Q&A 3

with

Marcia Davies Chief Operating Officer at the Mortgage Bankers Association

How to create more space for women in mortgage

Here are some things women can do to champion each other

Marcia Davies not only serves as the chief operating officer at the Mortgage Bankers Association, but she also founded and leads the association’s networking platform for women in the real estate finance industry, mPower.

As a mentor and advocate for women in the industry, HousingWire interviewed Davies on its female financial empowerment podcast, Girlfunds, to learn more about leadership and what women can do to better support other women.

HousingWire: What is one statistic around women in the workforce that has always stood out to you?

Marcia Davies:Recently, a Harvard Business Review report caught my eye. Companies with the most ethnically diverse leadership teams are 33% more likely to outperform their peers on profitability, and specifically speaking to women, those with executive-level gender diversity worldwide had a 21% higher likelihood of outperforming their industry competitors. The data stands the test of time and highlights how diversity, and specifically gender diversity and leadership, is good business. So simply stated, the more diverse your leadership team is overall, the more profitable and successful your company will be.

HW: What was it like starting out in our industry as a woman and what changes are you seeing in this?

MD: I started in the industry 30 years ago, and you’re right, there weren’t many women in the industry. As I grew in my career, there became more and more frequent times when I was the only woman in the room. I didn’t have a network of other women that I could go to and bounce ideas off of, or to talk about challenges I was having.

What would have been helpful is having a group like mPower, or more women around where we could talk about what we were facing, and problem solve together and make sure that our male counterparts were aware of some of the things that we were facing in the workplace.

And I think about “imposter syndrome.” It’s that little voice in your head that makes you question, “Can I do this? Should I really be here? I was ‘lucky’ to get here?”

It would have been helpful as I was navigating my career to know that was a real thing. I just thought it was my own self-doubt.

HW: How can we create more opportunities within our industry and even outside to help create more space for other women to succeed and lead?

MD: I love being asked questions that are actionable. I think we need to mentor, sponsor and lift women up. It sounds simple, but as you know, when everybody’s busy at work, sometimes you forget that you need to make the time to sponsor and lift other women up.

And if you’re fortunate enough to be in a leadership role, I do believe it’s your responsibility to send that elevator back down and lift other women up so that they can have opportunities. They can really have the advantage of someone investing in them to make sure that they are successful so they can thrive.

The other thing is, we have to be able to sponsor and support women. You may have a colleague who, whether young or a seasoned professional, doesn’t often speak up for the great work that they’re doing. So, when you’re in a meeting, and it’s appropriate to mention that Sally did this amazing work where people can be made aware of it, we should leverage it. You need to be the person who can sponsor that woman when they’re not in the room and also help advocate for them.

As women, we are not usually strong advocates for ourselves. We assume our good work is just going to be recognized. Well, ladies, we have to learn to toot our own horn. And I’m not saying do it to the point where we’re going to blow it, but we do need to make sure our good work is recognized. I always say to tell people what you’ve accomplished and I guarantee you, it’s more than they even realized.

with

Michael Neal Senior Research Associate in the Housing Finance Policy Center at the Urban Institute

The history of housing discrimination

What does inequality within housing mean for today’s borrowers?

When it comes to housing inequality, there is a lot of history to unpack. In Honest Conversations, a new podcast miniseries that focuses on minority homeownership, HousingWire Digital Media Manager Alcynna Lloyd interviews different housing experts to examine the state of minority homeownership in America.

In this interview, Michael Neal, a senior research associate in the Housing Finance Policy Center at the Urban Institute, discusses the history and data behind minority homeownership and explains how inequality within housing came to be and what it means for today’s borrowers.

HousingWire: How did new economic structures in suburban spaces of the post-war period influence housing inequality and affluence?

Michael Neal: Number one, in aggregate, I think things were moving upward for sure. That being said, the devil is in the details. And what we really observed was that a certain category of people were able to take advantage of these opportunities and use them for their good, and others were actively and consciously excluded from them.

Additional housing in the suburbs certainly allowed particularly white Americans to access the credit and to access the opportunities to move into those neighborhoods. And over a period of time, to experience the benefits or the financial benefits, at least, in the form of price appreciation and broader equity.

But I think that there was a certain group of people, particularly people of color, who by and large did serve their country, who were actively and consciously excluded from these opportunities and were not allowed into these new-fangled suburban communities.

And by and large, they were, therefore, not able to benefit due to housing discrimination, at least to the same degree.

HW: In the 1950s, when many middle- and lower-class white Americans were moving to the suburbs with the help of the government, data shows many African Americans and other minorities were systematically shut out. What were some of the laws or rules that prevented them from accessing equal housing? MN: Redlining is one that really comes to mind, and the covenants and rules that were put into those covenants that kept people of color from achieving homeownership in those particular communities. Laws, such as redlining, kept people from getting a mortgage, and therefore, they weren’t being able to access homeownership.

We’ve really described two steps. We described rules that kept you from achieving homeownership, but then, we described, given that you weren’t able to achieve homeownership, you were not able to access it in the places that could give you the maximum amount of benefit.

Over time, that’s going to build on itself and lead to, I believe, a portion of the gaps that we see today with respect to homeownership, and with respect to wealth more generally.

HW: What is your biggest area of concern for minority homeownership? And what can the industry do today to address this gap?

MN: For me, I think that the biggest concern that I have is that African Americans and Hispanics, in particular, are not experiencing the benefits of homeownership to the degree that their white counterparts are. That is, even if we were somehow to close the gap in homeownership, the gap, with respect to the financial benefits of homeownership, remains wide for a number of reasons. Part of which I think are rooted in a history of systemic racism and housing discrimination. Part of which are the economics that currently prevail.

So, I encourage both myself in my own research and analysis, but also for the industry more generally, that it’s not enough to get African Americans and Hispanics into homeownership. We must also take the extra steps and implement the necessary policies to ensure that these new homeowners actually benefit to the same degree as the other Americans are able to.

PeerStreet program aids real estate entrepreneurs from undeserved communities

Company aims to stop “negative flywheel” kudos

By Tim Glaze

Following the murder of George Floyd in 2020, PeerStreet CEO Brew Johnson knew his real estate investing platform needed to get involved with forwarding social change.

That led to the launch of PeerStreet’s cause. Tidal Loans shares that passion.” “Evolving Neighborhood Uplift Fund,” a “Tidal Loans’ main goal in its involvement charitable initiative used for a more pur- with E.N.U.F is to be a part of a program that poseful and sustainable way to invest in inspires and enables our next generation of real estate entrepreneurs from underserved Black real estate investors,” said Ozougwu. communities. Ozougwu is just one of a handful of menThe E.N.U.F. advisory board reviews and tors and advisors with different areas of exselects ten entrepreneurs who best meet pertise who are partnering with the initiative eligibility requirements, including demon- to help others create wealth. strating a passion for real estate investing and community improvement, while identi- BUILDING WEALTH THROUGH REAL fying as a member of a minority group and ESTATE of an underseserved “We are passionate about democratizing the community. ability to create wealth through real estate,” According to Johnson said. “The social unrest that unPeerStreet, the mission folded following the murder of George Floyd of the new initiative is really underscored the unequal playing field, “to equip aspiring real the disparity in wealth and the lack of investestate entrepreneurs ment in black communities – which are huge with the tools and capi- factors in the racial inequities we see today.” tal they need to invest in The economic statistics are shocking, as real estate projects and, Johnson pointed out: white communities in doing so, invest in receive four times the investment that black their communities.” communities do, he said, and the average Once candidates are white household has 10 times the wealth accepted to the E.N.U.F. of the average Black household. And, the project, they will re- Federal Reserve reported in August that the ceive mentorship from average homeowner in 2016 had a housePeerStreet’s network hold wealth of $231,400, compared to the of real estate experts, average renter having a household wealth of matching with people just $5,200. like Jason Lewis, who is Fast forward to a February study by the Cheta Ozougwu, Investor at Tidal Loans the CEO and founder of United States Census Bureau that shows simAryMing Capital. In addi- ilar data around inequality. The homeownertion, when they identify qualifying projects, ship rate for white Americans in the fourth the capital needed will be funded out of a quarter of 2020 was 74.5% – a nine-year charitable giving vehicle, hosted by the Tides high, and surpassing the fourth quarter of Foundation. 2019’s rate of 73.7%. Homeownership rates Cheta Ozougwu, an investor at Tidal Loans for Black Americans dipped to 44.1%, the and one of the mentors in the program, said, lowest rate since the first quarter of 2020. “With the disparity in resources and knowl- Even considering American cities with edge available to Black investors, it is truly a larger Black populations, the homeownerblessing that PeerStreet co-founder and CEO ship gaps are alarming. Washington, D.C. Brew Johnson is so passionate about this and Los Angeles, for instance, show a gap

kudosof 25% between white and Black homeownership. Or, to boil everything down: the homeownership gap between white and Black Americans is larger today than it was 50 years ago. And that’s with mortgage rates falling to historic lows amid the COVID-19 pandemic. With rates expected to return to semi-normal and home prices still high, homeownership could continue to be a problem for Black Americans.

CREATING THE IDEA FOR E.N.U.F.

As Johnson watched the raw emotions of the Floyd case spill over on the news, he felt helpless. In response, he gathered his team in June and brainstormed ideas that would help make a difference. The idea for E.N.U.F., he said, was born.

“After we thought about the wealth gap problem in the context of our business and our goals of cre-

Jason Lewis, CEO and Founder of AryMing Capital ating a level playing field, unlocking a reinforcing cycle of wealth creation, American Rescue Plan and community invest- – currently earmarked at ment, it became apparent $1.7 trillion for the econothat we didn’t need to wait my – includes $100 billion up in. Because Black famiaround for someone else for affordable housing lies on average have fewer to make a change,” he and a $15,000 first-time assets it’s harder for them said. homebuyers tax credit that to access capital to start

When individuals invest can be used creating wealth. in loans on PeerStreet, as a down “When investhe capital is distributed payment. tors buy loans through a network of small In the mean- from PeerStreet, business lenders to real time, Johnson they earn interest estate entrepreneurs said PeerStreet on their investaround the country. Those is doing what ment which is entrepreneurs then use it can with the great, but the that money to buy prop- resources it ecosystem that erties, fix them up, then has – without investment suprent them out or sell them waiting for the ports is even to homebuyers. To date, PeerStreet has allocated government. “We love to Ashley Flucas, General Partner of Flucas Ventures more important – their invested approximately $4 billion see government capital gets allocatof capital ed to small to real businesses estate “I know first-hand that real estate is a and real entrepreneurs powerful economic driver to accomplish estate entre preneurs,” around this goal and helping others to be able Johnson the to grow wealth through real estate is said. country. “In very exciting." - Ashley Flucas “I know first-hand a way, that real we’ve cre- estate is a ated a wealth-generating support and think housing powerful economic driver machine,” Johnson said. for everyone is important,” to accomplish this goal “At the same time, there he said. “But I don’t think and helping others to is a massive wealth gap in anyone should wait for the be able to grow wealth America and the numbers government or someone through real estate is very are just shocking.” else to fix things or make a exciting,” added Ashley

President Joe Biden change. We believe that we Flucas, general partner has been a proponent of have the power, collec- of Flucas Ventures and a affordable housing since tively, to make an impact founding advisor to the he launched his presiden- and create a better future. E.N.U.F. project. tial campaign, and his That’s what drives our mission at PeerStreet, and the E.N.U.F. program is a natural extension of that mission.” The goal with E.N.U.F., Johnson said, is to reverse the negative flywheel minority families are caught

parting shot

❱ UWM’S RECORD-BREAKING YEAR

United Wholesale Mortgage showed it is a force to be reckoned with once again, announcing it generated more than $1.3 billion in net income during the fourth quarter of 2020. And for the entire year, UWM originated more than $182 billion in mortgages, blowing away the $107.8 billion in mortgages it delivered in 2019 as the market boomed. To start out the year, the company also had its public debut on the New York Stock Exchange pictured above with Alex Elezaj, chief strategy officer, Melinda Wilner, chief operating officer, Mat Ishbia, president and CEO, Jeff Ishbia, founder and board member and John Tuttle, NYSE vice chairman and chief commercial officer (left to right).

“We’re taking it up another level – allowing clients to connect directly with you.”

Austin Niemiec Executive Vice President Rocket ProSM TPO

We’re putting you front and center – right where you need to be – with a national Broker Directory on RocketMortgage.com, one of the most visited mortgage websites in America. More than 11 million people visit the site every month. That’s using the power of the Rocket brand to build yours. It’s also showing your clients the power of local brokers and Rocket technology.

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