Housing and Community Development

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John Westberg AIA
Architect
Ancient Edifice
Phoenix AZ
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I have to say that the greed of bankers preyed upon the greed of people spending too much of borrowed money. There is much blame and it is spread around. The bubbles never last and EVERYONE knows that, they just don't want to be left holding the bag. Nowadays, if you are the last in line people play the victim and the bleedings hearts want others to fix it for them. Screwy. People who create wealth actually share the wealth through developing projects, investing in business, giving to charity and enjoying their earnings, as they should.
I work with successful healthy people and I don't do institutional work. The paperwork puts me to sleep, besides, most of the government buildings that I see do not serve the public in rational, modest, conservative way. I see much as my tax dollars being wasted by bureaucrats with no accountability.
I enjoy the energy of free enterprise and don't look forward cradle to grave mediocrity and the nanny state. I don't appreciate the organizing and buying of votes of those on the dole, the entitlement cadre.
I choose who gets the benefit of my charitable donations and refuse to support structures antithetical to my best interests.
I am architect to the successful, probably because they live outside the box and create their future. 
As to BofA, if you don't like business, don't support it. 5 bucks a month is a pretty pathetic issue to get upset about, really. To blame the banks for everything is misplaced, our representatives gave the our money. Let's kick the rascals out. It's the American way.
If one doesn't like big business, one should not be on the cell phone, hello? Express your intergrity of your complaint and don't use the products from the companies that don't do what you like. Encourage others to do the same, but marching on Wall Street is a bit general. I think there may some really great companies being traded that have nothing to do with the Occupy Entitlement group. You know, of course, Hitler was a socialist. The Nazi's were a socialist movement and the earliest members were teachers and intellectuals in Germany.
End of rant.

The Housing crisis was not the fault of the millions of victims that bought property at the wrong time. I reject this nonsense! The perpetrators of the disaster want everyone to think blame must be shared. The simplicity of the problem is that the banks and their appraisers certified the values of millions of loans at a price well beyond what the property should have been worth in the first place. Never in the history of real estate have we seen the price of an average house double in less than a decade. Even in the most robust economy this insanity would not have lasted, rather we were giving away labor jobs to foreigners like they were 3 day old pastries. How can anyone believe this escalation in value was normal or realistic? It amazes me how people can ignore the fact that values are returning to what they should have been all along, according to historic data. Instead we blame the victims and not those who certified these ridiculous values for the most expensive commodity the average American will buy in a lifetime.

I believe we have two groups of rigged value deniers. The group that bought before 2003 that think they saw a realistically large return on their wise investment and those who bought after 2003 who refuse to admit they got ripped off, but simply lost at the stock market of housing. I watched appraisers certify any value that someone was willing to get in debt for. I watched how the mathematical flaws in the Comparative Approach (most common) allowed a single sale to be used by everyone in the neighborhood to justify a higher certified value for EVERYONE. We must wake up and quit accepting this nonsense as if it was just an accident, just a bubble. The system was rigged to allow values to skyrocket disproportionately to the actual sales. The beneficiaries had every motive in the world to cash in on a higher loan amount, even if the interest rates were lower. We're talking 2x the price in less than a decade. Think of the volume of loans sold because people thought they had access to "free money". That's what they all called it back then, remember? Why did so many people refinance their homes? Don't you think the banks want to sell more loans? When the banks and appraisers certify that your house is now worth $100k more in just 5 years, who is going to disagree? Now you get a new loan based on a fictitious value and 2 years later the same people certifying that last amount are saying it's worth $100k less, not more. This means you owe $200k more than what your house is worth based on the expert opinion of the appraiser and bank that issued the loan.

Don't you wish Architects could get away with certifying such things that turn out to be so untrue, they tank the entire US economy? We get fried for something our consultants do. Why are we giving a free pass to these people? Why isn't anyone going to jail? Why are we constantly shaming the victims rather than get down to the bottom of the problem that caused this mess? Our profession depends on bank loans and values being accurate. Only a fool would think that over 20 million people all of the sudden got irresponsible at the same exact time and the system was completely innocent. Unless your wages went up significantly in those 5-6 years, then buying the same house for double the price would require an exotic loan. You didn't have to get greedy to lose. Just buying the same thing became instantly unaffordable. The shamelessness of the the greedy perpetrators and their martyrs to scape goat everyone that bought a house because everyone must be greedy for wanting shelter. Most of these people didn't try to pull a fast one on the system, the system pulled a fast one on them. It's the bank's responsibility to themselves and their clients, not to lend them more than they could afford. They more than blew it and who lost? Not the people who caused all of this mess by simply not doing their job.

This crisis will repeat itself if we don't fix the appraisal system. You can't get a loan without an appraisal, so what are we waiting for? This one issue just destroyed our profession and it could fix it. Those appearing skeptical of why, how, or who are the change resistors so full of fear, that this kind of disaster is less frightening than the prospect of attempting to do something about it. Many of you may never design residences, but this crisis has made it painfully obvious which side of the Building Industry has more influence and power over the other. This wasn't a Hotel Crisis or a Library Crisis. We all have a stake in Appraisal Reform!

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Eric Rawlings AIA
Owner
Rawlings Design, Inc.
Decatur GA
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