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In this Sunday’s New York Times Real Estate Section (online now), the Calculator column featured some data trends I’ve gathered during two significant prior housing market events: What Can 9/11 and the Great Recession Tell Us About Coronavirus Recovery?
Tags: New York Times, 9/11, financial crisis, Lehman Brothers Bankruptcy, NYT Real Estate, Michael Kolomatsky, racism, diversity
My friend and appraisal colleague Ryan Lundquist and I authored a petition on change.org to point out the growing wreckless behavior that is enveloping the mortgage process.
There’s a proposal from the FDIC, Federal Reserve, and Treasury Department not to require appraisals for some mortgages under $400,000.
As we say in the petition, this change can impact several groups in particular: consumers, the taxpayers, the housing market and appraisers.
One group not explicitly mentioned in the petition but impacted down the road are real estate agents and brokers. Currently, 12% of mortgages that flow through the GSE (Fannie Mae and Freddie Mac account for 78% of residential mortgages right now) will have their appraisals waived. Those are “PiW” loans or have a “Property Inspection Waiver.” My good friend and appraiser colleague Phil Crawford says on his radio show “Voice of Appraisal” says the acronym stands for “Pissing In Wind” which is more accurate. If the buyer realizes they overpaid for the property, the agents are now the professionals with the bullseye on their back. Liability insurers are already talking about a new target when things go south.
Years ago and again this morning, I heard a real estate agent say – what do we need you (appraisers) for? “The seller and the buyer determined the market value by agreeing on the price.” The problem with this logic is the buyer may not be fully informed (i.e., from an out of market area) and will also mortgage fraud supercharged. Ever heard of straw buyers? Agents must remember that they perceived as biased even with the best intentions and the best ethics because they are paid only if the deal closes. When something goes wrong, they are completely exposed.
The direction that was taken by regulators relies heavily on AVMs (Think Zillow’s Zestimate which is not within 4.3% of the actual value 50% of the time) and “hybrid appraisers” (which removes the appraiser from the actual inspection of properties) to develop a value opinion. The inspection of the property, when done, will rely on non-licensed individuals to fill out a checklist and give an appraiser at a desk the information without any standardization, direct contact or assurance the inspector knows what they are doing. I’ve heard of fees as low as $8 to do the inspection and $78 for the appraiser. As far as I can tell, a full appraisal (inspection and analysis) cost can represent as little as a hundredth of a percent of a purchase transaction.
This petition is for everyone to sign, not just appraisers. Please sign and help bring attention to a pattern we just lived through in the financial crisis. It’s happening again.
Please make your voice known, read about and hopefully sign the petition below:
PETITION: Remember liar loans of a decade ago? Those same people want to do away with appraisers.
Tags: FDIC, Petition, Federal Reserve, Zestimate, US Treasury, financial crisis, PIW, appraisal waiver, Ryan Lundquist, AVMs
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Fairfield County, CT is one of the more recent editions to our Elliman Report series. Greenwich, CT as a submarket has proven to be a market still strongly linked to the heady days before the collapse of Lehman Brothers in 2008 and the beginning of the financial crisis. There remain many owners of high end homes purchased a decade ago that remain value-anchored to those days of yore.
I took a look at the last 15 years of residential sales, measuring the amount of time that passed from a home’s prior renovation to sale. From the late 1990s to Lehman, there was a compression of time from renovation to eventual sale, reflective of the speculative conditions leading up to Lehman. Reno a home, then sell it. During those days, business cards passed out by doctors and lawyers at Greenwich cocktail parties were either “hedge fund manager” or “developer.” Not so much anymore.
Subsequent to Lehman, the late 1990s pattern that preceded the U.S. housing bubble returned by 2010 and has remained remarkably stable since.
Tags: financial crisis, Lehman Brothers Bankruptcy
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It’s time to share my Three Cents Worth (3CW) on Curbed Hamptons, at the intersection of sand dunes and real estate in the East End of Long Island, NY.
Check out my 3CW column on @CurbedHamptons:
Now that we’ve crossed over into June, I thought I’d illustrate the price trend relationship between the Hamptons and Manhattan. The former seeing a majority of single family sales and many second home purchases. The latter with a housing market of 98% apartments and single family family sales are a rounding error. Despite the differences in their housing stock, their behavior in terms of price trends has been similar over the past decade…
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My latest Three Cents Worth column: Three Cents Worth: Comparing Price Trends in the Hamptons and Manhattan [Curbed]
Three Cents Worth Archive Curbed NY
Three Cents Worth Archive Curbed DC
Three Cents Worth Archive Curbed Miami
Three Cents Worth Archive Curbed Hamptons
Three Cents Worth Archive Curbed LA
Three Cents Worth Archive Curbed Ski
Tags: Three Cents Worth, Curbed Hamptons, Wall Street Bonus, 3CW, foreign buyers, financial crisis, apartments, single family, sand
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It’s time to share my Three Cents Worth (3CW) on Curbed Miami, at the intersection of neighborhood and real estate in the Magic City. And I’m taking notes on the beach.
Check out my 3CW column on @CurbedMiami:
As we make our way through the second quarter (more than halfway!), I took a look at some trends extracted from the first quarter reports we prepare for Douglas Elliman. I went all out and created a four charter that addresses a number of issues born out of the financial crisis that still touch the current market..
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My latest Three Cents Worth column: Three Cents Worth: Miami Drill Down: Picking Up the Scraps of the Financial Crisis [Curbed]
Three Cents Worth Archive Curbed NY
Three Cents Worth Archive Curbed DC
Three Cents Worth Archive Curbed Miami
Three Cents Worth Archive Curbed Hamptons
Three Cents Worth Archive Curbed LA
Three Cents Worth Archive Curbed Ski
Tags: Three Cents Worth, Curbed Miami, 3CW, financial crisis
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Read my latest Bloomberg View column Credit Crunch Lives on in Housing. Please join the conversation over at Bloomberg View. Here’s an excerpt…
Don’t be fooled by low mortgages rates, which once again are below 4 percent: Credit for buying a home or refinancing an existing mortgage has almost never been tougher to get.
My Bloomberg View Column Directory
My Bloomberg View RSS feed.
Tags: mortgage interest rates, financial crisis, CoreLogic, credit crunch, Housing Credit Index, Mortgage
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Read my latest Bloomberg View column Only Brooklyn Is Over the City’s Housing Bust. Please join the conversation over at Bloomberg View. Here’s an excerpt…
Housing prices in four of New York’s five boroughs still haven’t reached their pre-crash highs. The outlier? Brooklyn.
Housing prices in Brooklyn now are more than 8 percent above the peak reached in 2007. The other four boroughs, meanwhile, are all more than 10 percent below their highs, with the Bronx still down by almost a quarter….
My Bloomberg View Column Directory
My Bloomberg View RSS feed.
Tags: median sales price, financial crisis
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Read my latest Bloomberg View column When $7 Million Is Average for Manhattan. Please join the conversation over at Bloomberg View. Here’s an excerpt…
It’s pretty much universal knowledge that Manhattan real estate is expensive. What isn’t so well known is what’s happening at the top of the market: Price increases have been crazy.
Ever since the financial crisis, housing prices for the most-expensive 10 percent of the Manhattan market have increased more than 15 percent. Compare that with the modest 2.5 percent gain for the remaining 90 percent of the market….
My Bloomberg View Column Directory
My Bloomberg View RSS feed.
Tags: financial crisis
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Jonathan Miller is President and CEO of Miller Samuel Inc., a real estate appraisal and consulting firm he co-founded in 1986. He is a state-certified real estate appraiser in New York and Connecticut, performing court testimony as an expert witness in various local, state and federal courts. He holds the Counselors of Real Estate (CRE) and Certified Relocation Professional (CRP) designations. He is an Appraiser “A” Member of the Real Estate Board of New York and a member of Relocation Appraisers and Consultants, Inc.
Learn More...
You'll be able to choose from an array of robust housing metrics compiled using research developed during the preparation of our market report series. Expanded significantly from prior offerings, use this resource to build charts and custom data tables or leverage your own information for more powerful research and presentations.
In the meantime, here is a small sample of the aggregated data we will provide.
Forbes ('20-)
Appraisersblogs ('17-)
'Three Cents Worth' column 3CW ('05-'16)
When Curbed was acquired by Vox, my eleven years of 3CW chart art and column links were broken on Curbed NY, Curbed DC, Curbed Miami, Curbed Hamptons, Curbed LA, and Curbed Ski.
Many of my 3CW charts can be found here:
Curbed 3CW Full Chart Archive
Op-ed column ('14-'15)
'Economic Spotlight column ('03-'09)
New York Times experiment ('08-09')
Huffington Post (09')
Favorite "How to Value" Posts
Recent Comments on Matrix