I left my Housing Notes readers with an extensive look at Extreme Ironing last month. Now that I’m back from a ridiculously long vacation, I wanted to show you that my time away from work hasn’t changed me. Hence, I’m stepping into some extreme wheelbarrowing.
Next week I’ll be back to speed with more content and a bunch of our own housing market research but for now…
But I digress…
Calculated Risk: The Seller’s Strike
In most housing downturns, as sales decline from an external event like rising mortgage rates, listing inventory rises relative to previous periods. Yet in this cycle, new listing inventory growth is cooling.
The must-read Calculated Risk site calls this a Seller’s Strike.
The thinking is that would-be sellers are reluctant to sell because they will see a much higher mortgage payment. Afterall, 30-year mortgage rates were 3.1% at the end of December and are nearly double that now.
The Real Deal on Instagram – Real Estate Holdings of the Royal Family
New in the Real Estate Lexicon: “Under Demolished”
— Jonathan Miller (@jonathanmiller) September 12, 2022
My favorite charts of the week of our own making
My favorite charts of the week made by others
— Simon Kuestenmacher (@simongerman600) September 4, 2022
It's odd that home sales aren't public record in every state.
I'd really like to see data in ID, MT, TX, and UT right now. pic.twitter.com/QV0NeK9p5O
— Lance Lambert (@NewsLambert) September 13, 2022
Len Kiefer‘s Chart Handiwork
Upcoming Speaking Events
Thursday 9-29-22 9:00am ET IN PERSON AREAA
(For earlier appraisal industry commentary, visit my old clunky REIC site.)
American Banker Exposes The Deep Structural Problems Within TAF
Last spring, a reporter at American Banker I know reached out to me based on my running TAF commentary in these Housing Notes. I was interviewed for the piece and made suggestions on who to speak with and the problems that TAF has perpetuated. The author did a terrific job with this complex topic.
Here’s the AB piece with the accompanying podcast:
Home appraisers are fed up with how their industry is run [American Banker]
The podcast intro was led by my firm’s chief appraiser, so the author could get a sense of what an appraisal represents. My friend and appraiser, Lori Noble of West Virginia, was featured in both the article and the podcast on the topic of the West Virginia Board’s self-dealing, led by Dean Dawson. Here it is:
There will be lots of new insights on the TAF front coming over the next several weeks.
AI Leadership Needs To Take A Refresher Ethics Course On Conflict Of Interest
Former AI president Rodman Schley is a really nice guy who led the rekindled efforts on the topic of diversity for AI – probably hoping to establish his institutional legacy on those achievements.
However, I was really disappointed to learn Rodman had AI CEO Jim Amorin as an advisor on his newly established EVOLVEX CAPITAL venture. Members that have shared this with me are PISSED at the breach of ethics here. Why? Rodman is the chairman of the AI Compensation committee who specifically determines Jim Amorin’s compensation and bonuses. This is highly unethical but it does fall within the normalized corrupt culture that FOJ’s live by to get choice teaching assignments and chairmanships.
Oh, and the CFO of AI is also on the board of Evolvex.
AI’s Board of Directors is supposed to be in charge and the employees such as JA report to the board. Yet as everyone knows the BOD reports to JA. You gotta admit, JA knows how to make an organization his monarchy.
You can’t make this stuff up.
HUD Is Making An Extensive Investigation Of TAF Right Now
HUD probe into valuation bias focuses on Appraisal Foundation [American Banker]
This is the heart of TAF’s problem:
As a private entity, the foundation is not subject to the federal Administrative Procedure Act, which requires a lengthy and deliberate process for publicly vetting potential new regulations. Instead, it uses an “exposure draft” process that some in the profession feel draws insufficient input from outside groups, including those focused on issues of race and discrimination.
As I’ve said many times, only until recently did TAF use outside counsel to review their policies but still don’t rely on policy experts. This has caused TAF to retract and restate many policies over and over again. Plus it helps substantiate the two year update cycle as a necessary option for this incompetence – the result is wasteful expense and damage to the appraisal industry for the confusion they perpetually cause.
Law Firm That Represents TAF, Also Represents Plaintiffs Suing Appraiser For Fair Housing Violations
I find it odd, but consistent that the law firm TAF uses, RELMAN COLFAX, PLLC, to which president Dave Bunton repeatedly refers to as “preeminent” (I’ll assume they are) is representing a client suing an appraiser. I am not speaking to the merits of the case here.
Its just that the TAF hiring of law firm is consistent with TAF having Mountain State Justice, a legal advocacy group that sues appraisers for a living using appraiser board members of the West Virgina RE Appraiser Board such as Dean Dawson, was named to TAF’s BOT! Thankfully, their director was not brought back for a second term on BOT.
Here is the affidavit for the case in UNITED STATES DISTRICT COURT, DISTRICT OF MARYLAND:
Nathan Connolly and Shani Mott, Plaintiffs,
Shane Lanham, 20/20 Valuations, LLC, and loanDepot.com, LLC, Defendants.
Defendants Lanham and 20/20 Valuations discriminated against Plaintiffs by
dramatically undervaluing their home in an appraisal because of Plaintiffs’ race and their home’s
location adjacent to a Black census block, notwithstanding that it is also located within
Homeland, an affluent, mostly white neighborhood. Defendant loanDepot discriminated against
Plaintiffs by knowingly relying on that appraisal to deny Plaintiffs a refinance loan and
retaliating when Plaintiffs explained why the appraisal was discriminatory.
I know nothing about this market or the specifics of this case but after reading the document, which I encourage all of my appraiser readers to do, I seem to have more questions than answers.
Voice of Appraisal E256 Everyone Thinks We’re Crazy!
My friend Phil Crawford explains the insanity of industry right now in a way only Phil can deliver.
Real Estate Rumble Podcast: Andrew Turley, Appraiser & RAC Member Adds Clarity On What Happens Backstage
Andrew and I are members of RAC, an appraisal organization comprised of the best residential expertise in the industry. I’m writing this post from the annual RAC conference in Plano, Texas, an event I always look forward too. Andrew is a builder and real estate appraiser.
OFT (One Final Thought)
The followingi seems more practical than Extreme Wheelbarrowing!
Brilliant Idea #1
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Brilliant Idea #2
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See you next week.
Reads, Listens and Visuals I Enjoyed
- Compass Eliminates More Jobs as Real Estate Brokerage Seeks to Cut Costs [Bloomberg]
- Charting the Global Economy: Inflation Winds Keep Blowing Strong [Bloomberg]
- A New Set of Housing Winners and Losers Is Emerging [Bloomberg]
- Mortgage Rates [FreddieMac]
- Infographic: Refinance Boom Dies Down as Mortgage Rates Surge [Statista]
- Will Someone Pay $250 Million to Live Atop the World’s Tallest Condo Tower? The Developer Thinks So. [Wall Street Journal]
- For First Time, Opendoor Selling Homes for a Loss [Mike DelPrete – Real Estate Tech Strategist]
My New Content, Research and Mentions
- Surveillance: Fed Tightening with Jones [Bloomberg Podcast]
- There Are Still Bidding Wars Now In Housing: Miller [The Global Herald]
- Housing: Priced-out homebuyers add pressure to skyrocketing rents [AOL]
- Mayor Eric Adams is taking concerns from tech executives over the city`s crime and high rents head-on, encouraging them to keep their business in the Big [Bolly Inside]
- Housing: Priced-out homebuyers add pressure to skyrocketing rents [Yahoo Finance]
- Eric Adams Appeals to Tech Execs to Stay in NYC [The Real Deal]
- Veteran housing adviser to Mayor Adams leaving for advocacy job amid NYC affordability crisis [NY Daily News]
Recently Published Elliman Market Reports
- Elliman Report: Colorado New Signed Contracts 7-2022 [Miller Samuel]
- Elliman Report: Manhattan, Brooklyn & Queens Rentals 7-2022 [Miller Samuel]
- Elliman Report: California New Signed Contracts 7-2022 [Miller Samuel]
- Elliman Report: Normandy Isles/Normandy Shores New Signed Contracts 7-2022 [Miller Samuel]
- Elliman Report: Florida New Signed Contracts 7-2022 [Miller Samuel]
- Elliman Report: New York New Signed Contracts 7-2022 [Miller Samuel]
- Elliman Report: San Diego County Sales 2Q 2022 [Miller Samuel]
- Elliman Report: Orange County Sales 2Q 2022 [Miller Samuel]
- Elliman Report: Malibu + Malibu Beach Sales 2Q 2022 [Miller Samuel]
- Elliman Report: Los Angeles Sales 2Q 2022 [Miller Samuel]
Appraisal Related Reads
- Choosing comps in a changing market
- Appraisal Vendor CEO Resigns, Some Appraisers Waiting to be Paid [National Mortgage News]