Top markets for affordable renovated housing inventory

Despite the rapidly deteriorating affordability, there is some hope for homebuyers in the form of renovated homes: properties that have been rehabbed into move-in ready condition after being purchased at auction.

HousingWire Magazine: December 2021/ January 2022

AS WE ENTER A NEW YEAR, let’s look at some of the events that we can look forward to in 2022. But what about what’s next for the housing industry?

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Logan Mohtashami on Omicron and pending home sales

In this episode of HousingWire Daily, Logan Mohtashami discusses how the new COVID variant, Omicron, will impact inflation and whether or not it will send mortgage rates lower.

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NAR says it’s doing what it can on housing discrimination

The gargantuan San Diego event focused on NAR's role in the homeownership gap

HW+ agent putting sign in the yard

A National Association of Realtors (NAR) committee vice chair recommended Friday that the federal standards governing real estate appraisals loosen up. Namely, appraisers should no longer have to partake in a two-year apprentice program as part of their licensing process.

Francois Gregoire, an appraiser in St. Petersburg, Florida, and head of NAR’s Real Property Valuation Committee, pointed specifically to the apprentice training requirement – no comparable requirement exists for real estate agents – as an issue for why no one is joining a depleted profession in the crosshairs for allegedly racially biased appraisals.

Gregoire also said his committee is “actively working” to broaden its reach with civil rights groups, including the NAACP and Urban Institute, to address biased appraisals that widen the home valuation gap. The longtime appraiser seeks buy-in from the Appraisal Foundation, the Washington D.C. group federally empowered to administer national appraisal standards.

Gregoire’s pointed suggestion came amid a Friday at NAR’s annual conference that took on racism in real estate.

The meeting, physically and virtually, of hundreds of thousands of real estate agents, is an almost overwhelming affair. Taking place in the cavernous San Diego convention center and sprawled out to an adjoining hotel, the conference jams together 200 sessions total.

Topics range from the overlap of blockchain and real estate to mental wellness for real estate professionals. Sessions on matters like “Federal issues in real estate” (more on that shortly) were standing room only affairs, and lines snaked yards for use of convention center escalators.

Still, NAR President Charlie Oppler perhaps set the tone in remarks Friday morning focused upon the racial home ownership gap. White home ownership in the U.S. is about 70%, according to U.S. Census Bureau figures, while the Black homeownership rate is 44% and the Hispanic rate 49%

The trade group leader, who is also president of a Sotheby’s International Realty franchise in New Jersey, noted that last year NAR apologized for the first time in “creating systemic housing discrimination” through the decades-long support of real estate and lending practices such as redlining.

“We were wrong,” Oppler said. “We’ve got to move forward and do things and we are doing that.”

So, what is NAR doing?

Oppler said that the trade group is “one of the few corporate sponsors” for the Martin Luther King Foundation.

Also, NAR has created voluntary and online videos for its members on conscious and subconscious bias. Oppler expressed his disappointment that few members have availed themselves of these resources.

For example, 28,000 of the group’s million-and-a-half members streamed a video on implicit bias. “We still have work to do,” Oppler said.

NAR’s Fair Housing Policy Committee offered some specifics of what else NAR is doing. The Fair Housing Act has been around since 1967. But NAR – which has committees on everything from federal taxation to convention financing & policy – only started the Fair Housing committee last year.

“We have accomplished all our committee’s goal this year,” declared Fair Housing committee chair Jeffrey Hicks. “Our purpose is to develop public policies that develop equality and opportunities in real estate.”

Those policies seemed to mainly include supporting U.S. Housing and Urban Development reintroducing “disparate impact” into its enforcement. Under the legal interpretation, facially neutral laws can still be ruled discriminatory if they have an outsized harm on racial minorities.

Hicks then turned over the floor to David Dworkin, president of the National Housing Conference, a coalition of affordable housing groups.

While Oppler couched the homeownership gap as an issue of righting long ago wrongs, Dworkin said the problem is happening right now due to factors including overly conservative lending standards.  

Government-sponsored enterprises and lenders have not done enough to ease borrowing standards and allow for smaller down payments, Dworkin said. The former U.S. Treasure Department staffer also laid blame on listing websites like Zillow whose lending price calculators have a default 20% down payment setting, instead of something lower.

The Fair Housing committee did not specifically suggest how such policies affect NAR member agents, or what these dues-paying members ought to do toward fair housing. Indeed, the extensive menu of policy-focused meetings Friday seemed one step removed from the agent.

At the aforementioned federal issues update, panelists took a victory lap, declaring that President Joe Biden’s proposed repeal of the “1031 exchange,” a tax break for people/companies that transfer wealth from one real estate property to the next, is effectively dead. The provision is not part of the $1.2 trillion infrastructure package that Congress passed last week.

An already packed panel was crowded further by the elephant in the room – the U.S. Justice Department’s broad antitrust investigation into NAR and its agents commissions. The federal issues panel did not discuss this investigation.

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