A Black couple ‘erased themselves’ from their home to see if the appraised value would go up. It did - by nearly $500,000

[J Grant]

The house is a POS and lawsuit is juts a good old fashioned shakedown and we are going to see mpre and more of these types of set ups in the future.

Not if they get killed DOA as worthless, HUD already dismissed 2 (not sure if this was one of them )

 

[shrubberyvaluation]

If the complaint is that the appraiser who had the lower appraised value used the best comparables, or at least used the most locationally relavant, it should be thrown out.

 

[Elliott]

And then comes the racist, sexist Yelp 'reviews' from the internet.


Michael B.
San Francisco, CA

4/14/2016
Wow. This is someone who has completely checked out of her profession. The problem is that when Jan makes mindless (or worse, has someone unlicensed and unfamiliar with San Francisco real estate) appraisals on what is many people's single most important financial investment, it has consequences... such as the lender freaking out and almost killing the deal.

While her home value appraisal was merely about 10% below market, her rental assessment was (ahem) 55% less of what I current rent out the property for, and 40% less than SF average, despite the house being appraised well above SF average. WTF?

It doesn't take an expert to realize that ~$2600 is not a reasonable rent for a 2 bedroom standalone home in a good SF neighborhood. Ultimately she relented and fixed it so it was only 25% below market, but this is massive neglect of a professional responsibility and I really strongly discourage anyone from using her service. There are a kajillion appraisers on Yelp that aren't riddled with one-star reviews. Use one of them.

Photo of Tony C.
Tony C.
San Jose, CA

Trashy hags, trashy company, hopefully this lawsuit will put them under where they belong.


Boravy N.
Oakland, CA
12/4/2021

Jeanette Miller is bias and racist. Imagine undervaluing a home for nearly $500K at $1M when all the homes around that house are $1.6-1.7M. That's what you'll get when you go with this firm. I hope they are forced to close their business as they have no business appraising homes if they own racist values get in their way.

 

[George Hatch]

If you go poking about this neighborhood you can see that they built a bunch of these boxes on the pillar foundations. Those pillars run all the way to the roof trusses. And that's fine. There's nothing wrong with a utilitarian box. But what they aren't is a higher quality custom with the taller interior ceilings and the bigger rooms and 2-3 car garages that go with a house that was originally built at twice the size. For example, the public zone of an 1100sf 3bd home is usually going to be a lot smaller than the public zone of a 4/3bd home of 2200sf.

We generally tell people that most room additions won't return their entire costs in the market. That if they want the 2200sf home it will usually be cheaper to go buy the existing home than to buy an 1100sf home and add additions. So if there's some argument about their costs exceeding an appraised value that would actually be a lot more common than not in other appraisals.

The other thing that's annoying about the lawsuit is the social equity argument, which has zero to do with what an appraiser does. It's not the appraiser's fault that the lenders practiced redlining or that appraisal texts published in the 1920s and 1950s reflected the values of those times. It's not the appraiser's fault that the cert refers to picking homes that are the most similar, including proximity, and that the value being sought is what the buyers and sellers would pay for the home with this location, not what the buyers and sellers are paying in other locations. The appraiser has no discretion about any of that, and loading those other problems into this allegation of misconduct is patently unfair to the individual being sued. \

Now there may be problems with what the appraiser actually did in this appraisal, but those actions should form the basis of the lawsuit, not what bankers did 70 years ago.

 

[Elliott]

From KCBS story:

"A Freddie Mac analysis published in September, which examined more than 12 million home appraisals between 2015 and 2020, determined that appraisers were more likely to undervalue homes in predominantly Black and Latino areas. Black and Latino applicants were also likelier than white applicants to receive an appraisal valued lower than the property price."

Funny that they didn't mention that it was a census tract study that found a 0.05% difference (not 5%, 5/100ths of 1%) in neighborhood values. The media can so easily let that lie continue to ride.


Its always interesting to add there are double white poor than black.

"White Poverty Rate: 8.2% (15.9 million people)​

Percentage of non-Hispanic whites who fell below the poverty line in 2020

African American Poverty Rate: 19.5% (8.5 million people)"

Percentage of African Americans who fell below the poverty line in 2020

 

[George Hatch]

Jeanette Miller is bias and racist. Imagine undervaluing a home for nearly $500K at $1M when all the homes around that house are $1.6-1.7M. That's what you'll get when you go with this firm. I hope they are forced to close their business as they have no business appraising homes if they own racist values get in their way.

Virtually none of the homes in this neighborhood have been selling at $1.6M. There's one home that's 1000sf larger, has a sit down view of the bay from the living room and has much higher quality of construction and a really nice landscaping package that sold in 2018 for $1.8m but that property is basically an orphan among the other sales.

52 Buckelew St, Sausalito, CA 94965 | Compass

52 Buckelew St, Sausalito, CA 94965 is a single family home not currently listed. This is a 5-bed, 3-bath, 3,360 sqft property and last sold on 2018-12-19 for $1,795,000.

www.compass.com

The adjustment for the view amenity alone would be worth $1M in SoCal, although probably a lot less in the Bay area. Still, not nothing.

 

[Elliott]

Here's a suggestion to 'end' racist appraisals: When an appraisal is order, there has to provided the appraiser a three year history of appraisals on the subject property (including reports) so the appraiser knows the values which were previously completed, by who, when, and what amount. This is just like appraisers have to disclose the three year history of sales/transfers on the subject property.

I'm willing to bet it would end "racist" appraisals, though it might increase the number of assignments where an appraiser won't take the assignment. But what do the GSE's want? An appraisal, or a racist appraisal. Surely they don't want an objective current appraisal.

 

[shrubberyvaluation]

If you go poking about this neighborhood you can see that they built a bunch of these boxes on the pillar foundations. Those pillars run all the way to the roof trusses. And that's fine. There's nothing wrong with a utilitarian box. But what they aren't is a higher quality custom with the taller interior ceilings and the bigger rooms and 2-3 car garages that go with a house that was originally built at twice the size. For example, the public zone of an 1100sf 3bd home is usually going to be a lot smaller than the public zone of a 4/3bd home of 2200sf.

We generally tell people that most room additions won't return their entire costs in the market. That if they want the 2200sf home it will usually be cheaper to go buy the existing home than to buy an 1100sf home and add additions. So if there's some argument about their costs exceeding an appraised value that would actually be a lot more common than not in other appraisals.

The other thing that's annoying about the lawsuit is the social equity argument, which has zero to do with what an appraiser does. It's not the appraiser's fault that the lenders practiced redlining or that appraisal texts published in the 1920s and 1950s reflected the values of those times. It's not the appraiser's fault that the cert refers to picking homes that are the most similar, including proximity, and that the value being sought is what the buyers and sellers would pay for the home with this location, not what the buyers and sellers are paying in other locations. The appraiser has no discretion about any of that, and loading those other problems into this allegation of misconduct is patently unfair to the individual being sued. \

Now there may be problems with what the appraiser actually did in this appraisal, but those actions should form the basis of the lawsuit, not what bankers did 70 years ago.

There could be problems with both appraisals. If any were noticeable in the lower appraisal I don't think they would go with the argument that the appraiser was biased using homes in the same community.

 

[George Hatch]

If I were reviewing a $1.5M appraisal on this house in this neighborhood I would be asking some serious questions about how the outside comparables were handled. You can literally see the differences in pricing over the last few years on a sales map. For the older homes on full size lots the pricing in the city of Sausalito itself *STARTS* at $1.2M, similar for the neighborhood to the n/w.

 

[CGinMN]

The advocacy group cites circumstances in which appraisers choose comparisons of other home sales located substantially closer to the property receiving an appraisal if within a Black or Latino census tract, Executive Director Caroline Peattie pointed out.

FWIW, this is exactly what the Freddie research note claims is one of the causes of the "appraisal gap."

The average distance between a subject property and its comps is substantially smaller when the property is in a Black or Latino tract than in a White tract.

Then again, as JG points out, their form has a certification that reads:

I selected and used comparable sales that are locationally, physically, and functionally the most similar to the subject property.

Where are the GSEs at in these lawsuits?