Excerpts: Since space is the only place that is pandemic free, I thought it would be fun to try to apply space and science fiction terms to real estate. Let’s take a little break from the stressful atmosphere we are experiencing here on earth and have a little fun. Perhaps you can think of more.
Here are two:
Orbit– The path homeowners take whilst following the appraiser around the home, trying not to follow too closely by maintaining at least six feet of distance. (Probably taking pictures of the appraiser in the PPE)
Blackhole – The place where Zestimates go after being debunked by reality.
To read and see lots more Strange Appraisal Terms, click here.
My comment: I love Jamie Owens’ blog posts! Unbelievably creative!! Plus, outstanding/strange videos, animated gifs, etc. etc. I have been a big SciFi fan since high school and used space videos in my experimental music band for many years.
For lots more appraisal topics, Click Read More below!
NOTE: Please scroll down to read the other sections of this long blog post on hybrid appraisals, mosaic homes, mortgage origination stats, Covid tips for appraisers, etc.
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11 Homes Transformed Into Amazing Mosaics
If you own your property, why not bedazzle it?
Excerpt: The art of mosaic making, which has endured for more than 2,000 years, can clearly be addictive. It draws people in with its versatility and ease, and soon every brightly colored piece of glass or a uniquely shaped bit of broken crockery becomes the latest addition to an ever-growing canvas.
Sometimes, mosaic mania becomes a home makeover. Scattered around the globe are unique private homes whose occupants were inspired to cover walls and surfaces with shimmering fragments of glass, tile, shells, mirrors, and nearly any other material they could find. These properties became continuously evolving and living works of art, entire homes with intricate motifs, and wondrous patterns. Below are 11 places where mosaic obsession took over, and the result is a pastiche wonderland.
To read and see lots more, click here.
35 year old appraiser makes $280,000 per year with 75 hour work week
Excerpts: Bilodeau works between 65 and 75 hours a week, writing up appraisals during the weekdays and driving to sites on the weekends. On Saturday and Sunday, “I can get to a lot of houses really quickly with no traffic,” he says. “It makes me more productive.”
He never expected to earn so much in this business.
In 2011, his first year as a trainee, Bilodeau brought in just $17,000. But he knew he could do better. He set a goal to grow his income to $80,000 a year, which he exceeded in 2012 when he started working for himself.
To read more, click here.
My comment: Very interesting article about his background, including goals and plans for success (includes investing in real estate). The photo above was taken in one of his rental properties. I remember when I used to work that much. I was much younger ;>
VA and Bifurcated Appraisals
Excerpts: … in November 2019, the VA published guidance outlining the rules for its Assisted Appraisal Processing Program (AAPP). The VA’s guidelines surrounding bifurcated appraisals have been heralded as a common-sense approach to the valuation process that allows appraisers flexibility while serving and protecting the veteran community…
The VA rules also require that the outside individual contracted by the VA panel appraiser to gather information be another licensed appraiser or appraiser trainee. Specifically, that individual must be “an individual who may perform appraisal-related work in compliance with VA policies, USPAP, state, and local laws,” such as “another VA fee panel appraiser licensed in that jurisdiction, a non-VA fee panel appraiser licensed in that jurisdiction, or an appraisal trainee/apprentice registered or otherwise authorized to provide valuations in that jurisdiction.”
To read more, click here.
My comment: Worth reading. The best setup I have seen for bifurcated appraisals. VA allows trainees also. Fannie’s approach had significant opposition from appraisers. I have never been on the VA panel, but have strongly recommended it for appraisers for a long time as it is lender work not run by Fannie and AMCs. I wrote an article about it a few years ago on the paid subscriber page – fees, how to get on the panel, pluses and minuses, etc.
Coming in the July issue of the paid Appraisal Today, available July 1
Appraisers are not home inspectors – very important to include in all your reports – a significant issue for borrower claims, the majority of claims today.
Borrowers can get confused about the difference between appraisers and home inspectors.
“The appraiser is not a home inspector, and this appraisal report is not a home inspection report. It does not guarantee or imply that the property or any structures are free of defects or property condition problems. It is suggested that the borrower
secure a professional inspection of the property and take diligent steps to assure the house and property are acceptable to them prior to closing escrow.”
Disclaimers/statements also included (sample):
- External or desktop appraisals
- COVID-19 market conditions
- Intended users
Also included is good legal advice from Peter Christensen, on where to put them in your appraisal report, use of hypothetical conditions, signing “disclaimer” forms before you go into a home being sold, getting sued if occupant gets the virus after your visit, and other practical topics.
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The Rich Have Stopped Spending And That Has Tanked The Economy
Excerpts: The wealthiest American households are keeping a tight grip on their purse strings even as their lower-income counterparts are spending a lot more freely when they emerge from weeks of lockdown. That decline in spending by the wealthy could limit the whole country’s economic recovery…
Researchers based at Harvard have been tracking spending patterns using credit card data. They found that people at the bottom of the income ladder are now spending nearly as much as they did before the coronavirus pandemic…
They have a lot of discretionary income, and before the pandemic were spending a significant chunk of that going to nice restaurants, the theater, or traveling and staying in nice hotels. Those are precisely the things that have been off-limits since the coronavirus hit.
To read more, click here
My comment: I am spending a lot less money also. No restaurants, gym, hair salons, movies, travel, etc. Of course, I do miss it all!!
My original very long article was published on April 1 in the monthly Appraisal Today newsletter, focusing on the scientific side of the pandemic, such as the comps (previous epidemics), “herd immunity”, why data is important, etc. It is available at www.appraisaltoday.com/coronavirus Updates from this email newsletter are also there.
8 things we got wrong — at first — about the deadly pandemic
From masks to contagion rates, our understanding of COVID-19 has come a long way
Excerpts: A lot of our early assumptions about the new coronavirus have flip-flopped.
This is normal. That’s how science works — it’s a process of being less and less wrong over time. COVID-19 is new, so there’s lots of uncertainty. And the pandemic’s size and scale caught us by surprise. As we learn more, our understanding of the virus continues to change.
- Masks are useful, after all.
- Don’t just blame China; our early cases came from all over.
- It’s less deadly than we first feared.
- It’s spreading more slowly.
- It’s not just a respiratory disease.
- Your mail probably won’t kill you.
- Children aren’t completely safe.
- You were smart to store toilet paper.
A well written, understandable article. Worth reading. With scientific references, of course.
To read more, click here
Note on link: It was originally published in my local newspaper, which may have a paywall to read it. If so, google the title as it has been republished in other places.
For lots of Covid analysis and news, go to my new covidscienceblog.com
MY PERSONAL COMMENTS
Why are COVID-19 information and analyses always changing?
It is a novel coronavirus. Novel means new. No human had ever been infected. Scientists look at previous epidemics, such as H1N1, SARS, and the 1918 “Spanish” flu (plus seasonal flu viruses) and current COVID-19 in other countries, to try to determine what will happen here. For example, most of the prior pandemics had “waves” of infections, so that is why scientists are predicting them now. But we don’t really know what will happen. The past does not always predict the future.
COVID-19 is very new, and there is limited data (tests, etc.) and research. Over time (unfortunately, often years), it becomes more clear how a virus affects us, treatments, etc.
For example, now we know that it spreads through airborne suspensions, or aerosols, within closed spaces, etc. There is a lower risk from contaminated surfaces. The higher the density of people, the riskier. For example, 6 people living in an 850 sq.ft. 2 bedroom home vs. 2 people. Wearing face masks, hand washing, and social distancing are very important.
Mandatory vs. voluntary requirements – my personal face mask example
Almost all active residential appraisers are going into homes so they can stay in business. They wear face masks and other PPE. I am using this an example as you deal with it every time you do interior appraisals. Note: I quit doing interior observation appraisals in February because of the virus risk. Also, I was not comfortable doing them without going inside as the values were less reliable, in my opinion. Also, I know a lot about COVID-19’s risk factors from a scientific view. I am a scientist, although I have not worked in labs for many years.
I have known about the virus since January and started writing about it in this newsletter on February 21. My California county started mandatory shelter in place in mid-March, one of the first in the country.
Everyone wearing face masks is very important to me. I am not paranoid but cautious. I am 77 years old and at high risk from age. Every person who does not wear a face mask could infect me. I wear a mask to protect others. But, I did not start wearing one all the time until it was mandated in my county.
Another factor is the “big picture.” Face masks, hand washing, and social distancing is a lot better than “shelter in place” for slowing down the pandemic. Until the pandemic spreading slows down, people like me will not be supporting the economy by spending much money.
I like to use grocery stores as a good indicator of face masks and social distancing. I have been going to the same grocery store weekly on Sunday mornings for many years. This is how I track what happens here. When the virus was very active, and we were in a hot spot, I went to my regular grocery store. Not many had face masks or practiced social distancing, even the employees. I did not always wear one either or regularly practice social distancing.
In Mid-April, my county mandated wearing face masks. Within a week, everyone in my grocery store wore face masks and did 6 ft. social distancing. An employee was stationed at each entry door to check/remind people for a day or two, but almost everyone had face masks. It was the same in local pharmacies and stores that were open. Few, if any, in my county objected to county mandated restrictions. We preferred using face masks. One nearby county had some pushbacks, including personal threats to the public health official. We did not have that. I am very lucky to live here.
A few weeks ago, my county mandated wearing face masks whenever outside (one of the few who did this) . Yesterday, the California governor started a similar mandate because too many people were not wearing face masks. I had not been wearing one when going from my front door to my garage, for example. I sometimes met people walking on the public sidewalk and chatted with them. It was just too hard for me to remember putting on a mask when speaking with them. Now, I don’t have to worry.
On a side note, the population in my city is 30% Asian, mostly Chinese. In China and Taiwan, everyone wearing face masks outside has been occurring for a long time. Typically older Chinese immigrants also wear face masks, so they did not seem that unusual to me.
In areas where wearing face masks are recommended, but not mandatory, many fewer people wear face masks. Why? Humans are social. We do what other people do. It is human nature. If only a few wear face masks, it makes you stand out. Your face masks protect others, not you.
You decide what precautions to use. Everyone is different.
I really worry most about infecting someone else. I live alone with my cat. Fortunately, I don’t have to worry about getting infected and bringing it home, so I am less risk-averse. As we all know now, being in interior spaces with the same people for periods of time, communicating face to face for only 10-15 minutes, can be risky, whether in a bar, restaurant, or a home. Talking loudly is even riskier, as is singing.
I have not left my small city since mid-March. I only go to the grocery store and my favorite doughnut store. I get what else I need online. I play singles pickleball several times a week, which is fun. Had a backyard lunch with a friend last week. I really try to maintain social distancing and always wear a face mask. I don’t go to any stores that are crowded or have narrow aisles. I read and write a lot about the risk factors.
But, I had my hair cut last week. It was getting long and driving me crazy. None of my friends are getting this done – too risky. My haircutter has been coming to my house to cut my hair for 10 years and cut my hair on my back porch. We both had n95 masks and did not talk much. But, I am still worried about a possible infection.
This week I developed a dental problem and have to go to the dentist to have it checked. I have been telling everyone I know that it can be risky, especially teeth cleaning. I made the first appointment of the day (the least risky time), and asked lots of questions about staff being tested, HEPA air cleaning, calling me from my car to come in, etc. The rooms are very small, typical for a dentist’s office. I will worry that I may have gotten infected for a while after the dental work.
I won’t go inside restaurants or bars (both are very risky), stores with narrow aisles and lots of people, etc. until the virus is contained or there is a vaccine available to everyone. I don’t go to the gym, laid off my house cleaner, etc. They are all too risky for me.
My county is starting to open up (dentists were recently allowed). I really wish the pandemic was much weaker, so I could go out more.
HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to www.mbaa.org Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today.
Mortgage applications increased 8.0 percent from one week earlier,
WASHINGTON, D.C. (June 17, 2020) – Mortgage applications increased 8.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 12, 2020.
The Market Composite Index, a measure of mortgage loan application volume, increased 8.0 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 7 percent compared with the previous week. The Refinance Index increased 10 percent from the previous week and was 106 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 4 percent from one week earlier. The unadjusted Purchase Index increased 2 percent compared with the previous week and was 21 percent higher than the same week one year ago.
“Purchase applications increased to the highest level in over 11 years and for the ninth consecutive week. The housing market continues to experience the release of unrealized pent-up demand from earlier this spring, as well as a gradual improvement in consumer confidence,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Mortgage rates dropped to another record low in MBA’s survey, leading to a 10 percent surge in refinance applications. Refinancing continues to support households’ finances, as homeowners who refinance are able to gain savings on their monthly mortgage payments in a still-uncertain period of the economic recovery.”
The refinance share of mortgage activity increased to 63.2 percent of total applications from 61.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2.8 percent of total applications.
The FHA share of total applications decreased to 11.0 percent from 11.5 percent the week prior. The VA share of total applications decreased to 11.5 percent from 12.3 percent the week prior. The USDA share of total applications increased to 0.7 percent from 0.6 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.30 percent from 3.38 percent, the lowest level in survey history, with points decreasing to 0.29 from 0.30 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) decreased to 3.67 percent from 3.70 percent, with points increasing to 0.28 from 0.26 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.33 percent from 3.38 percent, with points decreasing to 0.23 from 0.24 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.80 percent from 2.83 percent, with points increasing to 0.28 from 0.26 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs increased to 3.07 percent from 3.02 percent, with points increasing to 0.29 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The survey covers over 75 percent of all U.S. retail, residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks, and thrifts. The base period and value for all indexes is March 16, 1990=100.
NOTE: NEW POSTAL ADDRESS
Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
1826 Clement Ave. Suite 203 Alameda, CA 94501