Wednesday, May 30, 2007

Crabtree: Real estate insiders against 'truth'

From today's Bakersfield Californain:

Appraiser to stop releasing reports
Crabtree: Real estate insiders against 'truth'

BY VANESSA GREGORY, Californian staff write

Local real estate appraiser Gary Crabtree announced in a letter Monday that he will no longer provide news media with monthly reports that examine the local real estate market, saying that his business has been damaged because "industry insiders don't want to hear the truth" about a troubled market.

As a result, local lenders have ceased to give him appraisal assignments, Crabtree said in his letter, citing a similar "persecution" during the real estate recession of the '90s.

Michael Burger, a local commercial and residential appraiser, said that many home appraisers are probably coping with less business in a changing economy.

"Everything that has to do with the housing trade is slowing down," Burger said.
In his letter, Crabtree wrote that lenders have been asking appraisers to "hit" values in violation of the industry's ethical standards.

"That is absolutely true," said Ted Faravelli Jr., a spokesman for the California Association of Real Estate Appraisers. "I'm ashamed to say that."

Pressure on appraisers to deliver a desired home value is increasing as the real estate market cools, Faravelli said.

Recently, Crabtree has also alerted local, state and federal agencies to suspicious real estate transactions that he thinks may be examples of real estate fraud.

His letter bemoans a lack of interest on the part of regulatory agencies in this alleged criminal activity.


Jim said...

Crabtree should get an award from the county and the city of Bakersfield for coming forward. Is this going to happen, hell no. Why, because the local goverment has been hurt by Crabtrees remarks and reports to the FBI..ect.

The fact of the matter is the city and county do not care about the false appaisals, there making $$$ off property tax and fees.

Anonymous said...

I agree....I think the real scary part about all this is the lack of investigation and accountability.

Bakersfield Bubble said...


I agree also.

Although I have disagreed with some of his other comments and predictions, I commend him for coming forward when no one else would.

Where are all the other REIC members? Are they part of the problem, is that why they remain silent and punish this guy for telling the truth?

Benjamin Franklin said...

Sadly, any comments that are perceived as being "bad for business" are instantly viewed with suspicion as a threat to "the economy", REGARDLESS of how true they are. Sadly, we're addicted to the crack cocaine of a hot real estate run-up, and EVERYONE wants the illogical to continue. Remember, Greenspan himself said the sub-prime meltdown problem could have been avoided IF ONLY home prices rose ANOTHER 10%! How ridiculous: then what happens after THAT?

Even worse though, people who speak the truth (like Crabtree) are viewed by some as the CAUSE of the slow-down, when logic should tell anyone with a brain larger than a pea that the market correction is NOT just a Bakersfield problem, but an expected 'normal' event (although, yes, the cycle peak was MUCH LARGER in amplitude) in the real estate cycle occurring nationwide! But don't blame the bearer of bad news (and we all know how well THAT advice is accepted).

All the more reason for people (especially so-called real estate professionals) not to get swept up in the bubble frenzy, where they start playing fast and loose with the rules! Some members (e.g. Crisp) seem to think of home as a good vehicle for gambling, ALA the roulette wheel at Vegas! Some cannot resist trying to rig the game, and placing all their money on black!

This kind of problems happen when people get greedy, and start taking more for themselves than is reasonable in an up-market. Any RE member who DIDN'T know (or realize) this was a bubble in it's cycle is part of the problem! Anyone who didn't tell clients that what goes up MUST come down is part of the problem, and deserves to lose their license!

Sadly, that seems to include the National Association of Realtors, the California Association of Realtors, Mortgage Brokers Association, Mortgage Bankers Association, Appraisers boards, Department of Real Estate, etc.

When it comes to bubbles, I think the official stance is 'deny, deny, deny', and as pointed out, the regulators have been so ham-strung by Bush's laissez-faire ideations that even trying to enforce existing laws designed to prevent such abuses (e.g. mortgage fraud) is a pointless effort. Heck, fraud is good for hitting the numbers, too....

People get the kind of government and rules they deserve, and this is one example of how THAT principle plays out.

At any rate, kudos to Crabtree and the Californian for trying to speak the truth amidst the din of moronic babble from salesmen and money changers...

Adam Smith said...

FWIW, here's an update on the scam that was being run down in Riverside Co. (Temecula/Murietta) that appears very similar to what Crisp appeared to be doing with his network of 'investors'

So while the wheels of justice and regulation aren't exactly fast, apparently the squeaky wheel gets the grease from the DRE, FBI, etc.

Adam Smith said...

Here's a story from Fresno on an unlicensed individual operating as an appraiser, without oversight from his employer who IS a licensed appraiser:

Fred said...

It is too bad that our Police Department and District Attorney will not take such action on the fraud that has taken place in Kern County.

Anonymous said...

Carl Cole defaulted on a million dollar loan today, more information later.

Anonymous said...

anon! Nice! Keep it coming!

Anonymous said...

5/30/2007 Default Notice

5/29/2007 Default Notice

05/21/2007 Default Notice