Can You Talk to an Appraiser

Forty-seven percent of real estate professionals say they have had a transaction fall through due to a problem in the appraisal process, according to the National Association of REALTORS®’ 2022 Appraisal Survey. The most common culprits are an appraised value coming in lower than the contract price and a perception that the appraiser lacks knowledge of a neighborhood or uses inappropriate comps, the survey shows.

The survey of more than 600 appraisers and 2,500 residential real estate pros was conducted in May.

Yet, many real estate professionals say they are fearful of talking to appraisers and try to keep their distance from this part of the transaction. Twenty-one percent say they interact with appraisers only when there is an issue with the value; 19% say they don’t interact with appraisers at all. Of those who don’t interact, most say they avoid contact because they think they’re not legally allowed to speak to the appraiser, or they’re concerned that the interaction might lead to appraisal bias.

However, “regulations allow real estate agents, or other persons with an interest in the real estate transaction, to communicate with the appraiser and provide additional property information, including a copy of the sales contract,” according to NAR’s FAQs on the residential appraisal process.

Real estate pros who do interact with appraisers say they try to provide additional information to help them in their valuation, the survey shows. These pros also may meet with the appraiser onsite to provide comps, a list of improvements made to the property or information on multiple offers.

©National Association of REALTORS®
Reprinted with permission

Appraisers Say ‘We Have Targets on Our Backs’

How professionals are managing the biggest obstacles to the home valuation process.

From allegations of appraiser bias in the home valuation process to new controversial methods of conducting an appraisal, the profession is under intensifying scrutiny—and a new National Association of REALTORS® survey offers insights into these challenges.

Many appraisers express dissatisfaction with the impact industry regulations and appraisal management companies are having on their business, saying these issues are delaying their work, according to NAR’s 2022 Appraisal Survey. Appraisers also are facing more lawsuits claiming racial bias in undervalued homes, which adds to their stress on the job. “We currently have big targets on our backs,” writes one survey respondent who is an appraiser. “We are being called racists left and right in an attempt to destroy the appraiser.”

The survey of more than 600 appraisers and 2,500 residential real estate pros was conducted in May.

Only 3% of real estate professionals report witnessing or experiencing discrimination in the appraisal process, the NAR survey shows. However, 16% say they believe such discrimination exists. A property owner’s race or color is the most likely catalyst for appraisal bias, survey respondents say. “An appraiser valued a home at one-third less than the actual value after meeting the homeowners,” one respondent writes.

Appraisers also say they’re feeling the pressure from recent lawsuits, with one respondent commenting: “We are the most policed player in the mortgage transaction, and no one could get away with long-term discrimination without being discovered and terminated from the profession. The comparables do not lie. We are reporters of the market statistics—nothing more.”

Top Appraisal Challenges

Accusations of appraisal bias are not the biggest issue appraisers are reporting, even though it has become a larger issue in the public eye. The number one concern for appraisers, the survey shows, is appraisal management companies that are disrupting the industry. AMCs work with lenders and appraisers to order, track and deliver appraisal reports. Survey respondents complain that AMCs can delay appraisals for days or even weeks as lenders shop for appraisers with the lowest fees or quickest turnaround times.

Appraisers also report the following challenges facing the profession.

The majority of appraisals continue to be conducted in person, but desktop and drive-by appraisals—which don’t require an appraiser to enter the home—are becoming more frequent options, the survey shows. Yet, 63% of appraisers surveyed admit they are “very uncomfortable” with desktop appraisals and many other alternative valuation methods that are completed remotely.

©National Association of REALTORS®
Reprinted with permission

Netflix’s Next Real Estate Star on the Future of the Luxury Market

Mauricio Umansky, husband of “Real Housewives” star Kyle Richards, has his own show following his brokerage, The Agency. He offers a peek inside the occu-soap “Buying Beverly Hills” and makes predictions for high-end housing in 2023.

Mauricio Umansky’s The Agency(link is external) caters to the rich and famous. As CEO and founder of the billion-dollar brokerage, Umansky has built a reputation around flashy marketing, using storytelling techniques, videos and high-tech tools to garner attention for his A-list properties. His brokerage, which has been featured on several television shows, including “Million Dollar Listing Los Angeles” and “The Real Housewives of Beverly Hills,” is now the subject of a new Netflix series, “Buying Beverly Hills(link is external).” The show is set to premiere this fall.

Umansky reportedly holds the distinction of selling the most homes in the country priced above $20 million. He has represented some of the most noteworthy properties over the years, including the first house in Los Angeles to sell above the $100 million mark as well as well-known residences belonging to Michael Jackson, Prince and the Walt Disney estate. He also has represented major brands like The Ritz-Carlton.

Since its inception in 2011, The Agency has grown to more than 50 corporately owned and franchised offices and nearly 1,000 agents across the U.S., Canada, Mexico and the Caribbean. REALTOR® Magazine recently caught up with Umansky to talk about what lies ahead for the housing market and his new buzzed-about Netflix series.

Q: What do you believe is in store for the luxury real estate market for 2023? Is the high-end market starting to slow like we’re seeing in the lower price points?

A: I believe we are beginning to see real estate markets across the country normalize. It’s important not to compare our current market to 2020 or 2021 because those years were an anomaly, and truthfully, the rapid pace of the market was unsustainable for the long term. The pandemic will likely be one of the most important events we’ll experience in our lifetime, when the home evolved even more into a personal sanctuary. So, it is impossible to compare this year’s market activity and predict 2023 in relation to these events.

I do anticipate that we will return to a new normal, yet the COVID experience is still behind today’s decision-making. Real estate will always be a sound investment and a safe bet when global markets are in upheaval and a recession is looming. Despite the market shifting, there is still so much global wealth. As the market slowed over these past few months, we finally began to see a return to real estate seasonality, which we have not experienced in the past two years.

I think a lot of buyers are still ready to buy and are collectively waiting for the next move once markets have stabilized. And, of course, now buyers can finally purchase a property at more realistic pricing without being completely outbid. As far as inventory, there’s definitely is still a dearth, especially in desirable markets and neighborhoods. I anticipate more inventory coming to the market in the coming months, but I predict it will still be slim across the board.

Do you notice any buyer or seller trends emerging that you believe could be even bigger in 2023?

People continue to crave outdoor space and desire turnkey living. They want more white palettes—simple and minimalistic—as more people gravitate away from heavy colors. When seeking a new home, buyers want more flexibility in a floor plan so they can use rooms for different functions, such as a secondary office, guest room for in-laws or playroom for kids. People also are prioritizing homes with accessory dwelling units that they can rent out for additional income or use for multiple purposes as needed by their families. Privacy and security also tend to be top of mind for buyers seeking a new home.

The Agency has long been known for its tech and marketing innovations. What technology lately has you the most excited for its potential in real estate?

In May, we announced The Agency’s acquisition of the tech-powered brokerage Triplemint, which is now The Agency New York. In tandem with the merger, The Agency has launched a new website and creative center for its agents, which further positions the brokerage for strategic and sustainable growth across the Northeast and around the world.

The Agency’s new website features enhanced functionality, making it easier for consumers to search and share listings and agents to receive client insights. The first phase includes new features such as a powerful universal property search, saved searches and property portfolios, tour sheets, expanded agent profiles, advanced lead generation and a redesigned, SEO-optimized blog.

The Agency Creative Center is the firm’s new fully accessible online marketing platform, home to its comprehensive marketing toolkit. The platform gives agents access to create everything they need to market themselves and their properties across print and digital channels. The Agency’s Creative Center offers more avenues and streamlined processes for collaborating, marketing asset creation, printing, and project management.

How will the acquisition of Triplemint help your company’s expansion efforts?

We’re thrilled Triplemint is now The Agency New York and to offer our agents an improved website and a new creative marketing suite as we continue to focus on streamlining our services with an emphasis on quality over quantity. We plan to continue our expansion using both our very talented and productive agents and Triplemint’s proprietary technology.

The Agency will continue to develop and enhance its existing full suite of cutting-edge tools, now powered by Triplemint’s predictive analytics and machine learning. These tools improve the agent experience and will enhance real-time communication between agents and clients while increasing productivity; automatically track the market and produce customized, real-time alerts; and foster lead generation to automatically capture, vet and convert leads.

Tell us about your new Netflix show, “Buying Beverly Hills.” What can we expect from the first season?

As the show’s slogan says: “We said no ass—-s. But we never said no drama.” The new real estate “occu-soap” follows the agents and clients with The Agency. People will be able to see my role as CEO, working alongside my daughters, Farrah Brittany and Alexia Umansky, and our talented group of agents. The show highlights the high-stakes world of luxury real estate in Los Angeles. Beverly Hills is one of the most sought-after ultra-high-end markets in the world. This show provides a look inside the deals and listings of our agents, both newer and experienced. One of the standout elements of “Buying Beverly Hills” is the crew of newer agents we have working alongside the veteran agents. There is a lot of beautiful real estate, and we are also showing what it’s like trying to break into the industry with the learning curves, the challenges, etc. Viewers also will be able to follow the market trends our agents navigate through the season.

©National Association of REALTORS®
Reprinted with permission

Pros Show Community Pride During REALTOR® Volunteer Days

Real estate professionals across the country are joining in a week-long nationwide effort through Sunday to give back to their communities. During REALTOR® Volunteer Days, which is part of the REALTORS® Are Good Neighbors program, the National Association of REALTORS® is urging associations, brokerages, and members across the country to organize and participate in local volunteer activities, such as sponsoring donation drives, volunteering at local nonprofits, or finding other ways to serve their neighbors.

“Imagine the impact of 1.5 million REALTORS® in every city and town across the U.S. giving back,” says Sara Geimer, manager of NAR’s Good Neighbor Awards. “With our numbers and giving spirit, REALTORS® have so much power to make the world a better place.”

Numerous events have been planned for the 2022 REALTOR® Volunteer Days, including drives for food banks, Habitat for Humanity builds, dog shelters, and neighborhood cleanups. For example, the Mississippi REALTORS® announced it is collecting food donations for Shower Power, a service to the homeless population that was founded in 2019 by Mississippi REALTOR® Teresa Renkenberger. Shower Power offers a truck where homeless people can shower, get a meal, and receive other donations.

Also, as part of the 2022 REALTOR® Volunteer Days, the Knoxville Area Association of REALTORS® is holding several events, such as volunteering at a local boat festival, filling up backpacks with school supplies, assisting at dog shelters, distributing food to the homeless, taking part in community cleanup events, and a Habitat for Humanity event.

The Kaua’i Board of REALTORS® is holding a hygiene drive this week, collecting everyday toiletries like toothpaste, soap, and paper towels to create “blessing bags.”

Real estate professionals, brokerages, and associations can find ideas for volunteer activities and access resources to promote the event and media templates and graphics to share on social media in spreading the word.

Share How You’re Participating

REALTORS® taking part in the 2022 REALTOR® Volunteer Days are encouraged to share their activities at nar.realtor/rgn. Their stories may be highlighted by NAR on the @RealtorsAreGoodNeighbors Facebook and Instagram accounts. 

©National Association of REALTORS®
Reprinted with permission

Happy Halloween? Mortgage Rates Average 6.66%

Despite a slight decrease this week in mortgage rates, the average for the 30-year fixed-rate loan remains more than double what it was a year ago, adding hundreds of dollars per month to financing costs for home buyers. This is prompting more buyers to retreat from the market: Mortgage applications to purchase a home are down 13% week over week and have fallen 37% compared to a year ago, the Mortgage Bankers Association reported this week. “Rates remain quite high compared to just one year ago, meaning housing continues to be more expensive to potential home buyers,” says Sam Khater, Freddie Mac’s chief economist.

Realtor.com® reports that home buyers have lost about $107,000 in buying power this year. That means buyers who budgeted for a $500,000 home at the start of the year may now be able to afford a property worth only $400,000 or less.

For buyers who are able to still financially move forward, more are turning to adjustable-rate mortgages to lock in a lower rate. However, that rate can jump significantly over time. ARM rates are about a percentage point lower than the 30-year fixed-rate mortgage. The share of ARMs was 11.8% of mortgage applications last week, up from around 3% earlier this year, the MBA reports.

Will Higher Rates Spark More Urban Flight?

Home buyers may be tempted to expand their search criteria to find places that offer greater affordability farther away from city centers. Nadia Evangelou, senior economist and director of forecasting for the National Association of REALTORS®, notes that rural areas, which are seeing migration gains, continue to be a prime target for buyers. “With mortgage rates near 7%, many people are looking for more affordable homes in less dense areas,” Evangelou writes on the Economists’ Outlook blog. In general, she notes, homes are about 50% less expensive in rural areas and about 20% less expensive in the suburbs than in urban centers.

Freddie Mac reports the following national averages for mortgage rates for the week ending Oct. 6:

• 30-year fixed-rate mortgages: averaged 6.66%, with an average 0.8 point, falling slightly from last week’s 6.70%. Last year at this time, 30-year rates averaged 2.99%.
• 15-year fixed-rate mortgages: averaged 5.90%, with an average 1 point, dropping from last week’s 5.96% average. A year ago, 15-year rates averaged 2.23%.
• 5-year hybrid adjustable-rate mortgages: averaged 5.36%, with an average 0.3 point, increasing from last week’s 5.30% average. A year ago, 5-year ARMs averaged 2.52%.

Freddie Mac reports commitment rates along with average points to better reflect the total upfront cost of obtaining the mortgage.

©National Association of REALTORS®
Reprinted with permission

A Passion for Giving That Outlasted a Pandemic

Five REALTORS® whose selfless drive and ingenuity helped fuel their charitable efforts to new heights in the midst of the COVID-19 pandemic have been named the National Association of REALTORS®’ 2022 Good Neighbor Awards winners. For 23 years, the Good Neighbor Awards has recognized real estate professionals who make an extraordinary impact on their communities through volunteer work. The five individuals named as this year’s winners exemplify how REALTORS® make their communities a better place to live, work and raise a family.

“I am so proud to honor our Good Neighbor Awards winners for how they’ve effected change to improve the lives of others in their communities,” says NAR President Leslie Rouda Smith. “Each of these REALTORS® has devoted hundreds of hours a year and raised huge sums of money for their respective causes. I salute them for their vision, dedication, passion and selfless generosity.”

Each of the five winners, who were selected by a multi-stage, criteria-based judging process, will receive a $10,000 grant for their charity and be featured in the fall 2022 issue of REALTOR® Magazine. They will also be presented with crystal trophies on Nov. 12 during NAR NXT, The REALTOR® Experience—the association’s annual conference—in Orlando.

Meet the 2022 Good Neighbor Awards Winners

Jennifer Barnes
Keller Williams Realty Peachtree Road
Brookhaven, Ga.

In 2020, Jennifer Barnes thought she would feed people for just a few weeks until the COVID-19-induced shutdowns ended. That experience opened her eyes to an underlying vulnerability in her affluent, Atlanta-area neighborhood that extended well beyond food. She founded the nonprofit, Solidarity Sandy Springs, which inspires more than 2,600 volunteers to provide wide-ranging community services for thousands of families, including free eye exams and glasses, flu vaccines, job fairs, back-to-school backpacks and more. Barnes has also distributed nearly one million pounds of food to approximately 46,000 shoppers. Read her story and watch the video.

Dennis Curtin
Legacy Investments
Kansas City, Mo.

Dennis Curtin founded Mimi’s Pantry to offer a more positive food pantry experience to people in need. The state-of-the-art, 6,000-square-foot facility welcomes shoppers to browse the aisles and choose their food, just as they would in a grocery store. The nonprofit invested in commercial refrigeration equipment and offers fresh meat, produce and milk. It also has a play area and library for kids and is currently building a greenhouse and an orchard of fruit trees and berry bushes. In three years, it has served 50,000 individuals. Read his story and watch the video.

Jim Edmonds
Emerald Isle Properties
Kilauea, Hawaii

Since the Hawaiian island of Kaua’i may only have a handful of homes for sale under $1 million at any time, Jim Edmonds, founder of the nonprofit Permanently Affordable Living (PAL) Kaua’i, partners with other nonprofits to build and convert affordable housing for workers. Edmonds navigates the complex challenges of poor infrastructure and resource scarcity through innovative, cost-saving solutions like solar energy, edible landscaping, shared electric vehicles and shared bicycles. Read his story and watch the video.

Heather Griesser LaPierre
RE/MAX Preferred Newtown Square
Newtown Square, Pa.

To address food insecurity in her neighborhood and worldwide, Heather Griesser LaPierre founded Kids Against Hunger Philadelphia. She rallies hundreds of volunteers each month to pack nutritious, ready-to-make pasta- and rice-based meals. When schools were shut down in 2021, she doubled production to 350,000 meals per month to ensure children who depended on school lunches were fed. Since 2015, she has packed and distributed more than 9 million meals. Read her story and watch the video.

MaliVai Washington
Diamond Life Real Estate
Jacksonville Beach, Fla.

For 26 years, MaliVai Washington Youth Foundation (MWYF) founder Mal Washington has been breaking the cycle of poverty through a vibrant after-school mentoring program. Originally rooted in his beloved sport of tennis, MWYF now serves 500 kids annually through a comprehensive youth development program of academic tutoring, leadership skills, financial training and fitness. He is proud of the 100% high school graduation rate of the program as the surrounding neighborhood’s dropout rate is 20%. Read his story and watch the video.

In addition to the winners, the following five REALTORS® have been recognized as Good Neighbor Award honorable mentions and will each receive $2,500 grants for their charity:

• Tamara “Tami” Hicks of Century 21 Signature Real Estate in Ames, Iowa, whose nonprofit Overflow Thrift Store has raised more than a half-million dollars for charities and has saved millions of items from landfills.
• Lisa Hoeve of Coldwell Banker Woodland Schmidt in Holland, Mich., whose nonprofit Hope Pkgs has provided overnight comfort bags to more than 4,200 foster children.
• Debbie McCabe of Berkshire Hathaway HomeServices Fox & Roach, REALTORS®, and the Trident Group in Devon, Pa., whose nonprofit Covenant House Pennsylvania houses and empowers young people facing homelessness.
• Debbie Miller of Webpro Realty in Lakeland, Fla., whose nonprofit kidsPACK feeds 3,000 children on weekends when they don’t get school lunch.
• Kathy Opperman of Long & Foster Real Estate in Collegeville, Pa., whose nonprofit Pillars of Light and Love has offered 800 free workshops and support groups to build self-esteem and resilience in adults and kids.

In September, realtor.com®, a primary sponsor of the Good Neighbor Awards, invited the public to vote for their favorite of the 10 finalists. The top three vote-getters all received additional donations for their charities. The following REALTORS® have been crowned as this year’s Web Choice Favorites:

• Kathy Opperman, who will receive an additional $2,500 bonus donation for Pillars of Light and Love.
• Debbie Miller, who will receive an additional $1,250 bonus donation for kidsPACK.
• Lisa Hoeve, who will receive an additional $1,250 bonus donation for Hope Pkgs.

©National Association of REALTORS®
Reprinted with permission