money/cnn-business-consumer/2023/04/11/whole-foods-closes-san-francisco-flagship-store-after-one-year-citing-crime-2/#:~:text=An%20enormous%20Whole%20Foods%20in,over%20the%20past%20six%20years. 

Instead of calling Whole Foods a racist piece of shit the County Supervisor said this about the closure. "San Francisco Board of Supervisors member Matt Dorsey said on Twitter that he was “incredibly disappointed” by the closure. “Our neighborhood waited a long time for this supermarket, but we’re also well aware of problems they’ve experienced with drug-related retail theft, adjacent drug markets, and the many safety issues related to them,” Dorsey wrote. Appearing on “CNN This Morning” Wednesday, Dorsey said he’s “seen a lot of issues of people acting out and shoplifting” at the store. “Fingers crossed we can turn things around here and I do have some optimism, but hopefully we can get this supermarket back open,” he said." Reducing crime in the area is the solution here not calling people racists. If you call Whole Foods racists, they may never want to open a store in that market area.

Per research there is a correlation between income, age, class, gender, race and increased street crime, see link below. Lower income, 15-24 age group, lower class, males, black then Latino commit most street crime per research. Lower income areas tend to have more 15-24 year olds, lower class, males, blacks and Latinos which commit more crime. More correlation. Increased crime levels is another reason why Trader Joe's would not want a store in a lower income area. Crime reduces sales, adds costs and eats into profits. https://open.lib.umn.edu/socialproblems/chapter/8-3-who-commits-crime/

Andre Perry's article looks at premium markets. Premium markets like Trader Joe's sell specialty items, organic food and higher priced items. It makes sense to be located in an area where people make more money. If you don't have a lot of money and went to Trader Joe's, you wouldn't be able to afford to buy as much food. You'd rather shop at the 99 cent store where I shop or Dollar General. There is plenty of good, healthy, affordable food at the 99 cent store. I buy beans, rice, fresh fruits, fresh vegetables at the 99 cent store at a better price than Ralphs, Trader Joe's and Whole Foods. I'd be pissed if I didn't have a 99 cent store not a Trader Joe's. Only uppity people like Andre Perry would demand a Trader Joe's. If you want to shop at Trader Joe's to buy $11 lavender flavored organic nuts, just go to one. If you can't travel, the 99 cent store is fine to buy regular nuts. People don't need specialty grocery stores. They just need to buy good affordable food. Next Perry will be whining that there's no Gucci store in low income areas.

I'm Latino and live in a predominantly Latino area because it's a poorer area in Los Angeles. We have a 99 cent store and a Ralphs. I eat good, healthy, cheap food and am happy. I don't want or need an expensive Whole Foods or Trader Joe's store. Maybe I should be like Andre Perry and yell that markets are racist against Latinos because I personally don't get what I want. Perry seems to always forget that his predominantly black areas (10% or more black) also have 90% poor Latinos, whites and others. He only cares about black people because he has a personal agenda. I read most of his book "Know your price" and he basically admits that he's racist against white people. He blames every problem on white people.

Maybe I should lie and state that all companies that don't cater to poor Latino me are racists against Latinos. I'd probably get a good following of poor angry Latinos who think all their problems are caused by others. I bet I could write a book about Latino hate and make money writing hate books, giving hate speeches and spewing racist lies to further divide our country just like Andre Perry. I would never do that because that would be dishonest and racist. Andre Perry is doing it because of his racism and he likes the money and false accolades. He needs to make more money so he can shop at more expensive Trader Joe's.

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.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Monday, February 20, 2023

Rebuttal to Marcia Fudge's Misleading 2022 CNN Interview by Mary Cummins Real Estate Appraiser

Marica Fudge, HUD, Laura Coates, CNN, interview,Mary Cummins real estate appraiser, bias, discrimination, racism,white, black, Latino, home value, 


Marcia Fudge of the Housing and Urban Development Department (HUD) was on CNN August 22, 2022 with Laura Coates discussing alleged appraisal bias. "Housing and Urban Development Sec. Marcia Fudge says her department is examining the process in which home appraisers collect data, which she says is systemically biased against people of color." "HUD Secretary On Battle Against Racism In Real Estate."

Here is a link to the show:   https://www.cnn.com/videos/business/2022/08/22/hud-sec-fudge-racism-in-home-appraisal-process-coates-intv-ctn-vpx.cnn

Here is a link to the transcript: https://transcripts.cnn.com/show/se/date/2022-08-22/segment/01

Marcia Fudge continues to promote the false narrative of the alleged "racist appraiser" "devaluing black owned homes." Marcia Fudge has the facts and independent research yet actively intentionally promotes the false narrative to promote her own agenda. Fudge's agenda is to get media attention for herself and more money for her department. Fudge and politicians have created this problem so they can state they alone can fix it. In fact based on what Fudge said in the interview the problem has already been fixed just by doing the same thing they've done for years.

The real issue is the income gap. White owned homes are valued more than black, Latino owned homes because of the income gap. Whites make more money than blacks, Latinos. The more money you make, the more money you have. The more money you have, the more expensive home you can buy and own. The more expensive home you have, the more generational wealth is created.  If you want to fix the home value gap, fix the income gap. Fudge won't admit to that because then the problem is not in the jurisdiction of her department HUD and she won't get more money.

Below are some very misleading quotes by Marcia Fudge.

"Because what we know is that it used to be that these things happen only in redlined
communities. But now it is pervasive, it is happening everywhere. And we determined that part of the problem was how appraisers are trained, who was in the appraisal industry, and how they are governed. And so, what we did, in March, was to present a report that showed how deeply, this whole bias situation, is across this country. It is systemic, and it is intentional to some degree."

Marcia Fudge doesn't understand redlining. Here's an article I wrote about it. Those risk maps were made by her own government agency HUD FHA and no longer exist. Government made risk maps were a way to determine loan risk. They included many factors. We still use all of these factors except we don't use race or country of origin. If you took race and country of origin out of the old maps, they were 100% as effective in determining risk. Obviously race and nation of origin have nothing to do with loan risk. Correlation is not causation. Not all maps even included those factors. 

"That's part of the problem, Laura, it's the data. So, they collect data, and the data is not what it should be. They then use the data, in a way that it should not be used. And so, they come up with these biased appraisals. But as well, when you look at an industry, that is more than 95 percent White, you find that people of color, are treated differently, because there is an inherent bias with a lot of them. And because they collect the data, the data is not good data."

Appraisers don't collect data. The data is home sale prices. It's just data. HUD collects this data. Zillow has and uses the same data. MLS, Title collect data. Appraisers use the public data according to the law and well established, accepted economic theory. HUD is one of the government agencies which told appraisers what data to use and how to use it. Appraisers are doing what HUD told us to do.

95% of all appraisers aren't white. I've gone over the misleading statistics in previous articles. Almost the same amount of appraisers are white as real estate agents. If most agents are white, does that mean they are also all racists? Most people in the US are white. Does that mean every white person is racist? Of course not. 

"If those homes are appraised the way that they should be Laura, then we look at being able to pass down, significantly, more resources, and more wealth, to generations that follow." "And if we are
constantly being discriminated against - and that is really what this is. We can call it bias, if you want. But it is systemic racism, and it is built within most federal agencies, and those agencies that we oversee." 

This is the result of the income gap and not appraisers. Here is AEI's response to the PAVE Task Force. Fudge knows this. She has the facts, data and research. If she truly believes this, she should be fired because she's incompetent. Fudge is just lying to the public. 

"So, we're tackling it. We are now advising first-time homebuyers, on their rights, if they get low appraisals. We are doing it to people, who sell properties. We are going to train all of the appraisers through fair housing and lending laws. We're going to make sure that the data is collected properly. And we're going to make sure that the right people have the data."

Fudge's solution is to do what we've already been doing for years. Fudge created a "horrible" problem then instantly fixed it by doing nothing. All these things have already been done years before she was the head of HUD. This proves she knows the problem doesn't really exist. She hasn't made any real changes and now it's "fixed."

Marcia Fudge stated that her own home is worth less than white owned homes down the street because she is black. This is of course false. I did a valuation of her much older home on a busy highway. It's worth less than the homes up the street because they are new luxury homes off of the highway. If Fudge doesn't understand this, she doesn't understand the basics of home appraisal and should resign as head of HUD. She states this falsehood for effect every time she speaks. 

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 40 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Monday, January 9, 2023

Cancel Culture is Destroying Freedom of Speech on Important Issues by Mary Cummins Real Estate Appraiser

mary cummins, real estate appraiser, appraiser, appraisal, real estate,real estate appraisal, los angeles, california, racism, cancel culture, bias, black, white, freedom of speech
mary cummins, real estate appraiser, appraiser, appraisal, real estate,real estate appraisal, los angeles, california, racism, cancel culture, bias, black, white, freedom of speech


If someone does something racist, they should be called out and educated. If a police officer murders a black man, they should be arrested and tried in a court of law. If someone just talks about these issues, they shouldn't be attacked, sued, have their business ruined, reputation destroyed, be harassed, threatened and assaulted. It doesn't make any sense. It harms freedom of speech, promotes racism and destroys any chance at public discourse of the issues.

Lizzo took a moment on a Sunday morning to share her concerns about cancel culture.“This may be a random time to say this but it’s on my heart.. cancel culture is appropriation,” Lizzo tweeted on Sunday (Jan. 8).“There was real outrage from truly marginalized people and now it’s become trendy, misused and misdirected,” she wrote. Lizzo continued: “I hope we can phase out of this & focus our outrage on the real problems.”

People are more upset about people talking about racist issues than the actual racism, race violence and hate crimes. People are more upset about someone stating facts about the false narrative of the racist appraiser than they are about real racism against blacks, the wealth gap or the fact that blacks, Latinos have little generational wealth. We appraisers can't even talk about the issue without being attacked, harassed on social media, getting false negative business reviews, death threats or threats of physical harm. Appraisers can't even comment on articles about the false narrative of the "racist appraiser" or we'll be viciously attacked. In fact some appraisers, AMCs and lenders have piled on to the false narrative in order to garner praise, seem woke, appear to be doing something about racism, get business, positive press and to not be attacked over the same issues. Some lenders have even used this issue to rip off POC by luring them in with promises of no racism only to charge them higher rates which is racist.

The real issue here is the income and related wealth gap between whites and POC. Because POC make less money, they have less money and wealth including generational wealth. Because they have less money and wealth, they buy and own less expensive homes in less expensive areas. The cause of the difference in value between white and black, brown owned homes is not the fault of the real estate appraiser. The data used in these misleading articles didn't even come from appraisers or appraisals but flawed automated valuation methods, robots, software programs by failed Zillow. The real problem is the income gap. Tell politicians and the government to fix the income gap. Assaulting real estate appraisers will never fix the problem.

Someone on Twitter stated in response to Lizzo's tweet, "Jessica Ballinger @BallingerMom Replying to @lizzo

Absolutely ❤️ There are very real issues that warrant outrage… I sometimes wonder if cancel culture stems from people feeling impotent against those bigger issues, so they go after simpler targets to feel better about themselves, like they did something."

I can understand the feeling of wanting to do something about racism but harming an innocent bystander is wrong. If someone sees racism against POC by white people, that doesn't give them the right to beat up and kill any white skinned person they see. That's just as racist as the racism they say they hate. It's also hypocritical.

In this situation by forcing real estate appraisers to shut up about the false "racist appraiser" narrative they are destroying freedom of speech and any public discourse on the issue. Instead the public only sees the misleading articles about specific cases in the media which are false. The media now writes these articles to get more outrage, traffic to sell more ads. One media will share the article by another media to make money off ads. 

I've written about some of those cases here. The homeowners weren't low balled due to the fact they were black and the appraiser was white. The homeowners weren't even low balled in the specific cases I reviewed here. The specific properties were appraised using the closest most similar sold comparables. They were all near the edges of more valuable but very different neighborhoods. They were worth less than homes in the next neighborhood for very good reasons. The homeowners just wanted their homes to be worth more and were maybe misled by Zillow, RedFn and other robot "Zestimates."

I really hope in 2023 appraisers will be allowed to write articles about these issues or at least comment on articles without being so viciously attacked that they have to delete their comments or only comment anonymously. That doesn't help anyone. It just perpetuates racism and hatred against white appraisers.


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.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Monday, May 2, 2022

Appraisal Foundation Appoints Jillian White to Board of Trustees in Political Move, by Mary Cummins

April 30, 2022 The Appraisal Foundation (TAF) appointed Jillian White, Shelly Tanaka and Meredith Meauwly to the Board of Trustees. They also welcomed back the Appraisal Institute as a sponsor. 

TAF is authorized by Congress as the source of appraiser standards and appraiser qualifications. TAF had been taking a lot of political heat recently because their Board lacks diversity because it's mainly older white men. While I applaud TAF for starting to diversify their Board I personally feel one of these appointments was in response to political pressure. That one appointment is Jillian White.

White is an ex appraiser who was recently named the "Head of Better+" March 2022 per her LinkedIn announcement. Better+ is Better's affiliate businesses of Better Mortgage. Better has been in the news for mass firings, lawsuits and major financial problems. Better Mortgage will most likely soon be out of business as the mortgage market shrinks as a result of the rise in interest rates and overall failure by Better's CEO Vishal Garg. 

Jillian White was a real estate appraiser and real estate agent. "In 2016, Ms. White joined Better, a digital mortgage provider, as the Chief Valuation Officer." "In 2018, she was named the Head of Collateral." During Jillian White's time at Better she has been promoting the false narrative of the "racist white appraiser." She has done this by quoting false and misleading data. Jillian White has cited debunked Andre Perry's paper and Freddie Mac's note repeatedly. Andre Perry's paper was not published or peer reviewed research. It has since been proven to be false and misleading by very well known researchers at American Enterprise Institute (AEI).  AEI also debunked the Freddie Mac note. Tobias Peter was invited by the government to speak at the recent House Committee of Financial Services about this issue and this misleading data.

Promoting the false "racist white appraiser" narrative promotes racism and hatred of others. White an Appraisal Institute appraiser is stoking the flames of hate and racism toward appraisers, white people and the industry as a whole. The Appraisal Institute AI recently stated they would enforce a zero tolerance of racism and hate speech among their members because of hateful racist behavior by appraiser Dave LaVigne. White has promoted the false "racist white appraiser" narrative through her many presentations and articles about blacks "being forced to" "white wash" their homes. Here are a few of those articles, "Why some homeowners of color erase themselves," "Black appraisers call out racial bias," and "Better Website: Keep an eye out for personal bias." 

White went so far as to state “In the case of my family, our home was forever changed after that. A lot of the pictures never made it back on the wall." Who forced them not to return the pictures after the sale or appraisal? Every real estate agent knows and tells ALL of their clients REGARDLESS OF COLOR OR RACE to remove personal photos and items from their home when they sell their home to INCREASE THE SALES PRICE. It has nothing to do with race, color, religion... I did this when I sold my own home and I'm not black. As an agent I suggested all clients do the same.

Below is a still from one of her many public presentations where she points out the family photos, heirlooms and certificates she was "forced" to remove because of "racist white appraisers." This wasn't even for an appraisal but a basic home showing and sale of relatives' homes.  


Jillian White stated in the Better website, "96.5% of all real estate appraisers are white." This is not accurate though it's true most appraisers are white just like real estate agents. "Oddly" people aren't complaining about the lack of diverse real estate agents. Even the general population of the US is over 76% white. People are actually complaining about appraisal gap which is more likely in a quickly appreciating market. They're falsely claiming the cause of appraisal gap is racism because of the change in political climate caused by the murder of George Floyd. 

"The country is in a time of racial reckoning, heightened by a summer of protests against systemic racism and police brutality following the death of George Floyd in police custody." Floyd's death "sparked the largest racial justice protests in the United States since the Civil Rights Movement." "According to data from various sources, the Black Lives Matter movement is now the largest movement in US history." While racism exists and must be banished from our nation the pendulum has now swung to the extreme side. In this new light anything and everything is automatically "racist" today before even looking at the facts. Every appraisal gap is now "racism."

American Enterprise Institute AEI actually did research to see if racial bias affects real estate appraisal values. Their conclusion was NO, it's not common or systemic. 99% of the time we appraisers don't know the race, color, sex, religion of the owners of the properties we appraise and use as comparative sales. 

Jillian White even stated to the media that racist white appraisers are the reason there are few black real estate appraisers. White states white appraisers refuse to have black trainees because they're racist. The actual problem is the trainee process and not "racist white appraisers." Appraisers don't want trainees of any color because they have nothing to gain and everything to lose. Hypocritical Jillian White doesn't even have trainees of any color. 

White stated “This idea that we’re (real estate appraisers) just strictly reporting on the facts, that isn’t true, because if that were true you wouldn’t need appraisers." This shows that White either doesn't understand real estate appraising or she's lying to the public for her own agenda. All Appraisers know Automated Valuation Methods AVMs (robots, algorithms) can't and don't accurately appraise real estate. AVMs don't see views, specific location, upgrades, condition, elevation, lot type... All these facts must be viewed and appraised by a human real estate appraiser. We don't currently have exact view, lot type, degree of remodel ... UAD codes to input into the form. The human appraisers see and report the facts such as type and degree of view, condition, upgrades... Should White even be a real estate appraiser if she doesn't understand the basics of appraising? Should White with these racist ideas, clear discrimination and bias be a real estate appraiser? If a white appraiser were to state these same things but about black, Latino appraisers, they'd instantly be cancelled. In fact AI stated they want to take action against racist appraiser Dave LaVigne because of racist language. Perhaps they should take action against White. White has stated these racist things in her professional capacity. 

Jillian White was a real estate appraiser and agent just like me. We are numbers, math and statistics people. White knows these things she stated are false yet she promotes them for Better mortgage as a form of "diversity" marketing and exposure in the media. That appears to be her real job at the company as she mainly attends meetings to promote these falsities to the public and government agencies. Now that Better is soon going out of business White continues to promote this false narrative at government meetings and presentations to promote herself for a future job after Better goes out of business.

The purpose of promoting the false "racist white appraiser" narrative was to promote Better as "diverse and non-racist." Better had promised to train, hire and use diverse appraisers but they have not done this. This was in fact Jillian White's original job at which she failed. Instead Better fired 900 people December 2021. 2022 they fired 3,000 more. Currently they're asking people to just plain quit.

Better began failing during a huge run up in refinances. Any idiot company could have been successful during this time yet Better was failing last year. March 8, 2022 Better fired 3,000 more people. The CEO of Better's main goal is to go public and cash out. That appears to be his MO based on his last finance company myrichuncle which went bankrupt. 

There is a saying in large companies. When they appoint a lawyer or lower level employee as the head of the company or of a major department it's going out of business. The person was hired to ride the company into bankruptcy. High ranking employees have already been fleeing the company in 2019 and it's increased recently. Considering that Vishal Garg's last finance company went bankrupt then was sued for fraud by investors that appears to be the future of Better. 

White's main recent activity has been speaking at government meetings about "racist white appraisers." She has been the face of discrimination in real estate appraisals in the media. While she has an appraiser's license this is most likely the reason she was appointed to the TAF Board. TAF has given into political pressure to appoint this specific person. By doing so TAF is basically supporting the false narrative of the "racist white appraiser" which is beyond disappointing. I personally feel TAF is doing this just to quiet pressure from Maxine Waters and others who are calling for the end of TAF. While TAF would benefit from diversity I don't believe getting rid of TAF is the best course of action. 

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.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Wednesday, March 9, 2022

Some Lenders promoting false "racist appraiser" narrative to optimize profits via AVMs, by Mary Cummins real estate appraiser

mary cummins, real estate appraiser, los angeles, califoria, lender, amc, avm, hybrid appraisal, racism, bias, discrimination, bettermortgage, urban league, andre perry, house canary, zillow
mary cummins, real estate appraiser, los angeles, califoria, lender, amc, avm, hybrid appraisal, racism, bias, discrimination, bettermortgage, urban league, andre perry, house canary, zillow

Like most businesses lenders want to optimize their profits. One way to make more money besides charging more is to pay less in costs and fees. One way for the lender to do that is to pay the appraiser less or just get rid of them and use a free or very inexpensive Automated Valuation Method (AVM). 

I personally don't care if a lender or borrower wants to use an AVM. There is enough business out there for appraisers because not all appraisals are for loans and not all government insured loans allow AVMs. They generally don't allow them in higher risk situations such as high loan to value (LTV) ratio, cash out, lower credit score ... 

My only issue with the use of AVMs instead of a full inspection appraisal has to do with the borrower. The borrower could get a lower value, resulting smaller loan and pay more for that loan due to higher LTV ratio i.e. risk, if the property is better than average for the neighborhood. AVMs are biased against properties that are anything other than average in every respect.

AVMs assume average condition, location, view, quality...  (Ref 1). If you're buying a better than average home for the area, higher quality, fully remodeled, in a better location in the neighborhood with a great view, the value will come in lower than true market value with an AVM. If you're buying a home priced less than most in the area in fair condition with no view or upgrades, an AVM will give you a higher value and a higher loan amount. You could end up upside down with no equity if you accept a higher loan. 

My issue is with lenders and others who are using and promoting the false "racist white appraiser" narrative to market themselves and AVMs as less biased just to increase their profits. They are glomming onto misleading data and false media articles to use for their marketing purposes at the expense of the borrower and the reputation of appraisers. Yes, racist appraisers exist but not all valuations are based on racism and bias. Below are some quotes used by lenders and others to promote this false narrative. 

House Canary. "HouseCanary hopes its tech can help solve appraisal bias."

https://www.housingwire.com/articles/housecanary-hopes-its-tech-can-help-solve-appraisal-bias-can-it/

Their true agenda shines through in the article, "While a typical appraisal could cost $400 to $500 and take several weeks, HouseCanary says it can perform a “condition-informed evaluation” within one to four days, for $100." Who cares if it costs the lender less. The lender doesn't pass on these savings to the borrower. The lender will charge any fee they think they can get. I've had borrowers contact me and ask why their appraisal was $1,100. I only got paid $350. They also asked about the $300 charge for a review appraisal. There was no review appraisal. I've bought and sold properties. I've found plenty of junk fees that would have gone to the lender. Even if a lender tells you there are no points, appraisal fees, you are paying it in the rate. Nothing is free except maybe the AVM at least for the lender. 

An inaccuracy in the article, "There’s nothing about an appraiser that’s better than someone you’ve literally trained (to inspect, measure, take photos of a home) for a few days." 

Appraisers bring years of experience to the table. I've appraised over 20,000 properties and have taken over 1,350 hours of education. We can see major defects and other things which would negatively affect value. Someone with only a few days of training will miss a cracked foundation, water damage in the basement or attic, uneven floors, tilting walls, mold, unpermitted addition, additions not done to code, additions that don't meet basic health and safety code for the city, county, state; missing safety features, area which is not ANSI legal gross living area GLA, evidence of a meth house, manufactured house verses stick built, effect of nearby power station, industrial properties, within 500 feet of a freeway, flight path, a skim coated floor to cover uneven floors, evidence of asbestos... A licensed appraiser would probably call for inspection by a licensed expert for major issues if they saw it. This could save a buyer hundreds of thousands of dollars down the line if they read a full inspection appraisal report. There's no inspection report to read in an AVM. If you had a hybrid appraisal with a non-appraiser inspecting it, you don't get an inspection report that could tell you more about the true condition. The appraiser hasn't seen the property, comparables or exact neighborhood in a hybrid appraisal.

Appraisers can also see items which add to value such as degree of view (180 degree ocean view, peek-a-boo canyon/tree view, view of the side of an apartment building), specific location in a tract development (on a hill, cul-de-sac, busy corner, near industrial), quality of construction, specific types of very good materials... 

A typical appraisal generally doesn't take several weeks unless you're in some rural areas. This is another misnomer used to argue for cheaper AVMs. An AVM would still be faster unless you ordered a rush appraisal to be completed in 24-48 hours. A hybrid appraisal takes the same amount of time as a full appraisal. A wait of a few days for a full appraisal would be worth it to the buyer, borrower. 

BetterMortgage. Better Mortgage uses race to sell loans and promote themselves as "diverse." "Several studies have shown that people tend to subconsciously associate with their own race more positively, and 96.5% of all real estate appraisers are white. Between 2015 and 2020, appraisal gaps came up at a rate of 15.4% for Latino-majority neighborhoods, and 12.5% in areas with a majority of Black homeowners.

If an appraiser’s evaluation feels off, don’t be afraid to get a second appraisal. It also helps to work with companies that are committed to diversifying their team. Starting next month, Better will be hiring and training a pipeline of 120 in-house appraisers who are representative of the communities they serve."

The numbers above came from a Freddie Mac study that compared appraisal values to AVMs appraised values and the contract price. (It was Fannie Mae who compared to their AVMs). In some areas the appraisal values were lower than Freddie Mac's own AVMs and contracts and in other areas they were higher. The Freddie Mac study stated they don't know the cause of the differences. "First, our analysis has not yet determined the full root cause of the gap." Danny Wiley of Freddie Mac stated "We have not reached any conclusion for cause of the gaps or correlation." The gap could have many causes such as revitalizing areas and condition. AVMs assume average condition, average everything. Perhaps the homes appraised by appraisers over AVM values were in better condition than average, better than average location, better than average view, upgrades...

BetterMortgage never hired or trained those diverse appraisers. They instead soon after the press release fired 900 people then 3,000 more. It was all talk to drum up business and investors. 

https://better.com/content/what-you-should-know-about-home-appraisals/

Urban League. Urban League is not a lender but they have been promoting the same false narratives and the misleading paper because it supports their beliefs. Racism and bias exist but not all appraisers, appraisals are biased. "AVMs could correct for racial bias from appraisers evaluating homes and the conditions in majority-Black neighborhoods." "Automated valuation models, or AVMs, hold great promise for reducing the costs of and increasing the accuracy of home valuations. They allow financial institutions to estimate a home’s value with a reduced role for human opinion. By limiting the human element, estimating a home’s value should become less expensive and more accurate." "Many housing experts believed that widespread appraisal bias contributed to the housing crisis. In-person appraisals are susceptible to charges of racial discrimination and human bias."

Appraisal bias had nothing to do with the great recession. The great recession had to do with deregulation and a market bubble. Lenders offered no doc high risk loans to anyone and everyone. Some had low teaser rates which adjusted to high mortgage payments which people could not afford. After the bubble burst, values dumped and people let their homes go back to the bank. Appraisers get blamed for every financial crisis from the S&L crisis, great recession and now appraisal gaps. These issues have never been the fault of the appraiser. Appraisers don't make values. We merely report them as the messenger.  We are just the usual scapegoat. 

https://www.urban.org/sites/default/files/publication/103429/how-automated-valuation-models-can-disproportionately-affect-majority-black-neighborhoods_1.pdf

One important issue here is the alleged research upon which the "racist appraiser" narrative is based. It's just a personal paper written by Andre Perry. It was not published or peer reviewed independent research. The false summary of this paper is that most black owned homes are "appraised" for less than white owned homes by an average of $46,000 each. Appraisers and appraisals have allegedly "devalued," "stolen money" from black homeowners which is totally false.

This data was based on AVMs and not valuations by appraisers. There were no appraisers involved in the research yet people are stating this proves appraisers are racist. On top of this the data came from failed inaccurate Zillow. Everyone knows the "a" in "Zillow" stands for accuracy. Zillow is probably the least accurate AVM out there. The data actually just shows that people with less money buy and own homes which cost and are worth less than people with more money. They buy what they can afford. They never adjusted for home location or income, net worth of homeowner in the data. Research has shown that whites make and have more money than black people, POC. Income equality is the real issue which must be solved not appraisers and home valuations. Whites also buy more expensive cars. Did appraisers and Kelly Blue Book's online AVM "steal" money from cars owned by POC? No. They buy less expensive cars to begin with.

Today's political climate has clearly changed. "The country is in a time of racial reckoning, heightened by a summer of protests against systemic racism and police brutality following the death of George Floyd in police custody." Floyd's death "sparked the largest racial justice protests in the United States since the Civil Rights Movement." "According to data from various sources, the Black Lives Matter movement is now the largest movement in US history." While racism exists and must be banished from our nation the pendulum has now swung to the extreme side. In this new light anything and everything is automatically "racist" today before even looking at the facts. Some have even been weaponizing race and other issues for their own agenda. 

The other misleading information about alleged "racist appraisers" comes from false media articles. One major one which finally made it to the courts is Austin v Miller. In this widely publicized media article and lawsuit the Plaintiffs argue that using similar homes which have sold in the same neighborhood as their home to value their home is "racist" and "biased." Austins wanted the appraiser to use comps "in the whiter areas" over a mile away instead of the "black area." These are exact quotes from the lawsuit linked above. Per law and the appraisal itself values are based on similar sales in the same neighborhood. The appraiser was not biased. 

Here are a couple of other false and misleading case, Carlette Duffy in Indianapolis, Indiana and Cora Robinson in Oakland, California. Based on my research the second appraisals were incorrect and higher than market value. They used comps from superior areas much farther away from the subject. 

Every appraisal value you don't like is not the result of a racist appraiser intentionally low balling you because of your race, color, ethnicity... Full inspection appraisals are not inherently racist or biased. AVMs are not racist but they are biased against any home other than an average home. Median and average home sold prices are built into the AVM formula, the algorithm. 

Racism is very real. Some people are absolutely racist and express that in their behavior. We all must fight racism. Wasting time on a non-racist issues takes away from real issues of racism and bias. Using the false "racist biased appraiser" narrative to promote AVMs, hybrids to make money at the expense of other people is wrong. 

I read the below article published the day after I wrote this article. People are noticing the anti-appraiser agenda. Jeremy Bagott of Appraiser Blogs, Certified General Real Estate Appraiser at Bender Rosenthal Inc., former newspaper man. 

https://appraisersblogs.com/anti-appraiser-agenda-follow-the-money

References

Ref 1 Corelogic, "AVMs assume all properties are in similar average market value.condition. They cannot adjust values down for disrepair or damage. Similarly, they cannot adjust values up for good upkeep or cosmetic upgrades, such as new carpet or paint. The AVM has no knowledge of the condition of a particular property."

 https://www.corelogic.com/wp-content/uploads/sites/4/downloadable-docs/about-automated-valuation-models.pdf

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.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Wednesday, January 19, 2022

PAVE Task Force Report Coming February 2022, by Mary Cummins Real Estate Appraiser

False and misleading. "The Interagency Task Force on Property Appraisal and Valuation Equity. An equitable path toward addressing the persistent misvaluation and undervaluation of properties experienced by families and communities of color." pave, task force, mary cummins, real estate appraiser, los angeles, california, 

The image above came from the PAVE Task Force website at https://pave.hud.gov . Their statement "the persistent misvaluation and undervaluation of properties experienced by families and communities of color" is very misleading. "Misvaluation" and "undervaluation" have not been proven. There hasn't even been any independent research on the issues. Andre Perry's non peer reviewed, non published personal paper has been shown to have major statistical flaws intentionally made by Andre Perry for his agenda in promoting his book for money. Fannie Mae's research showed there was no major difference in appraisal gap based on the race of the borrower. 

Per the National Association of Realtors (NAR) the Task Force report is coming out February 2022. It will be interesting to read the final report. With statements like the above they clearly have an agenda. If you remember, this was Joe Biden's campaign platform. Here's an article I wrote about Joe Biden's false statements about appraisals and appraisers. Team Biden basically invented a problem that didn't exist so they could promise to fix it just so they could get the vote of POC. I'm a Democrat. I understand politics and campaigning but this is just plain wrong to vilify people and a profession for your own agenda. 

Here's an article I wrote about the purpose of the Task Force. It lists all the members of the Task Force. Again I'd like to note that James Park of the Appraisal Subcommittee (ASC) is the only Appraiser on the Task Force. He doesn't represent Appraisers but the ASC. 

There are some things which should be changed such as the requirements to become an appraiser. The apprentice mentor program is not working. It's too difficult for apprentices and mentors. 

It will be interesting to see the final report. I predict it will basically suggest regulations and actions which are similar to our current regulations but worded as if they are new.

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.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Friday, November 12, 2021

Home Staging is to Increase Sales Price. It's Not About Racism. Mary Cummins Real Estate Appraiser

Recently there have been a few media articles about black people who allegedly white washed their home i.e. removed all traces of blackness and received a higher appraisal value. These misleading articles have spread a false narrative about real estate agents, appraisers, sellers, buyers and the legitimate process of "home staging."

When someone lists their home with a real estate agent for sale the agent will tell them they must prepare and stage their home. Below is a brief summary of how a seller should stage their home in order to get the best price in the least amount of time from Smart Box Moving and Storage. As a real estate broker and appraiser for over 38 years I agree with this list.

"When you are preparing your home to put it on the market, experts suggest that a key part of home staging is removing personal items from the house. A strategically staged home typically sells faster and for more money so it’s important to take the necessary steps to properly stage your home. Removing certain items from the home will make your home feel larger, more organized, and will also help prospective buyers visualize themselves living in the home. Prospective buyers will take notice of every detail in your home so don’t turn them away by having the wrong items in your house. Consider removing the following items to ensure your home appeals to all buyers. 

Family Photos

While you may adore those large portraits of each of your kids, it’s best not to showcase those when you are staging your home. Buyers might be distracted by all of your family photos and it could make it harder for them to envision themselves living in your home. The idea is to help buyers visualize themselves in your home and this can be difficult with a display of family photos. 

Taste Specific Artwork and Accessories

Typically, when you decorate your home, you do so according to your own taste and personality. However, when staging a home, you don’t want your personality to stand out. For instance, you might be an avid hunter but not everyone will appreciate animal heads hanging on the wall. People might also be offended by certain artwork such as nudes, religious art, or political posters. It’s best to remove any taste specific decor and place a few neutral pieces around the home instead. 

Collections

Collections have a tendency to take over a space and make it appear cluttered. Buyers might miss the detailed crown molding if they are distracted by an overwhelming collection. A portable storage container is a great solution for storing your valuables and collections while you are selling your home. 

Awards and Certificates

While you might be proud of those diplomas, sports trophies, and school certificates, now is not the time to display them. Much like the family photos, it can be difficult for buyers to envision themselves in your home when they see so many of your personal items. Depersonalizing space is important because it will help buyers psychologically move in. 

Firearms

If you keep guns in your home, it might be a good idea to place them in storage while selling your home. Not all buyers will be comfortable with the idea of having firearms in the home and this can be a deterrent. 

Personal Items

As tiresome as this might seem, it’s important to erase the evidence that you actually live in your home any time you are showing it to a potential buyer. Remove personal items such as toothbrushes, medications, shampoo, glasses, dirty laundry baskets, dirty dishes and so on. You can hide many of these items in pretty baskets or boxes with lids. You can even hide things in plastic bins that will easily slide under the bed. 

Pets

They may be your best buddies but your furry friends don’t appeal to everyone. Pets are messy, dirty and stinky and not all buyers love them. Some people might be turned off by the fact that there are pets in the home so it’s important to find a place for them to go when you are showing your home. You should also remove any evidence of pets living in your home such as food bowls, cages, and toys.

Excess Furniture

Having too much furniture crammed into a room can make the space look smaller and this is definitely something you want to avoid when selling a home. Your goal should be to arrange furniture in a way that compliments the architectural features of the room while giving the illusion of spaciousness. You also want furniture that serves a purpose and showcases how the room could be used. For example, a desk and chair would show that the room could be used as an office while a bed and dresser would show that the room would make a nice bedroom. Avoid excess furniture or furniture that doesn’t belong. For example, you wouldn’t want a treadmill sitting in your bedroom. A portable storage unit is an ideal solution for storing your excess furniture while your home is on the market. "

The most important item to remove is personal items and photos. From blog article "Why You Should Remove Personal Items in Home Staging," "Removing personal items is perhaps the most important thing when it comes to home staging. Potential buyers don’t want to know about the family that lived on the property before. You risk distracting or alienating potential home buyers by leaving personal items on display (family photos, religious texts, favorite movies, even sports memorabilia). Imagine walking into someone else’s home for the first time. You’re likely on your best behavior and very hesitant about breaking something or going into a room you’re not supposed to be in. It’s not as comfortable as your own home because the space simply is not your home. That’s the opposite of what you want your buyers to feel. Ideally, when someone walks into a staged property, they can easily visualize the space as their home. Lining the walls with personal artifacts ruins that illusion. Nobody wants to feel like they’re intruding."

There are a few people with their own agenda who are promoting the false narrative that black people must white wash their home when it's being appraised because real estate appraisers are racists who appraise black people's home lower than market value. That is absolutely false. Real estate appraisal is based on the home characteristics and recent sales only. Appraisers don't care about the race of the owner, tenant or buyer. We generally never even meet them or know what color they are. We only care about the structure and what other similar homes have sold for. We use the same methodology as Automated Valuation Methods which are robots who don't see any people or the home.

Sometimes a homeowner will tell me "I'm sorry my home is messy today." I generally jokingly tell them, "it's fine. The bank wouldn't care if you had dead bodies hanging in here. They only care about the structure and the value." That is the absolute truth. The bank just wants to make money on the loan. They want a full market value appraisal so they can make money. The appraiser wants the same. If we were to come in below market value, we'd never be hired again and lose money. There is absolutely no incentive for an appraiser to come in low.  

A few media articles stated that a black family had their home appraised. The value was lower than they liked. They decided to white wash, stage their home and request a new appraisal. The second later appraisal came in higher. In this quickly appreciating market of course a later appraisal would be higher yet they attributed the rise in appraisal value to their white washing. They could have just changed the door mat and the same thing would have happened. With certain areas appreciating 30% in a year that turns out to 2.5% per month. With a $500,000 home the appreciation could be $25,000 in two months. The appreciation could be even higher if they first had it appraised it during a slower sales time of year then later reappraised during the peak sales times when there were more buyers, sales and higher sale prices. It would be even higher if it's an area that's being revitalized or as some say "gentrified." I've seen increases of 40-50% in a year in some of these gentrifying areas recently.

Racism is a huge problem in the US which we must try to eradicate. Racist things happen to people of color all the time. Since the murder of black George Floyd racism against black people has been a huge issue. That said not everything is due to racism. Many people's appraisals are coming in lower than expected because of the fast appreciation rate in the market. Closed and recorded sales lag 45-60 days behind contracts for sale. During that time home values appreciate. This is not the fault of the appraiser but the nature of the mandatory historical approach to home value. 

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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