Does Minimum Wage Increase Help Or Hurt The Appraisal Business?

[J Grant]

You're wrong about minimum wage workers moving and becoming homeowners. Dead wrong.

Here in Calif we have had minimum wage increases and our minimum is $12/hr as a result of a series of increases over several years. As far as I can tell, 100% of that increase went straight into apartment rent increases and other increases in the cost of living. The minimum wage workers today don't have any more discretionary income than they had 5 years ago. All enabling more renters to pay higher rents does is lead to higher rents. Whether people make their housing choices as being the residual after all their other expenses are met or vice versa makes no difference.

That applies to CALIFORNIA with super high home prices. There are many areas of the country, including right where I live and work, where homes or condos cost 75k-200k and many homes bought FHA or VA or low down, being able to save for that down-payment or make more $ to qualify for loan can move some from renter to owner category

Starter, small but nice SFR homes here can still be found for 125k-150k.

 

[J Grant]

You're wrong about minimum wage workers moving and becoming homeowners. Dead wrong.

Here in Calif we have had minimum wage increases and our minimum is $12/hr as a result of a series of increases over several years. As far as I can tell, 100% of that increase went straight into apartment rent increases and other increases in the cost of living. The minimum wage workers today don't have any more discretionary income than they had 5 years ago. All enabling more renters to pay higher rents does is lead to higher rents. Whether people make their housing choices as being the residual after all their other expenses are met or vice versa makes no difference.

That applies to CALIFORNIA with super high home prices. There are many areas of the country, including right where I live and work, where homes or condos cost 75k-200k and many homes bought FHA or VA or low down, being able to save for that down-payment or make more $ to qualify for loan can move some from renter to owner category

Smaller but livable and some quite nice SFR homes in areas here can still be found for 125k-150k.

 

[George Hatch]

Only because the wage structures are lower and more compressed. The minimum wage worker still ain't becoming the homeowner.

If anything, you should be taking the examples that are occurring in places like California and Seattle as an example of what your future is going to look like for the poor if you emulate our economic policies.

 

[glenn walker]

Almost all appraisers are self-employed or 1099-Vendors and minimum wage has no effect on them except each time it goes up and their earnings go down they get angry-bitter and depressed because this industry was a cake walk and easy money for many years. I can remember back in 2000 thinking this is crazy because I was making as much money as my cousin who was an-attorney and I made more in 2005 than another family member who was a Medical Doctor with A HMO. As humans we often tend to over-value our profession or industry because if we are making big-money we feel we must be worth it and when the markets shift and our services are suddenly worth less it takes time for reality to set in. I have one friend who is a Longshoreman and he made over $175,000 last year-full-medical-dental -retirement and he says he mostly drives automobiles off the ships into the holding lots. He laughs and says this is easy money but at least he knows it and doesn't try to justify it. The advent of the AMC model was intentionally designed to round up the confederate of fee collecting Lone-Rangers. Once reprogrammed and retrained to work in a system that rewards those who play the game and punishes the ones that wont conform. They also engaged in a typical modern day corporate head game of using titles to make the indentured slaves feel like they are part of something bigger by calling them Team-Members-Valued Partners or Valuation Experts after all years ago nobody wanted to say they were a Trash Truck Driver but once we renamed them to Sanitary Engineers the whole crew got happy.

In Summary:
When appraisers start talking about minimum wage it simply is evidence that Subconsciously fear is setting in because their wages or fee's have been stagnant or declining and it sounds better to discuss the issue based on economics rather than "Screaming" if these new limited and cheap appraisal products take hold we are all in a world of economic hell. Already many residential loan production appraisers are in a race to the bottom of the hill and the minimum wage at some point will be the baseline for the AMC's and Lenders to start paying the Hybriders-Bi's and 1004Ps.

 

[Carnivore]

Artificially Raising the minimum wage is not the way. because it just raises the cost of living across the board.

Here is something to consider. That makes our business better or more likely to be more profitable.

https://extension2.missouri.edu/dm3006

https://www.amiba.net/resources/multiplier-effect/

Service Industry does not really create any wealth. It just extracts wealth from one area(or one person) and moves it to another area(another person). AMC are a good example. Money spent to procure a mtg loan originates in your state from a lender(multiplier) an AMC located in another state then is paid to find an appraiser in the state where the loan originates(the, AMC, are a minus multiplier here, but a multiplier where they are). They engage an appraiser in the state the loan is originated, Appraiser is local, his/her money is spent locally(multiplier), BUT the AMC Skim left the state(lost that portion of the multiplier)

To create new and real wealth; you take a raw material like timber from your locale, cut it, saw it into boards(locally), sell it locally to a furniture manufacturer.and sell it locally to a retailer who then sells to the consumer. - if your Lucky the Manufacturer is also exporting the furniture outside your community and even outside your state. Thus bringing new money into your locale, a big multiplier because its new and greater wealth moving around in your local economy.

No where in the above has anything to do with minimum wage being raised artificially. It rises on its own as demand for the labor increases. Quite the contrary if you artificially raise minimum wage in your local you actually depress the economic activity within the locale.

 

[J Grant]

Why is raising a min wage "artificial", if more people want it and elect govt to make it happen?

Seems more like the below par min wage now is artificially kept down by lobbyists.

Raise it and see what happens, we do know keeping it low means trapping many workers and their families in a poverty cycle and the depressed areas with boarded up stores attest to that.

Or is it a roll of the dice that areas of higher pay have thriving businesses and housing markets?

It is not about "wealth" creation" nor "wealth redistribution", Most working people will never be wealthy and the wealthy are not in danger of losing it unless by their own stupidity. It is about pay for work and does that pay cover basic living costs.

 

[Michigan CG]

Every single product or service is priced at what the market is willing to pay. If the market is not willing to pay $X for a product or service that product or service goes away or the price has to be lowered. If that product or service has strengthened demand then the price will go up. This is all basic high school economics.

Labor should be no different. The minimum wage should be $0 and the market gets to decide the value of the labor.

 

[Overimprovement]

Minimum wage hikes are thinly disguised veils of the socialistic redistribution of wealth, the end desire of which is invariably to eliminate income 'inequalities'.

All it does in reality is void the capitalistic risk/reward model. Fewer people supporting more people with each iteration. It will self collapse at some point.

Give a man a fish...

 

[Carnivore]

Why is raising a min wage "artificial", if more people want it and elect govt to make it happen? Your a Closet Socialist! LOL

Seems more like the below par min wage now is artificially kept down by lobbyists. TRUE to some extent

Raise it and see what happens, we do know keeping it low means trapping many workers and their families in a poverty cycle and the depressed areas with boarded up stores attest to that. NOT TRUE - THIS IS DIRECTLY RELATED TO FEDERAL, STATE and LOCAL TAX POLICY Plus POOR FOREIGN TRADE AGREEMENTS

Or is it a roll of the dice that areas of higher pay have thriving businesses and housing markets? Its not a Roll of the Dice, Not my problem that your State Sucks and My State has better Tax Policy and a more business Friendly Environment. FTR, South Carolina is Killing us in attracting industry and Business.

It is not about "wealth" creation" nor "wealth redistribution", Most working people will never be wealthy and the wealthy are not in danger of losing it unless by their own stupidity. It is about pay for work and does that pay cover basic living costs.

Its all about Wealth Creation and Keeping as much of your wealth possible! The Fruit of your Labor is the reward. Its not how much you earn its how much you spend.

 

[J Grant]

Minimum wage hikes are thinly disguised veils of the socialistic redistribution of wealth, the end desire of which is invariably to eliminate income 'inequalities'.

All it does in reality is void the capitalistic risk/reward model. Fewer people supporting more people with each iteration. It will self collapse at some point.

Give a man a fish...

Are you in the one % where you need to be hoarding your wealth and spreading " socialist" fears?

Back to reality - there are business owners and workers, with many workers and fewer owners. The owners are fewer but have resources and power ,the more numerous workers have vote power and purchasing power as consumers themselves.

Every functional society sees a balance between the two
Business owners typically want to pay less, workers typically want to earn more. Business owners have wealth and political influence , workers have influence through their greater numbers and voting.
If workers/citizens vote for a higher minimum wage, that is the "market " speaking.

The "market" values fast food by consumers buying it, however that same market of consumers does not not agree with the workers being paid so little , if they vote to raise min wage.

Which does show a higher $ per hour value for workers in the "market",,,he business owners and franchise owners are their own interest group within the market.