Category Archives: NAWRB Magazine

NWBC Entrepreneurial Ecosystems & Their Service of Women Entrepreneurs

Posted on by Desiree Patno
Pg1
15 Jun

Women entrepreneurs are on the rise, and they are leaving their footprint on the nation’s economy. In 2012, the U.S. Census Bureau reported an estimated 9.9 million women-owned firms, 35.8 percent of all U.S. firms classifiable by gender, and the total estimated receipts from those firms was $1.4 trillion.

Nevertheless, women-owned businesses are still an underrepresented segment in the economy and require support for their continued growth. The National Women’s Business Council (NWBC) is providing insight on how federal and regional stakeholders can help.

In April of this year, the NWBC released Entrepreneurial Ecosystems & Their Service of Women Entrepreneurs, a research report conducted with Washington CORE, which analyzes local entrepreneurial systems to identify influential actors and mechanisms that aid, or present a barrier to, the support and growth of women-owned businesses.

The report utilizes the “entrepreneurship ecosystem” model, which Washington CORE defines as “a set of interconnected entrepreneurial actors, entrepreneurial organizations, institutions and entrepreneurial processes which formally and informally coalesce to connect, mediate and govern the performance within the local entrepreneurial environment.”

This approach, the report explains, “emphasizes the importance of the overall environment within which an
entrepreneur establishes and grows her business,” helping us understand the resources she can leverage, as well as gaps within the economy that may hinder her.
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Is the Mortgage Industry Painting with too Broad a Brush?

Posted on by NAWRB
Pg1
15 Jun

Becoming a homeowner helps safeguard a person’s professional achievements and can pull them out of poverty. However, current mortgage lending trends show that a significant portion of Americans are being all but excluded from homeownership by stringent credit-assessing practices leading to mortgage rejections.

The Great Recession, which saw nearly 8 million American homes fall into foreclosure, highlighted the risks and issues in housing boom mortgage lending; it was this financial crisis that set the scene for the Dodd-Frank Act of 2010, which imposed rigid standards for home loan qualification.

Recent research by Alberto Rossi and Francesco D’Aunto, assistant professors of finance from the University of Maryland’s Robert H. Smith School of Business, shows that following the passage of Dodd-Frank, mortgages obtained by middle-class households decreased by 15 percent. Aiming to protect the economy, financial institutions and prospective homebuyers, these regulations have at times overburdened the mortgage process, leaving Americans stagnant in their journey to a better future.

When it comes to lending, is the mortgage industry painting with too broad a brush?

Minorities
Pew Research Center data reveals that Black and Hispanic homebuyers experience significantly higher difficulty obtaining conventional mortgages than whites and Asians, and usually pay higher interest rates when they are approved. Mortgage rejection is one contributor to the homeownership rate disparity of Black (41.3 percent) and Hispanic (47 percent) households in comparison with white households (71.9 percent).

According to Pew Research Center analysis of Home Mortgage Disclosure Act (HMDA) data, in 2015, 19.2 percent of Hispanic applicants and 27.4 percent of black applicants were denied mortgages, compared to 11 percent of white and Asian applicants. For Blacks, credit history is the number one cited reason for mortgage rejections; for the three other groups, debt-to-income ratio was the foremost explanation.

Contributing to lower affordability, mortgage rates also enact an uneven impact on homebuyers. In 2015:
• 60 percent of Black householders and 65 percent of Hispanic householders had mortgage rates below 5 percent, compared to 73 percent of white householders and 83 percent of Asian householders
• 18 percent of Hispanic householders and 23 percent of Black householders had mortgage rates of 6 percent or more, compared to 13 percent of white householders and 6 percent of Asian householders

In addition to these mortgage difficulties, an emerging trend is a significantly smaller and less diverse mortgage applicant pool. Pew reports that in 2005, about 10 percent of conventional mortgage applications were from Black households, and 14 percent came from Hispanic households. In 2015, less than 4 percent of these applications came from Black households, and fewer than 7 percent were from Hispanic households.

The inequality in mortgage accessibility and interest rates is formidable, meaning that a disparate amount of Black and Hispanic households are unable to achieve homeownership like their white and Asian counterparts. One issue that must be understood in order to successfully navigate the future of the industry is the reason behind the sharp decline in conventional mortgage applications.

Is poverty the main factor?

U.S. Census Bureau data shows that poverty levels of Hispanic and Black households are actually decreasing. From 2014 to 2015, Hispanic poverty level declined from 23.6 to 21.4 percent, and the median annual income of Hispanic-origin households rose 6.1 percent, from $42,540 to $45,148. Similarly, the poverty level of Black households decreased to 24.1 percent from 26.2, and their median annual income increased 4.1 percent, from $35,439 to $36,898.

Are Americans losing the desire to own homes?

While the role of poverty cannot be underestimated, it is necessary to assess the other aspects at play. As recent U.S. Census Bureau data affirms, the 63.6 percent homeownership rate in the first quarter of 2017 was not statistically different from the 63.5 percent rate in the first quarter of 2016 or the 63.7 percent rate in last year’s fourth quarter.

This means that in the past year, the homeownership rate has neither worsened nor improved, but it has been on a steady decline since 2006. Mortgage rates, which have hit historic lows in recent years, add another piece to the puzzle.

According to the Federal Housing Finance Agency (FHFA), the average interest rate on all mortgage loans increased in December (3.91 percent), January (4.17 percent) and February (4.25 percent) before dropping 13 basis points in March (4.12 percent). The FHFA House Price Index (HPI) also reveals that home prices went up 6.2 percent from the fourth quarter of 2015 to the fourth quarter of 2016. The flex in interest rates and rising prices could be outweighing the benefits of homeownership for prospective buyers.

Women
Women are another market expressing uncertainty towards the housing market. Like minorities, women face roadblocks when procuring mortgages. A new study from the Urban Institute, Women Are Better than Men at Paying Their Mortgages, describes that when examining loan performance for the first time by gender, women’s lower credit scores do not indicate weaker performances, and women actually perform better than men. The report found that female-only borrowers actually default less than male-only borrowers. For mortgages originated from 2004 to 2007, the default rate for female-only borrowers was 24.6 percent, compared with 25.4 percent for male-only borrowers.

Despite this repayment performance, single borrowers, particularly women, have higher mortgage rates; from 2004 to 2014, the average rate for female-only borrowers was 5.48 percent compared to 5.41 percent for male-only borrowers. A 2011 Journal of Real Estate Finance and Economics study also shows that on average, women pay more for mortgages than men; women’s mean interest rates are .4 percent higher than men’s. While the repayment figures are not statistically different, women perform on par with men, emphasizing the lack of evidence-based explanation for the higher mortgage rates women experience.

In some demographics women even depict higher homeownership rates than men. In 2015, the homeownership rate of female householders in 1-person households was 24.56 percent higher than the homeownership rate of male householders in the same category, according to Census Bureau data on national household demographics.

There remains the question; do women want to become homeowners? When analyzing the benefits, homeownership may not be a desired step, especially if women are single and have only one paycheck. With lower incomes and higher mortgage rates, women experience a tougher time paying back their loans, and their interest rates make accumulating wealth through homeownership a discouraging task. It isn’t difficult to recognize that for some women, homeownership can seem like a more prudent step in the future.

Credit
On the road to access mortgages, Americans’ relationship with banks is often center stage. The FDIC’s 2016 biennial National Survey of Unbanked and Underbanked Households shows:

• 7 percent of households were unbanked, having no account relationship with an insured institution
• 19.9 percent of households were underbanked, encompassing households in which a person had a bank account, but still resorted to alternative financial services providers throughout the year
• The survey found that 27 percent of households, or 90 million Americans, were unbanked or underbanked
• The following segments have a higher probability of being unbanked or underbanked
o 42 percent of households with incomes below $30,000 per year
o 49 percent of African American households
o 46 percent of Hispanic households
o 46 percent of households headed by a working-age individual with a disability

Without a solid baking relationship, it is hard for a person to have credit scores that satisfy current mortgage lending standards. Unbanked and underbanked describes millions of families in the United States, meaning millions of people without the benefits of homeownership and an economy missing out on their buying power.

The recent Bankrate Financial Security Index found that only 52 percent of Americans have more money in emergency savings than credit card debt, and 24 percent have more credit card debt than emergency savings; 17 percent remain in the middle with no savings or debt. These figures emphasize the importance of protecting what little savings consumers have. As the U.S. continues to recover from a recession that saw millions of people’s homes and life savings slip out of their hands, the need for banks and financial institutions that protect consumers’ savings through sound financial practices is paramount.

Irresponsible lending led to the worst recession in recent history, but stringent standards are effectively preventing Americans from accessing mortgages, homeownership, and creating better lives. People capable of repaying home loans should be allowed the opportunity to do so, and those not in a position to obtain mortgages need to make the necessary changes to situate themselves for homeownership, such as opening a bank account. With rising prices, unpredictable interest rates and a stagnant homeownership rate, actions need to be mindful in order to empower today’s American homebuyers and would-be homebuyers.

Women’s Homeownership Series: Hope

Posted on by NAWRB
Pg1
15 Jun

Hope and her husband, with their two daughters, moved into a beautiful 3 bedroom, 2 bathroom home in Boulder, Colorado two-and-a-half years ago. Previously living in a smaller 2 bedroom condominium a few miles away, the family enjoyed the comfort and convenience of a larger space. Their daughters, Rose and Isabelle, were happy to have their own private rooms and a backyard to practice soccer in after school.

Since the couple divorced a few months ago, Hope has taken full responsibility of the $2,500 rent. When she is not busy managing a popular clothing department store, she enjoys spending time with her daughters and painting. She aspires to feature her eclectic paintings in a gallery at the thriving art district in North Boulder, a place she frequents with friends.

Hope has fortified her career with over 20 years of hard work and dedication. Despite not having a college degree, her weekly earnings of $762 exceed that of the average female worker with only a high school diploma. She, however, earns less than the median weekly income of women ages 25 and older with a bachelor’s degree or higher.

Hope’s ex-husband provides $1,200 of monthly child support to help with expenses. Nevertheless, both her income and child support are not enough to continue living at the house with adequate savings for an emergency fund or retirement plan. More than 50 percent of her $3,050 monthly paycheck goes to rent, not including utilities.

Common advice from financial planners is that, at most, a person should spend 30 percent of their income on housing expenses. Hope is already experiencing the burden of not having leftover income to put in savings. With additional living expenses, she only has $200 left every month for unexpected costs and the occasional take-out meal with her daughters.
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The Changing Landscape of Single-Family Rental Homes

Posted on by Diane Tomb
Pg1
15 Jun

The Single-Family Rental (SFR) industry is growing fast, attracting families, millennials and baby boomers alike, who are drawn to the flexibility of renting. Our residents are America’s teachers, police officers and military families looking to rent homes in good neighborhoods with good schools.

According to the U.S. Census Bureau’s American Community Survey (ACS), the percentage of renters electing to live in a single-family home (both attached and detached) has consistently grown over the last several years, rising from roughly 31 percent in 2005 to approximately 35 percent in 2015.

While the SFR industry is not new, the professionalization of it now offers residents access to quality rental housing as rental demand grows. The Green Street Single-Family Rental Primer estimates 3.9 million new renter households between 2016 and 2020, which equals 1.5 million new units of single-family rental demand.

I turned to some of the smart, dynamic women in our ranks to get their take on our industry and the role we play within the housing landscape. They are enthused and passionate about their work and the future of the SFR industry.
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Vicky Silvano AREAA 2016 National Chairwoman

Posted on by NAWRB
Pg1
15 Jun

1. What is the experience of being the chairwoman of an organization like the Asian Real Estate Association of America (AREAA)? What was your favorite part of your work as chairwoman and your proudest achievement?

Getting to the onset of being the leader of a big organization is overwhelming. Coming from the most quintessential immigrant story that you can think of, it was the first time I would be leading a huge organization. Obviously I’ve been president of smaller groups, but this was kind
of overwhelming.

The fact that I was entering a leadership role where increasing homeownership within the AAPI community is a big goal was something to look forward to. It was nerve-wracking, but I was really looking forward to what I was going to be able to do and achieve within my time as president.

It was a great and very interesting time for me; it was good timing. My family was very supportive and important to me getting into this leadership role.

My proudest achievement was the successful “No Other” Campaign that we had, but a significant part of my work is visiting all of our chapters and really looking at the grassroots level because that is where I thrive. I’m able to connect with these professionals and make sure the chapters are sustainable and doing the necessary things to contribute to AREAAs collective success. Going into “No Other,” we really became unified and made a concerted effort to focus on the campaign.

I’m a people person. I like talking to and connecting with all the chapter leaders and members, making sure that we’re moving towards the same goals and working to increase the homeownership of our community. The members are really the biggest thing for me; without membership there is no AREAA. Reaching out to them, chapter leaders and members, is the fun part for me.

This connects to my meetings with top executives from the lending institutions we work with; I know who they are, and they know who I am. I’m more of an execution type of person than the talking type.
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The Future of Small Businesses

Posted on by NAWRB
Pg1
15 Jun

With limited employees, capital and resources, small businesses are hit the hardest by rigorous regulations, and the expense of compliance often poses sustainable growth roadblocks for the entrepreneurs who need it the most. The following months could prove especially pivotal for small business owners, as the possibility of new legislation and regulations grows.

Access to Credit
A vital decision on the horizon is the possible repeal of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which has constrained some mall businesses and homebuyers seeking access to credit. As data from the Federal Reserve Bank of St. Louis shows, in the six years prior to Dodd-Frank, small bank lending surpassed large bank lending by over 150 percent. In the six years after the bill’s passage, small bank lending sits nearly 80 percent below lending from large banks.

The bill’s stringent credit qualifications have arguably limited Americans in their personal and professional lives, increasing the difficulty to access business capital and home loans. The possible repeal of Dodd-Frank could mean easier access to credit for millions of businesses, increased homebuyers and a stimulated economy.
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The Movers & the Shakedown

Posted on by Stephanie Hughes
Pg1
15 Jun

America has long been crowned as the land of dreamers, the land of opportunity, and if you work hard enough and remain diligent, there is nothing you can’t achieve. The wealth is in land and labor, and it’s that which accumulates, you can control, and pass on to the next generation. Black people are not very active in the home buying market today and the likelihood of changing this outlook is bleak. As the Pew Research Center reports, in 1994, 42.3 percent of black households owned their homes; in 2016, their homeownership rate is 41.3 percent. The dream of homeownership is fleeting for black households stemming from being a historically disadvantaged group. As we look at the effects of the foreclosure and unemployment crisis resulting from the Great Recession, an optimistic outlook is hard to find.

In examining the contributing factors and consequences of the 2007-2008 foreclosure crisis, the ramifications of housing discrimination against black householders, then and now, remain virtually unchanged. With the influx of stable employment and easily accessible mortgages, many Blacks were able to participate in the American dream of homeownership. But with the ease and accessibility of ownership came subprime loans, manipulated interest rates and overpayment of homes. It was a ticking time bomb.

Across the nation, black homeowners were disproportionately affected by the foreclosure crisis, with more than 240,000 of them losing their homes. In a 2014 article investigating the foreclosure crisis, Nathalie Baptiste presents staggering facts regarding the deterioration of black wealth. She states that the foreclosures affected blacks of all income brackets, and high-earning blacks were 80 percent more likely to lose their homes than their white counterparts.
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Women’s Housing Growth: Winning in Heels

Posted on by Adenike Fasanya-Osilaja

Globally, women are finally entering into boardrooms without having to knock, and they are not just there to serve the coffee. We are managing businesses, large or small, employing multiple solutions without trepidation, and jack hammering every glass ceiling in our way, or at least taking a shot at it. We are standing up for our truths, flaunting our power suits, high heels and unique personalities without apology. In 2015, according to the National Architectural Accrediting Board (NAAB), 44 percent of the graduates in its accredited college program were women. The 2016 National Association of Realtors (NAR) Member Profile reveals that women comprise 62 percent of Realtors in the U.S. market, 21 percent also hold broker licenses and 16 percent hold broker associate licenses. Additionally, women in real estate are no longer limited to salesperson roles, but are builders, welders, roofers, plumbers and environmental assessment experts. It is important to explore just how difficult the journey has been, and to celebrate the fact that we continue to face our challenges head on, impacting our industry sectors positively just by taking up and owning our spots.

At birth, three words determined your life for the foreseeable future—“It’s a girl”—and your journey began. Do you get an education? Do you attend the same schools, participate in the same activities and take the same classes as the male siblings in your family, or do your parents provide you with less, expecting you to grow into a docile young woman who should be seen and not heard? Hopefully the former applied in your case, and off to school you went, pink backpack, pretty dress and all, and life as you knew it changed forever.

According to a study conducted by the Harvard Graduate School of Education’s Making Caring Common Project, the “glass ceiling” concept is identified as early as middle school, with girls being
multiple times less likely to gain acceptance into leadership
positions, even by other girls in their grade. One of their most surprising findings was that 23 percent of girls preferred a male student in leadership, and only 8 percent preferred a female leader. Conversely, male students were 40 percent more likely to prefer a male leader, and only 4 percent were more likely to prefer a female.
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2017 Women’s Collaboration without Baggage

Posted on by NAWRB
Pg1
15 Jun

Over the past decade women have made significant strides in the women’s movement, uniting in greater numbers and forming groundbreaking organizations. Within this progress, it is necessary for women to collaborate without holding back; if we cannot thrive together, we are breaking the unity and leaving some women behind. Whether it’s between best friends, family, social media followers, casual acquaintances or the press, it is crucial for women to express support for one another. The camaraderie in our forward-thinking, intense conversations should be felt as we recognize and celebrate our work and achievements.

Collaboration
What holds you back in this collaboration? What is your baggage? As women, we can often be each other’s worst enemies; which, given the obstacles we’re already facing, is entirely counterproductive. Rather than celebrate another woman’s successes, we criticize or downplay her achievements. We see another woman’s successes as a reflection of our own missed opportunities or failures. In other words, we compare ourselves to each other as if we are competitors in the race to success.

However, by seeing other women as our partners, and not competitors, we can help push each other to the finish line. One woman’s win is a win for all women, just as any achievement in gender equality affects us all.

Women are born multi-taskers, and with each generation—augmented by our own desire to compete harder and faster—more and more is put on our plate. Women’s habit to burn the candles at both ends has had direct consequences, notably in the fact that heart attacks are the leading cause of death among women. By focusing our efforts, and especially by helping one another, we can advance the women’s movement and lighten the weight on our shoulders by working smarter.

While we are seeing improvements in the gender wage gap, more needs to be done to reach gender parity.

Women’s Movement
Driven by the fight for equality, the many focuses in the women’s movement can at times delay our progress. We need a defined foundation, a common ground on which we can all stand and advocate in the movement for equality.

Perhaps different groups can agree on an issue like eliminating the gender wage gap, but disagree on a separate women’s issue. Should they work towards the ideal upon which they see eye to eye, or allow their differences to prevent their collaboration?

If you dig deep enough, you will eventually find something about a person with which your views do not align; but any work or progress you’ve made together doesn’t have to go down the drain. This is not the correct or productive thing to do.

Having different opinions is common, and it’s okay for women to be involved in one aspect of the women’s movement without participating in another. We must be united in spite of our differences, not driven apart by them. Being united as one force does not mean that we forget what makes us different; unity amidst diversity requires that we acknowledge our differences as unique experiences and strengths that each can bring to the table.

A balanced platform allows women to be united under defined ideals, wants and beliefs without leading to disagreements about other points of view. To build a foundation from which we can collaborate for change, we need to distinguish the core values that underlie the different sectors in the women’s movement. There must be a belief that motivates each of the issues we promote, such as the right for equality or freedom. Discovering what our issues have in common will help us form a frame for a cohesive, directed force. This is important not only in moving us forward in achieving shared goals, but also in making our cause distinguishable to others because everything we support and advocate for will be connected to the bigger picture.

Each of us focusing on disparate problems will not provide enough impetus for change. Without a foundation on which we can all stand together, we lack the collaborative spirit necessary for the women’s movement to grow and flourish. Right now, we are carrying many token bags, each holding a singular issue, which is preventing us from getting enough traction; however, we can increase our mobility with a heavy-duty, compartmentalized backpack which can hold the many issues and values that matter to us. This backpack is the only baggage we need.

Raising Your Bottom Line: Capitalizing On Your Business Classification-Women-Owned

Posted on by Desiree Patno
Pg1
15 Jun

In today’s competitive business arena, a minute detail or decision can mean the difference between long-term success and immediate failure. In the real estate industry, where networking and connections play such a significant role in business performance, what you and your business connote is particularly vital.

As a professional in this highly competitive marketplace, not utilizing the business classifications at your disposal is an oversight. A strategy as old as the industry itself is tailoring to your community. You must play to your strengths, and increasing your business’s appeal to a particular market including potential homebuyers is essential. For women business owners, the utilization of women-owned business classification is vital.

According to 2014 Census Bureau data, there are currently 18,057,000 female homeowners in the United States. As women make advancements in their careers and their wages grow in parity to those of men, women’s homeownership will continue to grow. With this extended buying power, we are seeing the emergence of more women homeowners and a specialized niche for real estate professionals. This growing market is evidenced in the fact that 10 million American women homeowners live alone.
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