In February 2020, Tenisha Tate-Austin and Paul Austin decided to erase all traces of their existence in the Northern California home the Black couple had created for themselves and their children.
They “whitewashed” their home by removing their family photographs and African art displayed around the house. They had a white friend place some of her own family photographs around the home and greet the appraiser as if she were the homeowner.
The couple wanted to see if they’d get a better home appraisal than the one they had received three weeks earlier.
The experiment worked. This time, the appraisal (by a different appraiser from the same appraisal management firm) was almost 50% higher. In three weeks, the value of their Marin City home, 11 miles north of San Francisco, had gone from $995,000 to $1,482,500.
In March, the Austins settled a fair housing lawsuit alleging race discrimination against the licensed real estate appraiser; they’d reached a settlement in October with the appraisal management company.
Sixty years after Martin Luther King Jr. delivered his most iconic speech calling for civil and economic rights and an end to racism, one of the biggest roadblocks to building wealth for Black Americans is still in place: The housing gap has widened from the time it was legal to discriminate based on race.
In 1960, eight years before the Fair Housing Act, which prohibits property owners, financial institutions and landlords from discriminating based on race, the homeownership gap between white (65%) and Black (38%) stood at 27 percentage points. In 2021, or 60 years later, that gap had grown: 73% of white households owned a home compared with Black homeownership at 44%, a difference of 29 percentage points, according to the Urban Institute.
“We missed out on a better interest rate because of the unfair appraisal we received,” Tenisha Tate-Austin said in statement through her lawyer. “Having to erase our identity to get a better appraisal was a wrenching experience. We know of other Black families who either couldn’t get a loan because of a discriminatory appraisal and therefore either lost the opportunity to buy or sell a home, or they had to sell their home because they had an unaffordable loan.”
Explore the series:MLK’s ‘I have a dream’ speech looms large 60 years later
Housing gap:‘We are a broken people’: The importance of Black homeownership and why the wealth gap is widening
King fought racist housing practices in ChicagoThough King knew housing was an important topic when he made his 1963 speech (it included the line “We cannot be satisfied as long as the Negro’s basic mobility is from a smaller ghetto to a larger one,” his focus was ending segregation in the South, said Beryl Satter, professor of history at Rutgers University in New Jersey and author of “Family Properties: Race, Real Estate, and the Exploitation of Black Urban America.”“The speech was about jobs and ending segregation of drinking fountains and restaurants, buses, trains, movie theaters and swimming pools to help pass the Civil Rights Act,” she said. Once that was accomplished, King trained his sights on housing in the North, particularly Chicago, where he focused on enforcing a pre-existing law on open housing, Satter said.The open housing laws in Chicago already forbade real estate agents from steering Black families into Black neighborhoods and dictated that housing should be made available regardless of race.“But like many such open housing laws, it was not enforced,” Satter said.In January 1966, King moved with his family into an apartment in North Lawndale on the West Side of Chicago to bring attention to the poor living conditions of Black families living without water, electricity and heat. He marched with Black and white supporters into segregated white neighborhoods to call for open housing.“And there he was met with the most violence he had ever been met with in any of his civil rights struggles. He said that the violence in Chicago made the whites in Mississippi look good,” Satter said. “He was hit with a stone while marching in Chicago, and he kept going.”Fair Housing Act became law after King’s deathFrom 1966 to 1967, Congress regularly considered a fair-housing bill, but it was ultimately defeated.“It was the first time that a Civil Rights Act had been defeated since the ’50s,” Satter said. “There was massive white resistance to any law or direct action that threatened racial segregation and housing. It was something that whites in the North fought to the death to keep.”After King was assassinated in 1968, President Lyndon Johnson pushed through the national Fair Housing Act as a memorial to King, whose name had become closely associated with the fair housing legislation.The undervaluation of homes in Black neighborhoods, decadeslong housing segregation, a systemic denial of loans or insurance in predominantly minority areas, a persistent income gap, and a historically limited ability of Black parents to leave their families an inheritance have contributed to the nation’s financial disparity, experts say.
During the housing boom of the early 2000s, Black Americans ages 45 to 75 disproportionately held subprime mortgages, loans offered at higher interest rates to borrowers characterized as having tarnished credit histories. Many of these mortgage holders lost their homes and have been unable to return to homeownership.
These trends will affect retirement prospects for Black Americans and their ability to pass down wealth to the next generation, making it not just one generation’s problems but an intergeneration disparity, experts say.
White wealth surpasses Black wealth
In 2016, white families posted the highest median family wealth at $171,000. Black families, in contrast, had a median family wealth of $17,600, according to the Federal Reserve. Homeownership has long been considered the best path to build long-term wealth, so increasing the rate of homeownership can play an important role in closing the wealth gap, experts say.
Over the past decade, the median-priced home in the United States gained $190,000 in value, making the typical homeowner 40 times wealthier than if they had remained a renter, according to a report released in April by the National Association of Realtors.
Some signs of hope emerged during the coronavirus pandemic, when mortgage rates were at historic lows.
During that time, Black homeownership rates increased by 2 percentage points, surpassing the white homeownership rate, which increased just 1 percentage point.
The historically low mortgage rates enabled high-earning, highly educated Black households to boost homeownership rates. Most high-income white households already were homeowners, which explains the smaller magnitude of growth, according to the analysis.
Black homeownership rate saw small improvements
From 2019 to 2021, the homeownership rate for Black households went from 42% to 44%; for white households it went from 72% to 73%.
After experiencing a continuous decline since the Great Recession, the Black homeownership rate finally made gains between 2019 and 2021. The reason was pent-up demand, said Jung Choi, a researcher at the Urban Institute.
“This suggests that affordability really matters,” Choi said. “Now, with the surge in interest rates, we are already seeing a sharp decline in Black homebuyers as well as younger homebuyers.”
Satter said King’s final book, 1967’s “Where Do We Go From Here: Chaos or Community?” cautions against complacency simply because there are laws on the books.
“He really understood that having a law in books was the beginning, not the end. Today we have the Fair Housing Act of 1968, and there are ongoing local, state and national laws that are supposed to stop housing discrimination,” Satter said. “I think King would have predicted that they would not be effective if there wasn’t a larger public will to enforce it and a strong political organization pushing to enforce it.”
Swapna Venugopal Ramaswamy is a housing and economy correspondent for USA TODAY. You can follow her on Twitter @SwapnaVenugopal and sign up for our Daily Money newsletter here.
Wells Fargo announced today that its home loan modification program will be available for 478,000 Wachovia customers acquired via the merger completed earlier this month.
That includes scores of borrowers trapped in nasty Wachovia Pick-a-Payment loans, the high-risk loans that sunk the too-big-to-fail banking giant months earlier.
Customers on the verge of foreclosure or currently in foreclosure will receive an extension until February 28 so they have more time to explore possible alternatives.
“As the ‘investor’ for these loans, we are rapidly designing programs to help these customers,” said Mike Heid, co-president of Wells Fargo Home Mortgage, in a release.
“For those at-risk, we will offer combinations of term extensions of up to 40 years, interest rate reductions, charge no interest on a portion of the principal for some period of time and, in geographies with substantial property value declines, we will even use permanent principal reductions.”
He added that the general goal is to get at-risk borrowers near a 38 percent housing payment debt-to-income ratio.
The San Francisco, CA-based bank and mortgage lender has increased its full-time default/home retention staff 125 percent in the past two years, while Wachovia has increased similar positions by 330 percent in the last year alone.
Wells Fargo inherited roughly $120 billion in new mortgages when it agreed to acquire Wachovia last year, many of which are now deemed extremely toxic, putting the company’s relatively conservative position into question.
However, Heid boasted that 93 of every 100 Wells Fargo mortgage customers are current on their mortgage payments, performance well above the industry average.
Despite the fact that economists always caution homeowners not to look at their homes as investments, people do. In fact, everyone does. How could you not, right?
If something goes up and down in value, and has the potential to make you money, a lot of it, it’d be hard to ignore.
Sure, a primary residence should be considered shelter above anything else, but there’s a reason you chose to buy a home as opposed to rent.
Aside from the tax benefits and the pride of ownership is the ability to get rich.
Unfortunately, everyone seemed to get a little caught up back in the mid ‘00s, namely 2006. During that fateful year, home prices hit what is now referred to as the real estate market’s peak.
Since then, home prices have yet to ascend to levels seen at that time in most cities across the nation.
However, recent gains have pushed us closer and closer, and some cities are already at new all-time highs, somewhat amazingly.
Did You Buy a Home in 2006?
Look, no one likes to admit they overpaid for something, or spent more than their neighbor, but we know a lot of people paid a lot more than they should have for a home in recent years.
Why? Because the national median home price plummeted 27.8% from the fourth quarter of 2006 to the fourth quarter of 2011, from $225,067 to $162,333, according to a new analysis from the National Association of Realtors (NAR).
That would explain all those missed mortgage payments and strategic foreclosures. But even with bad timing factored in, the magic of the housing market has erased past mistakes for many.
In fact, home buyers who purchased properties at the peak in the fourth quarter of 2006 would have positive home equity in 58% of markets covered by NAR.
That’s right, even if you got caught up in the frenzy and decided to take the plunge when home prices were severely overheated, there’s a good chance you’d have positive equity today (if you stuck around).
Okay, maybe not if you took out an option arm with zero down, but the point is clear. Home prices have made their way back from the depths, and now many homeowners are sitting pretty.
In fact, buyers who purchased more recently (during 4Q 2010) would have positive home equity in 84% of the markets covered by NAR.
And buyers who purchased in 2011, 2012, and 2013 are probably in excellent positions, depending on when and where they purchased.
Let’s not forget their stellar mortgage rates either, with many enjoying long-term fixed rates in the 2-4% range.
Who Are the Big Winners?
Pictured above is a chart from NAR that displays the biggest winners in terms of home equity appreciation since the fourth quarter of 2010.
As you can see, homeowners in San Jose, CA have enjoyed a very nice ride lately, with equity up over $200,000 in just three years!
San Francisco isn’t too far behind, nor is the home of the Happiest Place on Earth, Anaheim, CA.
Homeowners in Los Angeles have also been rewarded handsomely with over $100,000 in equity appreciation, along with those in San Diego and Boulder, CO.
Even inland parts of Southern California have chalked nearly $100,000 in gains, with hard-hit Riverside, CA making it into the top 10.
So I guess the moral of the story here is that time heals all wounds in the real estate market.
Just make sure you have the time to hang on. If you take out a mortgage you can’t afford, or buy too much home, you could be forced to unload at an inopportune time, not that a home should be looked at as an investment anyway.
Bay Area home prices are falling as mortgage rates climb to their highest levels in more than two decades, squeezing many house-hunters out of the market and keeping would-be sellers on the fence.
The median price of existing single-family homes dropped 5.2% to $1.26 million across the region from June to July, according to the California Association of Realtors. The decline followed steady price gains most of the year as sales picked up during the traditionally busier spring and early summer home-buying seasons.
But now, spiking mortgage rates are slamming the brakes on an already challenged local real estate market. On Thursday, Freddie Mac reported the average rate for a typical 30-year fixed mortgage rose to 7.09%, up from 6.96% last week, reaching the highest peak since 2002.
“People are just not jumping into buying a home right now at these interest rates,” South Bay real estate agent Ramesh Rao said.
Meanwhile, a 30-year fixed “jumbo” home loan — which is common for more expensive houses — averaged 7.65% on Thursday, according to Bankrate.com. In the Bay Area, a jumbo loan is a mortgage that exceeds $1,089,200.
Mortgage rates have been on a sharp upward trajectory since last year when the Federal Reserve began raising the cost of borrowing to rein in inflation. Rates have more than doubled their recent sub-3% lows, in turn boosting monthly home payments for new mortgages by thousands of dollars and squashing a record-setting pandemic real estate boom.
In November, rates briefly topped 7% before falling to around 6% in February. They’ve been trending up again since.
Despite slowing inflation, Oscar Wei, an economist with the realtors association, said rates could reach as high as 7.5% in the coming weeks before dropping to around 6.5% by the end of the year.
That will likely put more downward pressure on home prices in the near term. And even if rates decline in the months ahead, fewer people typically look for homes during the second half of the year, meaning prices should continue to soften in line with seasonal trends.
“For buyers who are interested in buying in the fall and winter, there could be some opportunities because it might not be as competitive,” Wei said. “There may be a little more negotiation power for buyers.”
From June to July, median home prices dropped 8.5% in San Francisco to $1.46 million, 3.4% in Alameda County to $1.26 million, 3.2% in Contra Costa County to $900,000, 2.7% in San Mateo County to $1.98 million and 1.4% in Santa Clara County to $1.8 million.
For more than a year now, buyers who’ve been able to stomach the steeper rates have been left with few homes to choose from. That’s partly due to the Bay Area’s chronic housing shortage. But many homeowners who might otherwise be willing to sell have also been unwilling to give up the lower rates they locked in before the recent spike.
Sellers now putting houses up on the market are often doing so reluctantly.
“It’s definitely more so out of necessity, and they’re doing so unhappily because they have a direct comparison point to just a year and a half ago,” said Montana Gabrielle Hooks, an Oakland real estate agent.
Hooks said some of her clients have been forced to sell as their employers put an end to full-time remote work. One is stuck selling a recently purchased, spacious new-build in suburban Fairfield after being required to show up to the office in San Francisco.
“They would have never have purchased it if there was even a decent chance that they had to come back to the office so soon,” she said.
What a difference a city makes…in the uber-hot Bay Area, a staggering 43.5% of homes for sale are priced at $1 million bucks or above, according to real estate listing website Trulia.
Compare that to other major metros like Chicago, Dallas, and Philadelphia, where such listings account for fewer than five percent of listings.
In fact, million-dollar listings account for fewer than five percent of all listings in 68 of the top 100 metros nationwide, which clearly illustrates the lopsided distribution of real estate wealth in this country.
If you want to take it a step further, less than two percent of listings are million-dollar homes in 44 of the nation’s largest metropolitan areas.
What Does $1 Million Get You in San Francisco?
The saddest part about San Francisco’s real estate situation is that despite the ridiculous valuations, you don’t get very much for your money, unless you really like fog.
That’s right, for $1 million or more, you only get a median sized home of 1,774 square feet. In other words, you’re probably looking at a townhouse or a condo in the city.
And it certainly won’t be large enough to accommodate your family of four, unless you want to live on top of each other.
Surprisingly, New York City wasn’t even in the top five in terms of percentage of million dollar listings. The Big Apple secured the sixth spot with 20.8% of listings in the $1 million plus category.
It was surpassed by Fairfield County, CT (29.7% share), San Jose, CA (25.7% share), Orange County, CA (24.4% share), and Ventura County, CA (21.5% share).
Rounding out the top 10 were Long Island, NY (), Honolulu, HI (), Los Angeles, CA (), and San Diego ().
It Turns Out Water Is Really Expensive
The takeaway from this list is that being close to the water is HUGE. Of the top 10 million-dollar metros, only one isn’t directly located next to a major body of water.
I’m referring to San Jose, CA, which isn’t on the beach, but still isn’t very far from the San Francisco Bay or the Pacific Ocean.
The rest are a stone’s throw from the nearest beach, making them pretty darn attractive to prospective home buyers.
Their proximity to water also creates a major geographical barrier that limits housing supply, a serious buffer for property values.
In areas that are wide open, supply can be relatively limitless, which doesn’t offer house values much protection.
But back to square footage. Being close to the water also means you get a lot less square footage for your buck.
The top 10 million-dollar metros in terms of least square footage are also situated by the ocean, where median size ranges from 1,489 square feet in NYC to 2,750 square feet in Providence, Rhode Island.
The largest million-dollar homes can be found in Birmingham, Alabama, where the median size is an impressive 8,059 square feet. Of course, it’s about 250 miles to the beach.
You can also get a ginormous home in Toledo, Ohio (7,087 square feet) or Indianapolis, Indiana (7,036 square feet), both of which aren’t anywhere close to a local surf spot.
In fact, all of the top 10 largest million-dollar metros in terms of square footage are landlocked.
So there you have it, water is everything.
Read more: Is Google about to replace your real estate agent?
[Editor’s note: Originally published on Union Street Media.]
This week feels like we are living through history.
Last week at this time, I was in Las Vegas for the Leading Real Estate Companies of the World Conference. Today, I’m writing to you from my attic. So much has changed in such a very short period of time.
Each generation has its coming-of-age: an event that changes the way people think and work. Sometimes those events are singular, such as Pearl Harbor or 9/11. These are the “I remember where I was when” moments.
Other coming of age events transpire over a longer duration of time. My grandparents, born in 1910, survived the Great Depression and World War II. Both forever changed the way they lived. The Vietnam War divided the Baby Boomers and the generation never came back together again. The same has been said of Millennials: the Builders that graduated from 9/11 through the Great Recession and the Firebrands who did after.
I remember a New Yorker cartoon appearing shortly after 9/11 that summed up how I felt at the time. It showed a traveler walking up to an airline desk in an airport. The airline representative says “Where do you want to go” and the passenger responds “September 10th”. Of course, we all know, there’s no going back.
The huge difference between the COVID-19 pandemic and other singular events is that the risk feels so much more personal. I could get sick. I could transmit it to my kids. Or worst of all, I could transmit it to my parents.
I believe COVID-19 will change the way we think, the way we work and how people think about real estate.
The most basic, physiological needs (according to Maslow) are “food, safety and shelter.” If you’ve been to a grocery store this week, you can see the demand for food. Shelter, a roof over your head, and safety are coming together in a way that has not been thought of in the recent past.
Over the past ten years, there’s been a move by Baby Boomers and Millennials into urban areas and away from suburban/rural real estate. No one wants to commute. Everyone wants to walk to work. (One of my theories is that people want to walk to work because they can look at their phones while walking. The same does not apply to driving). Parts of New York City that people would not visit in the 1908’s have completely gentrified and become sought after. What was once considered undesirable, inner-city living is now super trendy.
However, when you are “sheltering in place” in your 700 square-foot apartment in San Francisco, you may re-consider your options. Surrounded by fewer people, such as here in Vermont, you are less likely to get a virus from someone else . . . because a lot fewer someone elses live here.
We’ve seen a number of second home owners come to Vermont since the coronavirus broke out and are hearing similar stories from clients in the Lakes Region of New Hamphire, Cape Cod and Nantucket. Would you want to be living in New Rochelle right now?
Even if people don’t up and leave the city for the country, they’re going to be spending a lot more time inside their homes than they have in a while. Lowes and Home Depot (along with supermarkets) are the only stores open right now. Why? It’s a great time to be working on home renovation projects.
When you spend this much time at home, you see what’s working and what’s not. Three kids under six on the first floor of my house is feeling pretty cozy right now. On the other end of the COVID-19 Winter, I might look for a larger house or call a contractor.
The silver lining for real estate is that despite the panic of today, the reality of tomorrow looks bright. We came into this pandemic with a strong economy and too little housing stock. There is no systemic risk according to Goldman Sachs. The Federal Reserve’s moves will drive interest rates to new lows. There’s a definite pause in activity – now – which is impacting real estate. Unlike the travel, hospitality or entertainment industries, real estate transactions don’t happen overnight. Our industry has time on its side.
As one mentor of mine once said: when orders are down, you can either shut down the factory or retool it. I’m a re-tooler. My advice is to get ready for the post-COVID-19 spring market. It’s going to be a good one.
San Francisco-based fintech Polly has hired Parvesh Sahi, a former executive from ICE Mortgage Technology, as chief revenue officer to scale the business in a highly competitive mortgage environment.
Sahi will be involved in all aspects of the corporate strategy, business development, sales and account management, the firm said Thursday. Sahi brings to the role more than 10 years across multiple executive positions in sales, strategy, client management and business development teams at companies including ICE Mortgage Technology and Ellie Mae.
In his management roles, Sahi helped to identify and execute on multiple key acquisitions and remained committed to driving mortgage innovation, a responsibility that will continue at Polly, the firm said.
“I have no doubt that he will be instrumental in institutionalizing and scaling key areas of our business,” Adam Carmel, founder and CEO of Polly, said in a statement.
Prior to joining Polly, Sahi spent 11 years in executive roles at ICE Mortgage Technology, where he led sales, strategy, client management, and business development teams across the Ellie Mae, MERS, and Simplifile brands. Ellie Mae was acquired by Intercontinental Exchange (ICE) in September 2020.
“One of the many things that attracted me to Polly is the company’s genuine commitment to product execution and delivering on client expectations to meet the evolving needs of lenders, and the industry as a whole,” said Sahi.
Polly, a software-as-service mortgage technology firm that operates a product and pricing engine (PPE) and loan-trading exchange, initially launched in 2019. Since then, the California fintech raised about $57 million in three rounds of funding.
In January 2022, the firm raised $37 million in Series B funding, led by venture capital firm Menlo Ventures. Movement Mortgage, First American Financial and FinVC also joined existing investors 8VC, Khosla Ventures and Fifth Wall.
The SaaS firm teamed up with mortgage insurance providers, including Arch MI, Enact and National MI, to streamline the mortgage process of calculating, quoting and comparing mortgage insurance offerings.
In its latest move to drum up business for lenders, Polly and Mortgage Coach teamed up on a new application programming interface (API) last year. The new API integration feeds real-time data from Polly’s cloud-based PPE into Mortgage Coach’s total cost analysis (TCA) presentation.
This, in turn, will enable borrowers to view accurate, side-by-side home loan comparisons, Mortgage Coach and Sales Boomerang had said in November.
Talk of another housing bubble is not new. In fact, pundits have been fretting about another bubble for over a year now thanks to rapidly rising home prices, with Las Vegas and Phoenix already considered to be bubble markets.
That’s the problem with good news – eventually the pessimists come out and somehow turn it into bad news.
Every quarter, real estate lister Trulia releases its “Bubble Watch” report, which reveals whether home prices are undervalued, overvalued, or just right.
No National Housing Bubble, Yet…
On the national level, the company believes home prices are still undervalued, although not by much.
During the first quarter, they said national home prices were 5% undervalued, which means we aren’t in a nationwide bubble.
However, one quarter ago national home prices were 6% undervalued, and a year ago they were 10% undervalued.
So you can see how quickly we can go from undervalued to overvalued, and eventually to full-blown bubble status.
But with home price appreciation finally moderating, we might be able to buy a little more time before the sky falls again.
For the record, national home prices reached a bubblicious high in the first quarter of 2006, when they were 39% overvalued, before crashing to a low of 15% undervalued in the fourth quarter of 2011.
Local Housing Bubbles Are Forming, Mainly in California
That’s the national outlook, but what about local housing markets? Well, those are a mixed bag, per usual, though there is growing concern in some regions, namely California.
During the first quarter of 2014, 19 of the largest 100 metros were classified as overvalued. That’s the highest number since the fourth quarter of 2009.
Additionally, home prices were overvalued by more than 10% in four large metros, the highest total since late 2009.
Still, it’s nowhere near as bad as the height of the previous boom when all 100 metros were overvalued, with a staggering 91 by more than 10%.
Let’s talk about the new bubbles, all of which happen to be in my neck of the woods. The worst one is in Orange County, California, aka mortgage central.
Home prices in the OC were 16% overvalued relative to their fundamentals in Q1 and asking prices were up 16.9% year-over-year.
Los Angeles, CA wasn’t far behind, with prices seen as 13% overvalued in the first quarter. Asking prices were up 18.9% year-over-year, so clearly homeowners aren’t shy about asking for a little bit more.
Honolulu (13% overvalued), Austin (11% overvalued), and Riverside-San Bernardino, CA (10% overvalued) rounded out the top five most overvalued metros.
Another three of the top 10 overvalued metros can be found in California, including San Jose (+8%), San Francisco (+7%), and Ventura County, CA (+6%).
The Golden State is decidedly bubbly, with eight of the 11 largest metros in California now deemed overvalued, with Bakersfield, Fresno, and Sacramento the lone exceptions.
Where Homes Are Still Pretty Cheap
If you’re looking for a deal, there are still places where homes are cheap relative to their historic norms.
You’ll want to look first in Detroit, Michigan, where home prices are still 20% undervalued.
Nearby Lake County-Kenosha County, IL-WI is also having a sale, with homes 18% undervalued, similar to homes in Cleveland and Toledo, Ohio.
If you’re not a fan of cold weather, head south to the Palm Bay-Melbourne-Titusville, FL metro where prices are 17% undervalued.
Comparable discounts are available in Memphis, Hartford, Chicago, and certain parts of Connecticut.
The takeaway is that a normal housing market will always have areas that are overvalued and undervalued, which is why the experts say to pay attention to your local market, and less so the national story.
And you certainly need to “go local” when determining if it’s the right time to buy or just keep on renting.
In the meantime, let’s enjoy the recovery. We can all start worrying when home prices in every major metro are overvalued (or at least half of them), which they clearly are not.
Monterey Bay Properties is joining Compass, a move that will allow the brokerage giant to expand its Northern California operations, the company announced Wednesday.
Founded in 1980, Santa Cruz-based Monterey Bay Properties includes around 40 agents. For Compass, the merger brings its total number of real estate professionals in the Lake Tahoe, Wine Country, East Bay, San Francisco, Silicon Valley and the Monterey Peninsula areas to more than 5,000.
“We are delighted to announce an exciting new chapter for Monterey Bay Properties,” John Hickey, a broker-associate at Monterey Bay Properties, said in a statement. The team brings “vast collective local real estate knowledge and the willingness to share it within a highly collaborative company culture,” he noted.
Compass recorded a 26% annual drop in revenue to $1.5 billion and a net loss of $46.9 million during the second quarter of 2023. The firm, however, reported positive free cash flow of $51 million, a major milestone for the Robert Reffkin-helmed company. Compass is the No. 1 ranked brokerage in the country by sales volume, after reporting $227.977 billion in sales volume in 2022, according to the 2023 RealTrends 500 rankings.
Contar con una primera o segunda oportunidad de crear crédito con una tarjeta de crédito ha sido más fácil en los últimos años, ya que las empresas de tecnología financiera han creado otras opciones. Estas nuevas tarjetas por lo general evalúan las solicitudes de forma diferente a las tarjetas de crédito tradicionales, con algoritmos y métodos propios que pueden tener menos en cuenta a los puntajes de crédito y fijarse más en factores como sus ingresos o los saldos de sus cuentas bancarias. Los costos más bajos también suelen ser un sello distintivo de estas tarjetas: algunos de estos productos se anuncian sin depósito de garantía (en inglés), sin cuota anual y sin tasa APR (en inglés).
“Muchas fintechs (compañías de tecnología financiera) se enfocan mucho en ofrecer productos a personas que de otra manera no calificarían para ellos en una institución grande”, dice Nick Roberts, director de marketing de Grow Credit, una empresa de tecnología financiera con sede en California. “Algunas fintech se enfocan mucho en ampliar el mercado”.
Si bien muchas de estas empresas relativamente nuevas pueden ayudarle a acumular crédito, hay que tener en cuenta que a veces el camino puede ser accidentado, ya que la empresa que está detrás de la tarjeta sigue expandiéndose.
Anticipe cambios
Todas las empresas de tarjetas de crédito, ya sean o no tradicionales, pueden modificar las condiciones de su cuenta (en inglés), aunque dependiendo de lo que cambie exactamente, deben seguir ciertas pautas.
“Tienen que avisarle con 45 días de anticipación de un aumento de la tasa de porcentaje anual y de cualquier cambio significativo en las condiciones”, dice Lauren Saunders, directora asociada del National Consumer Law Center.
Aun así, en comparación con una tarjeta de crédito más reconocida, una tarjeta alternativa de una fintech tiene más probabilidades de sufrir cambios frecuentes en sus condiciones y funcionalidades. Estas actualizaciones pueden ser novedades bien recibidas o también reducciones frustrantes.
Por ejemplo, una empresa de tarjetas de crédito relativamente nueva puede cambiar de marca o nombre, lo que significa que podrían variar muchas de sus funcionalidades. CreditStacks anunció una tarjeta de crédito con su nombre en 2018, pero en 2020, tanto la empresa como la tarjeta pasaron a llamarse Jasper (en inglés), enviando tarjetas rediseñadas y ampliando el grupo de solicitantes que podrían cumplir los requisitos. Con el tiempo, Jasper pasó a ser una tarjeta de devolución de efectivo para personas con buen crédito.
A pesar del nuevo lanzamiento y rediseño, la tarjeta de crédito de Jasper dejó de existir en 2022.
Grow Credit estrenó una tarjeta de crédito en algunos estados en 2019, y la extendió a todo el país en 2020. La tarjeta permite acumular crédito utilizándola para pagar determinadas facturas o cuentas, hasta un límite bajo de gasto mensual. Está vinculada a un plan de membresía con varios niveles y precios, incluida una opción gratuita. Pero al momento de su lanzamiento, la tarjeta solo contaba con un nivel gratuito.
Con el tiempo, la empresa ha ido incorporando los demás niveles de membresía, que pueden desbloquear y permitir facturas adicionales y límites de gasto mensual más elevados. Según Roberts, estas incorporaciones crearon más opciones de generación de crédito para las personas sin crédito.
Ojo con lo que le llegue a su correo electrónico
TomoCredit, una empresa de tecnología financiera con sede en San Francisco, también ha introducido cambios significativos en las condiciones originales de su tarjeta de crédito. La tarjeta debutó en 2021 sin cuota anual, pero en 2023 las condiciones incluían una cuota mensual (en inglés) de $2.99 y la tarjeta quedó en lista de espera.
La fintech Petal lleva varios años en el sector de las tarjetas de crédito, anunciando tarjetas gratuitas o con cargos bajos para clientes que buscan generar crédito, así como para los que tienen un buen historial crediticio. Sin embargo, en mayo y junio (ambos en inglés) de 2023, Petal informó a determinados titulares de tarjetas existentes de que estarían sujetos a una nueva cuota mensual de membresía.
Jamie Howard, un director de e-learning en Tennessee, era uno de esos titulares. Le dijeron que tendría que pagar una cuota mensual de $8 dólares u optar por no pagar y que le cerraran la cuenta. “Al principio me sorprendió, porque no me agrada tener que pagar cuotas”, dice Howard. “Si opto por no participar, es un componente de tu puntaje de crédito”.
La clausura de una cuenta puede perjudicar el puntaje de crédito (en inglés), ya que podría afectar la utilización del crédito y acortar la antigüedad del historial crediticio. Esa era precisamente la principal preocupación de Howard, dado que había solicitado la tarjeta Petal para generar crédito. Sin embargo, después de unos tres años con la tarjeta, decidió que la cuota mensual no valía la pena porque tiene otras tarjetas de crédito. “Desde entonces me salí del programa”, dice.
Controlar las expectativas
Como en el caso de cualquier producto financiero: investigue antes de solicitarlo. Dependiendo de la empresa de tecnología financiera que se trate, es posible que usted no obtenga la misma experiencia que ofrece un banco tradicional, lo que puede ser parte del compromiso.
“Un problema crónico con las fintech es la falta de servicio humano al cliente”, dice Saunders. “Una de las formas en que pueden abaratar los costos es eliminando las sucursales, eliminando el servicio al cliente en vivo, confiando en el chat y otros canales automatizados o electrónicos. Eso funciona bien, hasta que llega el momento en que uno necesita más”.
No todas las empresas de tecnología financiera funcionan de esta manera, pero es importante saber a qué atenerse. Las opiniones de los clientes en Internet pueden servir de ayuda. Podría ser de provecho obtener una tarjeta, si le ayuda a acumular crédito cuando otras opciones son demasiado caras o le han rechazado una tarjeta de crédito tradicional.
Conforme vaya mejorando su crédito, contar con una nueva tarjeta de crédito (en inglés) de un emisor más consolidado puede servirle de respaldo en caso de que cambien las condiciones de su tarjeta alternativa.
Este artículo fue redactado por NerdWallet y publicado originalmente en inglés por The Associated Press.