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 LinkedIn
• Mary Cummins Meet up
• Cummins Real Estate on Facebook
• Mary Cummins Real Estate blog
• Cummins Real Estate on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on MySpace.com
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK

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

Appraisal Subcommittee Hearing on Appraisal Bias January 24, 2023, notes by Mary Cummins

Appraisal Subcommittee Public Hearing on Appraisal Bias, January 24, 2023, marcia fudge, mary cummins, asc, hud, real estate appraiser, pave taskforce, cfwb, jim park, race, racial bias, discrimination, black, brown, white, value, neighborhood, appraisal, valuation

https://www.consumerfinance.gov/about-us/events/appraisal-subcommittee-hearing-on-appraisal-bias/

https://www.youtube.com/watch?v=QW8ADw9vOSc

Appraisal Subcommittee Hearing Meeting about Appraisal Bias in Residential Real Estate Market ASC notes, comments by Mary Cummins. Part of the meeting was on C-SPAN 2.

Time: 2:10:35

“Streamed live on Jan 24, 2023. Join the Federal Financial Institutions Examination Council’s Appraisal Subcommittee (ASC) for a hearing about appraisal bias. Invited witnesses representing key stakeholder groups will share their views with the ASC during the hearing.”

Official information and files.

The Federal Financial Institutions Examination Council’s Appraisal Subcommittee (ASC) held a hearing about appraisal bias.

"This first-ever ASC hearing was led by Deputy Director Martinez and ASC Executive Director Jim Park. HUD Secretary Marcia L. Fudge, CFPB Director Rohit Chopra, and FHFA Director Sandra Thompson also participated in the hearing. Panel witnesses included:

Dr. Junia Howell, Visiting Assistant Professor of Sociology at the University of Illinois Chicago; Witness Testimony. It'd be better to read her testimony because she was extremely nervous, waving her arms around wildly, misspeaking and acting agitated. Most upsetting and more importantly she stated some totally false and ignorant things. She said the sales comparison approach was developed in the 1930s by whites in the US government to intentionally value white owned property higher than POC owned property. She doesn't even realize that most living in areas which were, are primarily POC especially back then were, are renters and not owners. There are also poor white areas in the US. How does she explain that? The sales comparison approach to value is the main method used to value all assets all over the world since the beginning of time. She said the government should basically give more money to her to do more deeply flawed "research." It appears that all speakers had to swear to the host of the meeting that they will only agree with the government's incorrect and preconceived ideas on the issue of the alleged "appraisal" and wealth gap. She's so ignorant she doesn't realize it's caused by the income gap and not appraisals. Lots of independent research out there to prove this. People buy homes they can afford. People who make less money but less expensive homes.

https://files.consumerfinance.gov/f/documents/cfpb_appraisal-hearing_junia-howell-testimony_2023-01-24.pdf

Paul Austin and Tenisha Tate-Austin, homeowners from Marin, California; Witness Testimony 

https://files.consumerfinance.gov/f/documents/cfpb_appraisal-hearing_paul-austin-and-tenisha-tate-austin-testimony_2023-01-24.pdf

Michael Fratantoni, Senior Vice President of Research and Technology and Chief Economist, the Mortgage Bankers Association; Witness Testimony 

https://files.consumerfinance.gov/f/documents/cfpb_appraisal-hearing_michael-fratantoni-testimony_2023-01-24_Tw7XwtE.pdf

Craig Steinley, President, the Appraisal Institute; Witness Testimony 

https://files.consumerfinance.gov/f/documents/cfpb_appraisal-hearing_craig-steinley-testimony_2023-01-24.pdf

More information about the Appraisal Subcommittee can be found here" 

MEETING START

Time: 6:29 Introduction by Zixta Martinez Chair of Board of ASC and CFPB. Jim Park will talk about ASC. We’ll hear from a panel of witnesses, a home owner, lender, appraiser and academic. She introduced Marcia Fudge head of HUD.

Time: 9:28 Honorable Marcia L Fudge of HUD and PAVE. I'm only going almost word for word what Fudge said because it's so important. Fudge makes her own personal bias very clear in what she said and the falsehoods she stated.

Fudge said “good morning” and got a mild response. She basically responded she didn’t like the mild response and again said “GOOD MORNING!” and everyone then responded with “GOOD MORNING!” It set the tone.

Since day one the Biden Harris administration has worked to root out bias in the appraisal system. The work is critical to advance racial equity. It’s important to me as secretary of HUD and as a black woman. I know first hand what it’s like to be told that your home is worth less than the house down the street because of the color of your skin. It’s heartbreaking to hear the stories of black and brown families who feel forced to remove family mementos and photos in hopes of receiving a fair and accurate valuation. I do not intend to do that!

Fair Housing Act of 1968 was to end housing segregation. Owning a home should provide a path to the American dream. Instead this country does not see us as equitable. June 1, 2021 100 years after Tulsa Race massacre Biden and Harris established PAVE task force a first of its kind initiative to root out racial discrimination in the home buying process so families of all backgrounds and neighborhoods can have a better chance at building generational wealth. Less than a year after PAVE was established we delivered an action plan which constitutes set of reforms to advance racial equity in the home appraisal process. We want to cultivate a well trained and diverse work force, to make sure technology doesn’t perpetuate bias. HUD made $28M available to fund testing, education, and outreach to communities on appraisal bias. Next week we will start a three part webinar on training for appraisers and housing professionals on how to identify bias and protect homes. We, (pointing to herself), know how to identify it as we see it every day. We are giving an avenue for FHA loan seekers, if they believe their appraisal was skewed by racial bias. You can make comments on our drafting table platform. Please, make comments. 

I’m going to say things not in my script because I live this every day. I live in a black community by choice, BY CHOICE! I want kids in my neighborhood to get same schools as properties next to me. You do that by property tax even though I think it’s unconstitutional, that we fund schools by property tax. I want same police, fire protection but you can’t do it if my house is valued at $50,000 less than the house next to me. Two doors from me there is a neighborhood that is all white. My house is bigger, my lot is bigger, my house is nicer (laughter). That (other) house is valued more than mine. This is not the America that we should be living in, in the year 2023. It is a travesty, outrageous and we must change it. I’m hopeful the ASC will do what is right for the American people.15:44.

Mary Cummins comments. Homes are not valued differently because of the color of the skin of the owner, borrower or occupants. It's a mathematical formula based on most recent similar sales in the same neighborhood. Appraisers don't know the color of skin of homeowners, borrowers, tenants, buyers, sellers. We don't see the borrower, buyer and definitely don't know who owns properties in the area we use as comparable sales. We don't look at census tracts. We don't know race or color. It's possible all the owners of the homes we used as comp sales for a property owned by a black person were white. That would mean Fudge's false narrative holds no water. 

Fudge states she wants home values and their property taxes to increase. Many poor people would be forced to sell their property and move if property taxes were increased to the level of newer more luxury expensive neighboring properties.They wouldn't even be able to sell their property for the higher non market value. That would be beyond unfair and cruel.

All real estate agents tell all home owners of every color to remove personal articles such as photos, collectibles and other items from their home.It shows the home bigger and better. Buyers don't want to see any homeowner in the home. They want to envision themselves in a blank slate of a home. It's not about race.

HUDs PAVE report was late. It was due in six months. Fudge acts like she finished it early in less than a year. Nope. Late. 

Appraisal appeal, reconsideration of values have ALWAYS been available to borrowers forever. They can appeal based on any reason. They have done this. This is not about bias. Research by AEI based on government loan documents proved there is no effect of race on home value. They used the government's own data to show this. AEI presented this to the government in the meeting about the PAVE task force. 

AVMs Automatic Valuation Methods do not consider race or color of homeowner or borrower. It's a math formula, technology computed by robots. No human is involved. The math formula is not based on race or color. It's based on location, size, age. It does not know condition, view, upgrades, amenities, true size, additions, lot type, location in neighborhood... AVMs value homes in poor condition higher than market. It values upgraded homes with views lower than market. AVMs aren't accurate. They are BIASED against everyone.

Fudge brought up her home value previously. She said her home is worth less BECAUSE SHE IS BLACK. I included it in a past article with address and attributes. I included a valuation of her home and of the NEW, LUXURY homes up, across the street from her. It's a private development of new luxury homes tucked away off the main street. I have no idea if the homeowners are all white. I doubt Fudge does either. Has she visited all of them personally? They're new so they're not in the census report. There is a reason why those homes are worth more. They're new, luxury, in a new development, with a clubhouse, off the main street... Not all homes of the same size in the same county are worth the same. An old run down home in South LA is worth less than a new one of the same size in Beverly Hills. If Fudge doesn't know this, she must resign because she's unqualified. I know she knows this and is just lying for effect. She's a politician working for politicians selling lies for votes, money and promotions.

The real reason why homes owned by whites are worth more than homes owned by black, brown people is the income gap. People who make more money have more money, more generational wealth and can buy and own more expensive homes. THIS IS THE REAL ISSUE! The government needs to fix the income gap then the wealth gap would solve itself. Men also make more than women. Blaming appraisers will never fix the real issue. The government can't fix the problem (if there even is one) until they admit the real cause of the problem. The first step Scientific Method to solving problems is to determine the actual problem.They clearly don't want to fix the real problem. That means the government doesn't really care about POC or the poor. They need to stop pretending like they do care when they clearly don't. You can yell at appraisers all the live long day and that won't solve the problem. 

I'll post notes from rest of the meeting letter. I will also be sending in a comment. I see some of the speakers are the Austins from California. I have covered their case since the beginning. In their linked statement they said they wanted the appraiser to use comps from the "white area" instead of their immediate neighborhood which they said is a "black area." Who are the racists here? 

There were five witnesses who basically read word for word their submitted statements linked above except AI Craig Steinley. He omitted a large portion of his written statement. I think he omitted it because he didn't want questions and to get under five minutes. While other speakers said we need to get rid of the "racist" government mandated sales comparison approach AI's statement said they are adamantly opposed to that. Their statement says the approach is based on valid and accurate economic principles which it is. That is how all assets in the world have been valued forever because it is based on supply and demand between buyer and seller. I'll do a short summary in a few minutes anyway. 

After that ASC members were allowed to ask ten minutes worth of questions each.

Email after the meeting

“Yesterday the Appraisal Subcommittee held its first ever Hearing on Appraisal Bias, hosted at Consumer Financial Protection Bureau headquarters in Washington D.C. 

The event opened with remarks by U.S. Department of Housing and Urban Development Secretary Marcia L. Fudge. ASC’s Executive Director James Park spoke on the agency’s role in the appraisal regulatory landscape. 

Attendees, both in person and on the livestream, heard testimony from Dr. Junia Howell, University of Illinois-Chicago, homeowners Paul Austin and Tenisha-Tate Austin, Michael Fratantoni, Chief Economist, Senior Vice President, Research and Industry Technology, Mortgage Bankers Association, and Craig Steinley, President of the Appraisal Institute.

Now ASC wants to hear from you! You are encouraged to provide a comment on your perspective on or experience with appraisal bias; comments can be submitted to AppraisalBiasHearing@asc.gov until February 8, 2023.”

Four of the five witness speakers, Appraisal Subcommittee Public Hearing on Appraisal Bias, January 24, 2023, marcia fudge, mary cummins, asc, hud, real estate appraiser, pave taskforce, cfwb, jim park, race, racial bias, discrimination, black, brown, white, value, neighborhood, appraisal, valuation

Witness Dr Junia Howell, Appraisal Subcommittee Public Hearing on Appraisal Bias, January 24, 2023, marcia fudge, mary cummins, asc, hud, real estate appraiser, pave taskforce, cfwb, jim park, race, racial bias, discrimination, black, brown, white, value, neighborhood, appraisal, valuation

Tenisha Tate Austin, Paul Austin, Appraisal Subcommittee Public Hearing on Appraisal Bias, January 24, 2023, marcia fudge, mary cummins, asc, hud, real estate appraiser, pave taskforce, cfwb, jim park, race, racial bias, discrimination, black, brown, white, value, neighborhood, appraisal, valuation

ASC members, Appraisal Subcommittee Public Hearing on Appraisal Bias, January 24, 2023, marcia fudge, mary cummins, asc, hud, real estate appraiser, pave taskforce, cfwb, jim park, race, racial bias, discrimination, black, brown, white, value, neighborhood, appraisal, valuation

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 LinkedIn
• Mary Cummins Meet up
• Cummins Real Estate on Facebook
• Mary Cummins Real Estate blog
• Cummins Real Estate on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on MySpace.com
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK

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

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.

• Mary Cummins LinkedIn
• Mary Cummins Meet up
• Cummins Real Estate on Facebook
• Mary Cummins Real Estate blog
• Cummins Real Estate on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on MySpace.com
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK

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

Gentrification and Urban Renewal, the issues and solutions for an improved community. Mary Cummins

The article linked below is an interesting read about "gentrification." The article states people should be more upset about the areas not being revitalized but they're not.

"What we talk about when we talk about gentrification. The worst problems are in the neighborhoods that aren’t gentrifying." By Jerusalem Demsas@JerusalemDemsas  Sep 5, 2021.

https://www.vox.com/22629826/gentrification-definition-housing-racism-segregation-cities

The term is not even American. It was coined in 1964 by a British sociologist to describe the British "gentry" moving into working class areas. It has to do with affordability. It's not the racial issue that it's become here in the US starting in the 1990's. "Gentrification" is not a dirty word as stated by today's US media and some local community groups. 

The article states "But the core rot in American cities is not the gentrifying neighborhoods: It is exclusion, segregation, and concentrated poverty." I agree with this. The article goes on to state the exclusion, segregation and concentrated poverty is caused by unequal income. Poor people live in less expensive areas they can afford. It would make more sense to help them make more money so they can afford an apartment, living expenses, education ... This concept goes hand in hand with the recent false articles about appraisers appraising homes owned by black people for less than homes owned by white people. POC are more likely to have less money and buy less expensive homes in less expensive areas. The homes used in the data weren't even appraised by appraisers but by robots. 

The article stated "Gentrification as the juxtaposition of the haves and have-nots." I see this every day. Someone with less money moves into an area with less expensive rent. Over time the city, businesses, neighborhood groups improve the blighted area as part of urban renewal and revitalization. New parks, streets, stores open as the area is cleaned up and improved. Sometimes the people demanding that the city improve the area are the ones who end up complaining about the improvement which increases property values and corresponding rent. Long time resident property owners are happy but not the tenants. Those tenants originally drawn to the blighted area for cheap rent now may have to pay a higher rent or move. This upsets them and causes them to protest, attack new businesses and new neighbors falsely claiming the new people are intentionally destroying their culture, history and language. The renters actually just want the money, homes and stores the new people have. 

From the article, "It’s no wonder that people who have faced centuries of disinvestment grow angry as public and private money flows into their neighborhoods only after high-income, college-educated people choose to move there. Even if those people are not wholly responsible for the inequality, the blatant injustice is hard to ignore." 

This is why some Latinos in Silver Lake attacked new white owned businesses and residents. What's ironic is in that area Latinos replaced Jewish people who replaced Asians who replaced Mexicans who replaced Spaniards who replaced Native Americans after stealing their land. Which one is the bad gentrifier? At least the people who came after the Mexicans bought the land and didn't steal it. 

I'm positive that if you offered the current lower income tenants to either stop the revitalization and let the area become a more blighted but affordable slum or increase their income so they can afford a nice apartment in an improved area they would prefer to increase their income. This is the no brainer solution to the conflict. Help lower income people increase their income. The solution is not to stop urban renewal and revitalization. That would mean encouraging blight, crime and loss of housing units. From the article, "As George Washington University professor Suleiman Osman wrote in his 2011 book The Invention of Brownstone Brooklyn: “Stories abounded of renters [in Brooklyn] being pressured by landlords to leave revitalizing areas. But non-revitalizing blocks with high rates of abandonment and demolition saw rates of displacement that were just as high.”

The people moving into these less expensive areas don't just have more money. They are also more educated and different in other ways. This can cause friction with some people similar to what's happening in Texas with the California tech industry relocation. In Texas things are even worse because property tax goes up based on current market value. This means an elderly person who has lived in a house a long time now has to pay very high property taxes. They generally are forced to sell and move. At least in Los Angeles we don't have the same property tax issues. 

Gentrification isn't always about people of color being displaced by white people. Again, Austin, Texas is one example, another is England. The tech industry is more diverse. People of color and wealthier more educated white people are displacing less educated, less wealthy white people in Texas. It's not a race issue but a wealth issue. Obviously the more wealth a family has the better education the children can receive. 

A main issue of people who cry “fire, fire, gentrifier” is increased rent. That's not always the case. In Los Angeles, California we have rent control which prevents most of this. I've seen people who have stayed in their same cheap apartment since the '70's for this reason. During that time they've even bought homes which they rent to other people which doesn't really support the purpose of rent control.

"Overall, the research literature leans toward the view that gentrifying neighborhoods can lead to displacement, but they don’t have to. Gentrification can bring with it the promise of integration and sorely needed investment that can increase residents’ quality of life — but only if disadvantaged residents are set up to take part in the benefits of increased investment."

The article goes on to summarize the situation as "City by city, the message is clear: Segregation and concentrated poverty are the true blights of urban life, despite our fascination with gentrification." They're talking about segregating people with less money and not race. Here in Los Angeles and most of the US there is a correlation between people of color, immigrants and having less money. That's not the case in Texas, England ...

The article offers a solution to the real problem, "How to ethically create integrated neighborhoods. First, the economic literature is clear that increased housing production reduces rents. Second, tenant protection policies could help forestall some evictions. Third, rezoning of wealthy white segregated neighborhoods could slow the speed at which gentrifying neighborhoods change, and help tackle segregation. These types of interventions can provide a roadmap for how to ethically integrate urban neighborhoods."

By rezoning they mean allowing 2-4 units in some residential single family zones near public transportation. They're not talking about turning Beverly Hills estate neighborhoods into huge apartment buildings with only cheap studio units. Limiting homes to single family only zones is a more recent development in cities. Years ago in Los Angeles you could almost build whatever you wanted anywhere. By the 1900's the first developers and then cities limited zones to single family, 2-4 units, apartment buildings, commercial, industrial.... because that is what home buyers wanted. Some early examples are housing developments which had deed restrictions starting in 1903. The deed restrictions didn't have to do with race, color or nationalities but with the type of properties that could be built in the development. Some restrictions included quality, styles of homes, set backs, height, size... Only homes could be built in those residential developments. 

The article ends with this, “Gentrification is a cultural sphere to work out feelings of resentment around inequality. ... Those feelings aren’t to be discounted,” Gottlieb argues. “This is a manifestation of a long-running sense of ‘I am not welcomed in the city, I don’t have a right to the city.’ Sometimes those feelings can be worked out in the cultural terrain of gentrification, even indeed if the people moving in aren’t the proximate cause for them leaving.”

We need to deal with the issue of "gentrification" for what it actually is which is revitalization. People pushed out of more expensive areas move into less expensive areas. The city, businesses and community improve and revitalize those areas. The revitalization must just be done ethically while still attracting new business investment to the area. Most importantly we must help people with less money improve their financial situation. This would help all of us and our community by solving the disparity of income, home ownership rates and home values among wealthy and less wealthy people. It's not a race but a financial issue. Fighting, NIMBYism and trying to stop all development is not the answer. That would just make the situation even worse for everyone.

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 LinkedIn
• Mary Cummins Meet up
• Cummins Real Estate on Facebook
• Mary Cummins Real Estate blog
• Cummins Real Estate on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on MySpace.com
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK

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

Alleged discrimination in real estate appraisal 10222 Elmfield, Loveland, Ohio, Aaron and Erica Parker, by Mary Cummins

erica parker, 10222 elmfield, loveland, ohio, aaron parker, mary cummins, discrimination, racism, black, white, real estate appraisal, real estate appraiser, real estate, contract price, false, misleading, amy goodman, 

Here is another case of alleged discrimination in a real estate appraisal. The owners posted their full names, home location, appraisal values, list and sale prices so I will also share it. 

Aaron and Erica Parker owned a home located at 10222 Elmfield Dr, Loveland, Ohio 45140. They purchased it April 9, 2014 for $371,978. Per the MLS it was listed for sale April 13, 2021 for $525,000 by Amy Goodman of the Sibcy Cline real estate office MLS #1696320. Amy Goodman claims she is the "Fair Housing Officer" for Sibcy Cline real estate. She is not an Officer and not a Fair Housing Officer for the FHA or HUD but merely using that title most likely to promote her business. 

Allegedly Aaron and Erica Parker listed the home for $525,000 then instantly agreed to accept about $504,000 for the property. I assume they still paid the commission to Amy Goodman even though she didn't market or show the property. Erica stated after they got the instant offer she was "ecstatic" and “We were high-fiving each other,” “We were texting our Realtor, like, ‘Can you believe it?’”

Allegedly the first appraisal on May 5, 2021 came in at $465,000 which they said was $42,500 below the contract price. We can do math so contract was $507,500. At first their agent asked them if they would reduce the price. Parkers said no. Is this agent working for the Parkers or is she friends with the buyers giving them this pocket listing without any other bidders?

Per the article. "Goodman and the Parkers asked the appraiser and the buyers’ lender to correct the errors in the report. The appraiser refused, they said, saying he stood by his analysis. The lender had a staff member review the appraiser’s work and stood by the total, too." 

Based on my experience if someone submits a reconsideration of value i.e., an appraisal appeal, with similar higher priced comps and it has merit, the appraiser, AMC, lender will adjust the value. That didn't happen. I'm assuming there was no merit.

For no reason the sellers automatically assumed it was racism per the article. They decided to remove all traces of their skin color from the home and request another appraisal. The article states they "erased blackness from their home." Erica called it "white washing." May 20, 2021 the second appraisal came in at $557,000. They were happy. They assumed the higher appraisal was caused by their skin color washing. Then they sold their house June 11, 2021 for $507,500. 

First, some questions. If they thought it was worth $557,000, why the hell did they sell it for $507,500? That means they agreed to sell it for $50,000 less than it was allegedly worth. Was their real estate agent scamming them by listing it low and selling it as a pocket listing? They allowed a few people and two appraisers to view their home. Why not put it on the market and just not do open houses? No one is doing open houses today anyway. They could have sold it within a week in this market with a few private showings all in one day while they're out. There were photos from the last 2014 sale still online. 

As usual there is more to this story than the poorly researched and misleading media article trying to stoke the flames of racism. While I don't usually support robot appraisals I'm going to post some robot appraisal values for this home. This way no one can claim racism as the values are not from live people. They don't see the home, homeowners or anything because they're just a math formula. I am not appraising this property. Robots provided this value estimate. Below are the robot appraisal values for this home as of today, August 19, 2021. The home was appraised in May and sold in June over two months ago in a quickly appreciating market. Values range from $461,000 to $523,000, $497,000 mean/average, $502,000 median. 

Zillow $523,000
Realtor $504,000
Redfn $501,002
Trulia $507,500 
Remax $487,800
USDA Properties $502,800
Spokeo $461,000

Below is a chart from Redfn which tracks their estimates in the past for this home. Based on statistics average home in Ohio appreciated over 11% last year. That's about 1% a month. That means the original appraisal was in line with market value at the time. The second appraisal is clearly too high. At least Aaron and Erica Parker don't have to worry that they sold their home for less than it's real market value. 

erica parker, 10222 elmfield, loveland, ohio, aaron parker, mary cummins, discrimination, racism, black, white, real estate appraisal, real estate appraiser, real estate, contract price, false, misleading, amy goodman

Below is the listing history for the property. Aaron and Erica Parker had been trying to sell their home for a long time with no takers. They clearly listed it too high for the market each time. They even reduced the price twice. 

04/13/2021 $525,000 Pending Cincy MLS #1696320

04/13/2021 $525,000 Listed For Sale Cincy MLS #1696320

03/04/2020 $465,000 ListingRemoved Agent Provided

01/02/2020 $465,000 PriceChange Agent Provided

11/13/2019 $468,500 PriceChange Agent Provided

11/08/2019 $470,000 PriceChange Agent Provided

11/05/2019 $475,000 Listed For Sale Agent Provided

04/09/2014 $371,978 Sold

Here is my take on the situation. Real estate appraisers are limited by the highest recent similar sold home price. Perhaps a nearby similar home sold around $465,000 before May 5, 2021. While the home is on a cul-de-sac it backs up to a major road with a double line. Not good for families with children besides being a nuisance. 

It's possible that another similar home sold after May 5 but before May 27, 2021 for $557,000. Based on the sales I'm seeing that doesn't seem possible. I will bet that a home which was not similar sold for $557,000. The appraiser used a comp outside of the immediate area or it was larger, had more bedrooms, more full baths, more garages, more land and was fully upgraded. Erica Parker claims her home was upgraded. We don't know but the appraisal allegedly said it was not. Maintenance items such as new paint, new same style roof, replacement AC...are not upgrades. Upgrades would be adding a pool, an addition to the home... 

It's possible Erica was talking about "updates." That only has to do with the kitchen and bathrooms. They bought the home new in 2014. It shouldn't really need any updates in just seven years unless it was a poorly made cheap development. In the appraisal it's page one, "Improvement" section near the bottom. These forms are made for appraisers, lenders, underwriters and not lay people to read or understand. What the layperson does not see is the drop down menu which clearly shows it's only about kitchen, bathrooms updates. An "update" would be new or remodeled kitchen or baths. Below is an image which shows the form with the drop down menu exposed. All the viewer sees is the resultant text in the yellow highlighted box which generally says "no updates within the prior 15 years" or maybe "updated" "remodeled" "within 'x' to 'x' years." Complain to the government who made these forms. Click to see larger. 

real estate appraisal, how to read, updates, condition of improvements, upgrades, updated, remodeled, form, no updates, condition, property, mary cummins, real estate appraiser, complaint, 

In another case a  black woman asked for a second appraisal when she didn't like the first one. She didn't remove any evidence of her skin color. The second appraisal still came in higher for other reasons namely the passage of time in a quickly appreciating market. Removing evidence of skin color is not what caused the increase in appraisal value here. I will bet the second appraiser used comps that were not similar but superior to the subject property. 

Another thing to note is that Erica Parker has a history of calling out people and businesses online. She complains on Twitter about businesses. Then she posts the freebies she gets from those businesses in response to her complaints on her Twitter account. The real estate agent Amy Goodman falsely claims she's a "Fair Housing Officer" because she attended a luncheon where someone spoke about housing discrimination. It appears Amy Goodman is promoting this story in order to drum up real estate business acting like she helped her black client deal with discrimination. She clearly didn't because she sold the home for $507,500 when it was "allegedly" worth $557,000. 

My biggest issue with this misleading article is the fake research they cite. Andre Perry, Michael Neal's research does not show that real estate appraisers appraise the homes of black people for less than the homes of white people regardless of all other factors. Andre Perry used Zillow estimates which were made by robots and homeowners guesstimates of value of their own homes. Michael Neal used the same. Neal stated that the robot appraisal values had the same amount of error variance for both white and black areas. No live person or real estate appraiser appraised any of the properties in the research. The only thing the data showed was that people of color generally make and have less money than white people. This is a fact based on real research. For this reason in general they buy and own homes in less expensive areas which they can afford. 

It's extremely reckless for the media to promote these false and misleading narratives and articles. The definition of racism is "prejudice, discrimination, or antagonism directed against a person or people on the basis of their membership in a particular racial or ethnic group." Assuming all white real estate appraisers are racist is actually racism. We use the same math formula to appraise homes as the robot appraisers which are clearly not racist because they aren't even people. 

In this quickly appreciating market some appraisals fall below contract price. Agents know this so they have added appraisal clauses. Here is an article about the current change in political climate which is causing people to call real estate appraisers "racist" when their appraisal doesn't match the contract price. It's not about racism but data and numbers. Actual racism is a horrible evil which should be banished from our communities. Making up false claims of racism when there is real racism out there to fight just divides and harms the community. 

Original article.

https://www.wcpo.com/news/our-community/this-black-familys-home-appraisal-grew-by-92-000-after-they-removed-all-signs-of-their-race

*I am not and did not appraise this property. I contacted the original author of the article and she never replied.

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 LinkedIn
• Mary Cummins Meet up
• Cummins Real Estate on Facebook
• Mary Cummins Real Estate blog
• Cummins Real Estate on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on MySpace.com
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK

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

First Interagency Task Force Meeting on Property Appraisal and Valuation Equity (PAVE) - PROBLEMS, by Mary Cummins

pave task force, hud, mary cummins, real estate appraisal, bias, discrimination, value, valuation, loans, fha, joe biden, white house, marsha fudge, meeting

The first White House Interagency Task Force Meeting on Property Appraisal and Valuation Equity (PAVE) was August 5, 2021. "Task Force members discussed how current appraisal practices are a significant contributor to the disparity in housing values. The practice of comparing properties within similar neighborhoods can be a proxy for racial demographics, which leads to the perpetuation and exacerbation of the legacy of segregation and redlining."

Racism exists. We should do everything we can to fight it. I fully support helping people of color  buy and maintain homes. I've studied segregation, redlining and their effects on community. That said doing away with the main valuation method of assets used around the world would be ridiculous and destroy the economy and our government.

Matched pairs analysis is how ALL assets in the world have been valued since the beginning of civilization. It's how all real and personal property are valued, traded, insured, assessed for taxation purposes, bought, sold, used for loan collateral, used as a basis to settle court disputes... The government is the one who mandated that real estate appraisers compare like to most similar like. It's also called the sales comparison approach. 

The purpose of the sales comparison approach using matched pairs analysis is to provide the "most accurate scientific measure of value." "The major supposition of the sales comparison approach is that market value of the subject is related to comparable property values within the same market area." This is how real estate agents and sellers determine a list price for a property. It's also how agents and buyers determine an offer price for the property. This is how the tax assessor assesses your property for taxation purposes. The sales comparison approach is the most accurate method to value homes for many purposes.

Based on what has been said by the Task Force members so far I am betting that they want appraisers to use only HIGHER sold comparables from areas with more valuable homes to appraise lower valued homes in areas with a higher percentage of POC. I am assuming this will only be for government and government insured appraisals, loans for POC but am not certain if it will be for everyone in certain areas of lower valued homes. Private banks and lenders would never go for this. Everyone knows the value of property is based on three main things, location, location, location. There are clearly major problems with this approach.

The actual value of property. "The fair market value is the price a home would sell for on the open market under normal conditions." Even if the government forces appraisers to use sold comparables from homes in Beverly Hills to appraise homes in East Los Angeles that will never fool home buyers or sellers. If you want to buy, can afford to buy a $100,000 home, you will look at homes for sale around that price range in an area you like. You buy the home with $10,000 down. It appraises at $100,000 which is market value determined by an appraiser. You get sick, lose your job, sell your home or lose it in foreclosure. It sells for $100,000 and the $90,000 loan is paid off. 

Let's say instead you offered $100,000 on a home with $10,000 down payment but the appraiser said it was actually worth only $50,000. If you buy it for $50,000, you're okay. Instead you demand another appraisal using sold comps in a more valuable area maybe a beach front property to appraise a tear down shack in Pacoima. The next appraisal is $100,000. You again get sick...You couldn't sell it for more than $50,000 or were foreclosed upon. The bank just lost $40,000 which you now owe to the bank even though you have no home. Many of these loans are backed by the government. The government aka the taxpayer loses that money. The banks and government are in trouble when this happens to many people like it did during the Great Recession of 2008. We are at a home price peak so this is a major concern.

I bring up this example because this would be mortgage fraud. The appraiser and lender would be complicit. This actually happened and people were criminally convicted of fraud. One such case was Victor Noval who defrauded the US Government HUD of $60,000,000 in this scheme. They used HUD money to buy property whose value was inflated by a con artist appraiser using higher sold comparables in other superior areas and other tricks. HUD Secretary Andrew Cuomo stated in response to this crime in 1997 per the Los Angeles Times "Any con artist who tries to rip off HUD and the American taxpayer will be caught and prosecuted to the full extent of the law." The taxpayer ends up paying for any loss in government backed loans. Any program to artificially inflate the value of homes to secure government insured funding would be bank fraud and fraud against the government.  For the government itself to suggest these federal crimes is ludicrous! 

Another thing to consider is that lenders make the loans then sell them so they can use that money to make more loans. No one would buy the loans if there is no market value appraisal. No one would know what they are worth except less than the loan amount. They'd sell at a huge discount if they could be sold at all. Investors also bundle these bank and government insured loans as mortgage backed securities and sell them in the secondary market to pension funds, investment funds... Again, what are they worth? We have no idea because there is no appraisal of its real market value. Generally investors look at market value of the property, loan to value ratios, loan balances, rates, equity, payment history, loan delinquency rate ... to determine value of the investment. No one would invest in these loans if they have no idea what they are worth. That's money lost for new home loans. Now new home buyers can't buy homes. You just shot yourself in the foot.

Let's say investors invest in these loans anyway and the economy flounders. People are foreclosed upon and lose their homes which sell for less than the loan balances. The banks and government lose money on the loans. Homeowners still owe the balance of the unpaid loans. The mortgage backed securities also sell on the stock market causing the stock market to dump. This happened in the Great Recession when all those loans went south. The banks and Wall Street had to be bailed out. Government then had to develop new regulations to make sure this wouldn't happen again. Here's an idea. How about not starting new programs which set homeowners, banks, investors, taxpayers and the government up for failure from the start. 

What if POC in areas with mainly POC get a higher appraisal and then a larger loan using this new appraisal method? Do you raise their tax assessment value and taxes? That would raise the property taxes of neighbors pushing out poor and elderly people. Because home value correlates with home rent it would also raise corresponding rent of non owners who would have to move. Can wealthy people use this same new appraisal method to lower the value of their property to pay less property tax, give their spouse less in a divorce settlement or give the government less in capital gains taxes? What happens when POC get a bigger loan because of the higher appraisal but they can't afford to make the payments and lose their home? That happened during the Great Recession when home values appreciated quickly for real. While members of the Task Force stated POC would take that new make believe home equity money and invest in college educations, new businesses, health care, home improvement or retirement accounts to improve their financial situation and the community they invested in personal items instead. Our nation is still recovering from the Great Recession. This new appraisal method would open up an economic Pandora's Box while home prices and real home equity are already increasing rapidly. 

The Task Force has 180 days to come up with a real plan. I hope someone who knows something about real estate appraisal, investments, loans and the economy speaks up before then. If not, it's the home buyers, home owners, banks, government and taxpayers who will be hurt by this mess of an idea. 

#pavetaskforce #hud #realestateappraisal #bias #discrimination #value #valuation #homeloans #loans #fha #joebiden #whitehouse #marciafudge #meeting #August52021   #PropertyAppraisalandValuationEquity #PAVE #segregation #redlining #racial #occ #ftc #fdic #cfpb #fhfa #asc #susanrice 

The rest of the press release is below. It's also linked.

"The group identified near- and long-term opportunities to advance equity in home appraisals that will help narrow the racial wealth gap and reinvest in communities that have been historically left behind. The Task Force Members will work together and consult with civil rights organizations, advocacy groups, industry, and philanthropic entities to drive change.

Additionally, Task Force members agreed that the scope of the Task Force will be to:

Ensure that government oversight and industry practice further valuation equity;

Combat valuation bias through educating the consumer and training the practitioner;

Ensure equity in valuation by making available high-quality data;

Create a comprehensive approach to combating valuation bias through enforcement and other efforts.

The Task Force is chaired by Secretary Fudge and Ambassador Rice, and includes cabinet-level leaders from executive departments and additional members from independent agencies. The Task Force will deliver a final action report within 180 days.

The Task Force membership is comprised of the following officials: (I added their names)

Secretary of Housing and Urban Development (co-chair) Marcia Fudge

Assistant to the President for Domestic Policy (co-chair) Susan Rice

Director of the National Economic Council Brian Deese

Attorney General of the United States Merrick Garland

Secretary of Agriculture Tom Vilsack

Secretary of Labor Marty Walsh

Secretary of Education Miguel Cardona

Secretary of Veterans Affairs Denis McDonough

Comptroller of the Currency (OCC) Michael Hsu

Chairman of the Board of Governors of the Federal Reserve Jerome Powell

Chairman of the Federal Trade Commission (FTC) Lina Khan

Chairman of the Federal Deposit Insurance Corporation (FDIC) Jelena McWilliams

Chairman of the National Credit Union Administration and the Federal Financial Institutions Examination Council Todd M Harper

Director of the Consumer Financial Protection Bureau (CFPB) Dave Uejio

Director of the Federal Housing Finance Agency (FHFA) Sandra L Thompson

Appraisal Subcommittee (ASC) James Park

https://www.whitehouse.gov/briefing-room/statements-releases/2021/08/05/readout-of-the-first-interagency-task-force-meeting-on-property-appraisal-and-valuation-equity-pave

Mary Cummins of Animal Advocates is a wildlife rehabilitator licensed by the California Department of Fish and Game and the USDA. Mary Cummins is also a licensed real estate appraiser in Los Angeles, California.

• Mary Cummins LinkedIn
• Mary Cummins Meet up
• Animal Advocates custom Facebook name
• Mary Cummins Real Estate blog
• Animal Advocates on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins Animal Advocates Squirrel Rescue
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on Picasa web photo albums
• Mary Cummins on MySpace.com
• Mary Cummins on Google Blogger Blogspot
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK
• Mary Cummins of Animal Advocates on Google+

Google+ Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary Cummins-Cobb, Mary, Cummins, Cobb, wildlife, wild, animal, rescue, wildlife rehabilitation, wildlife rehabilitator, fish, game, los angeles, california, united states, squirrel, raccoon, fox, skunk, opossum, coyote, bobcat, manual, instructor, speaker, humane, nuisance, control, pest, trap, exclude, deter, green, non-profit, nonprofit, non, profit, ill, injured, orphaned, exhibit, exhibitor, usda, united states department of agriculture, hsus, humane society, peta, ndart, humane academy, humane officer, animal legal defense fund, animal cruelty, investigation, peace officer, animal, cruelty, abuse, neglect #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit

Alleged racial discrimination case in Oakland, California, real estate appraisal, Saleem Shaheed, Sunnyside - by Mary Cummins

Saleem Shaheed, 9821 sunnyside, oakland, california, racial, discrimination, real estate, real estate appraiser, appraiser, appraisal, fha, mary cummins, los angeles, alameda, loan, lender,

Here is another alleged case of discrimination in a real estate appraisal in Oakland, California. Saleem Shaheed purchased a Cape Cod Colonial home at 9821 Sunnyside for $430,000 Nov 26, 2019. It was listed at $475,000 for over a year and a half. It appeared to be a fixer home based on pics. At the time he got a $417,000 first loan which is a 96% loan to value ratio. He put down $23,000. Nov 2020 the home was appraised for $575K. Jan 2021 while applying for an FHA loan which has much stricter requirements for the home the value was $480K. Shaheed then ordered a third appraisal April 2021 which came in at $630,000. These values are as per Shaheed. 

Shaheed claims the second appraiser didn't give credit for the second bath. He also claims that appraiser clicked the box that said "no updates in last 15 years." Shaheed said that was incorrect because he added a new roof. A new roof is a maintenance item. It's not an update. The home per photos had roof damage and needed a new roof when he bought it, see photo below. An update, upgrade would be a fully remodeled new kitchen with new appliances and new bath of higher quality. It would include new electrical system and new plumbing. I would agree with the appraiser if the kitchen, bath were the same that I saw in the 2019 listing photos. The home does not have a legal second bath, see below. Shaheed complained, appraiser didn't change value and Shaheed filed a claim of discrimination against that appraiser's license. 

I'll first deal with the actual physical home in question. Address is 9821 Sunnyside St, Oakland, California 94603 in Alameda County parcel number 46-5463-8-2. On taxes and in public government documents it's listed as a 2 bedroom 1 bathroom home with 1,343 sf. Keep in mind Saleen Shaheed stated it's a 3 bed 1.5 bath home. An extra bedroom and bathroom makes a huge difference in value.

I got comments doubting the bed, bath count. Here is an ad for the house from 1967. It's a two bed, one bath home. "2 plus" means two legal bedrooms. 

The top image came from the MLS listing. It was listed at $475,000 from at least March 12, 2018 to November 26, 2019 with agent Jasmine on the MLS. It's listed as a 2 bed, 1 bath home with 1,343 sf. Then the agent made a video where she states it's 3 beds, 2 baths with 1,609 sf. Screen shot from the video below. The agent Jasmine Sunkara is a liar which is probably why she removed her website below. She listed the real bed, bath count and size on the MLS. Based on government records this home is legally 2 beds and 1 bath. That appears to be the main issue in this case. Saleem Shaheed bought a 2 bed, 1 bath home which he is now trying to pass off as a legal 3 bed, 1.5 bath home in order to get a higher valuation. The home is also across the street from an elementary school which negatively affects value compared to homes not next to an elementary school. 

Saleem Shaheed, 9821 sunnyside, oakland, california, racial, discrimination, real estate, real estate appraiser, appraiser, appraisal, fha, mary cummins, los angeles, alameda, loan, lender,

I looked at the pics of the bedrooms in the video. They are not all bedrooms. Below are the pics of the alleged bedrooms. Two top pics are of the same bedroom. 

A legal bedroom must have a real closet and not just an armoire or clothing rod on a wall if it's not a very old home which was built without one. A legal habitable room must be legal minimum height in order to be included in the total gross living area. While older homes with sloped walls on the sides are common the angled area where it slopes under six feet is not included in the gross living area. 

You'll notice the home is listed as 1.5 floors. It's not two stories. The second floor is not a full floor with full height wall to wall. Notice the dormer windows. Notice the angled, sloped walls in rooms. A legal room must have a heat source connected to the main part of the home and should have insulated walls and ceilings. Attics generally don't. Below is a pic of the side view of the home. You can see it's not a full two story home. The two bedrooms are on top on either side of the "2nd" floor. The main part of the first floor of the home is about 23' x 32' (762') based on Google measure minus average sized roof eaves. The 2nd fl could be about 581'. You can't add area of the stairs on the second floor. 2nd fl definitely not the same size as the first floor. The rear extended part of the home looks like an unpermitted enclosed porch maybe. The one car garage is on the other side of the home. 

I'm assuming the green room is also considered a bedroom. Notice the odd closet with a window in it. It almost looks like part of the second floor was an attic-like area that was converted. See the little low door that goes to a storage area. That area in there is probably angled. 

The last turquoise blue pic is not a bedroom. That is not a third bedroom. The walls are angled, roof is low and there is barely any walking floor space. I'm going off the video and listing. 

I saw only one pic of a bathroom in the video. It was just a close shot of a toilet and window so I'm assuming the bathroom is small. Just found a pic of the full bathroom. It's the main bathroom.

I don't know what the full or half bath looks like. As the extra bed is not legal I'm sure the extra half bath isn't legal either. The problem with non legal rooms built without permits and not to code is that Building and Safety could order them removed at any time if they are reported. If you are the bank you want to make sure the loan is covered by the value of the home. A legal 2 bed 1 bath home is worth less than a legal 3 bed 2 bath home even if they are the same size. A legal 2 bed 1 bath home is worth about the same as a 3 bed 2 bath home where the extra bed and bath are not legal. Anyone can report the owner today and he'll probably have to rip out the extra bed and bath. Please, don't report the guy. 

In every day appraising we see unpermitted additions especially in areas with more affordable homes. We generally note whether or not they were built to code and built in a workmanlike manner. We also mention if they pose a health and safety hazard and include photos. Some lenders allow the appraiser to count them as beds, baths and some do not. One thing to consider is if you were offered a legal 3 bed, 2 bath home and a legal 2 bed, 1 bath home with unpermitted extra bed and bath, which home would you choose for the same price? You'd choose the legal one because someone could report the unpermitted rooms and you'd have to remove them. Clearly the home with legal beds, baths is worth more. 

Just for a wide range of values below are the three main robot appraisal values. The values are based on a mathematical formula which is the same as what real estate appraisers use. We search homes +/- 15% legal gross living area within a half a mile from the subject sold within the last 3 months or max six months if there are no recent comparable homes sold. We then choose the most similar comparables based on size, bed/bath count, amenities, condition, view... 

Everyone knows garbage in, garbage out (GIGO) with computer software. Flawed, or nonsense (garbage) input data produces nonsense output. That's what we have here with our robot values. The first two went by the false MLS information stating it's 3 bed, 2 bath. The last one is based on the tax data and is 2 bed, 1 bath. The difference today between a 3 bed, 2 bath home and a 2 bed, 1 bath home is about $130,000. These values are as of June 15, 2021 which is later than any of the appraisals. There are eight months between the first and third appraisal. I'm sure the value increased significantly in the last eight months. 

Zestimate/Trulia $666K range $619K - $764K 3+2 1343 sf

Redfn $669K 3 + 1.5 1370 sf

Real AVM $533K range $469,216 - $597,184 shows as 2 bed + 1 1343

Back to the three appraisals, i.e. November 2020 $575K, January 2021 $480K FHA appraisal, April 2021 $630,000. Shaheed has a problem with the six month old $480K appraisal which was for an FHA loan. FHA loans are very restrictive on the type and condition of homes on which they will lend. They would count legal beds, baths. The FHA appraiser did not give credit to the second bath which could be proper based on condition, permits. There can be no health, safety issues or major code violations. A regular loan might allow an appraiser to consider unpermitted beds, baths. I obviously have not seen the home. I don't know the condition or if it's changed. Shaheed states he added a new roof and redid the kids' bedrooms. The roof is a maintenance issue. Redoing bedrooms doesn't add that much value to the home. The pics of the alleged bedrooms are pretty funky. 

There is one issue most homeowners don't understand. Most underwriters, lenders will not allow the final appraised value to be higher than the highest recent sales price of a similar home in the area. It's possible there were no recent higher sales of a similar 2 bed, 1 bath home when the 2nd appraisal came in at $480,000. There are few homes on the market so there aren't that many sales. Maybe most homes in the area are newer legal 3 bed, 2 bath homes. It's also very possible that there were some recent higher sales of 3 bed, 2 bath homes when the 1st and 3rd appraisals were done. I haven't seen the appraisals. 

Based on the legal bed, bath count the second appraisal would have been within the range of value for the home at that time for an FHA appraisal. Based on 3 beds, 2 baths the first and third appraisals would have been within the range of value for the home at the time of those appraisals. That would appear to be an 8% appreciation within eight months between appraisals one and three. That sounds about right for the market. Home values have been rising quickly in that area. Cheaper areas such as Oakland have seen a larger increase. People can't afford the nicer areas so they are moving to Oakland where homes are more affordable. That is quickly driving the price up sky high. Because I haven't seen the home I can't get more specific about the value of the home. I can say there are issues with the home that would cause a wider range of values, namely the legal bed, bath count and condition. 

A last issue is that most loans are declined due to credit worthiness of the borrower, their income, assets, debts and not the appraisal. It's up to the lender to approve the loan as a package comprised of the borrower and the collateral. The appraiser has no say in the loan approval. If the last appraisal was done April 2021, any loan should have closed by now. Shaheed stated he still doesn't have a loan. Shaheed said the value of the last appraisal was "good" so one can only surmise that the borrower is the issue. If he goes ahead with the loan now, he now may have to have the appraisal updated. 

*Disclaimer. I haven't seen any of the appraisals. I do review appraisals for banks. I am not appraising this home. I haven't seen this home in person. 

**All real estate appraisals completed on the 1004 form state the appraisal is only for the use of the client. The client is the AMC or lender. The appraisal cannot be used for any other purpose by other parties. The borrower is not the client or owner of the appraisal. The purpose of the appraisal is to make sure there is sufficient equity in the property to cover the loan balance and costs to foreclose the property by the lender. The borrower is entitled to look at the appraisal. The borrower cannot use the appraisal for their own use. 

Below is the video tour of the home. Agent removed one version of it within an hour of me posting the article. I saved a copy.
 

https://www.facebook.com/watch/?v=1856674971289556

Below is the original article.

https://abc7news.com/home-appraisal-discrimination-oakland-homeowner-beats-low-housing-sunnyside/10790373/

Original real estate agent's website which was removed.

http://jasminesellsrealestate.com/

Jasmine Sunkara 916.501.3393 #calbre#01855557 #NMLS#112033

Photo of roof before sale. It needed a new roof. 

Photo of living room. You can see water damage to the wall most likely from the roof damage.

Kitchen.

Government city, county, state property record for subject. 

I just checked permits. There was no permit to add a bedroom or bathroom. There were two permits the current owner pulled to add solar but it was never completed. There was no permit for a new roof. You need a permit to replace the roof. They need to make sure people use roofing material and application methods which are up to code and fire proof. 

08/12/2020

Permit Inactive

SE2000661

Solar Electric Panels

9821 SUNNYSIDE ST, Oakland CA 94603

Install roof-mounted 3.30 kW PV solar system with 10 modules.

08/12/2020

Permit Inactive

RE2001806

Residential Electrical - Alteration

9821 SUNNYSIDE ST, Oakland CA 94603

Install 13.5 kWh Energy Storage system, 225 amp Main service panel, load center, and backup gateway.

2019 the sewer and sidewalk were repaired. 

Mary Cummins of Animal Advocates is a wildlife rehabilitator licensed by the

Mary Cummins of Animal Advocates is a wildlife rehabilitator licensed by the California Department of Fish and Game and the USDA. Mary Cummins is also a licensed real estate appraiser in Los Angeles, California.

• Mary Cummins LinkedIn
• Mary Cummins Meet up
• Animal Advocates custom Facebook name
• Mary Cummins Real Estate blog
• Animal Advocates on Google maps
• Mary Cummins of Animal Advocates
• Mary Cummins biography resume short
• Mary Cummins Real Estate Services
• Animal Advocates fan page at Facebook.com
• Mary Cummins Animal Advocates Squirrel Rescue
• Mary Cummins Animal Advocates on Flickr photos
• Mary Cummins Animal Advocates on Twitter.com
• Mary Cummins on Picasa web photo albums
• Mary Cummins on MySpace.com
• Mary Cummins on Google Blogger Blogspot
• Mary Cummins on YouTube.com videos
• Mary Cummins of Animal Advocates on Classmates
• Mary Cummins on VK
• Mary Cummins of Animal Advocates on Google+

Google+ Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary Cummins-Cobb, Mary, Cummins, Cobb, wildlife, wild, animal, rescue, wildlife rehabilitation, wildlife rehabilitator, fish, game, los angeles, california, united states, squirrel, raccoon, fox, skunk, opossum, coyote, bobcat, manual, instructor, speaker, humane, nuisance, control, pest, trap, exclude, deter, green, non-profit, nonprofit, non, profit, ill, injured, orphaned, exhibit, exhibitor, usda, united states department of agriculture, hsus, humane society, peta, ndart, humane academy, humane officer, animal legal defense fund, animal cruelty, investigation, peace officer, animal, cruelty, abuse, neglect #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit