Zone1 How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods

[IM2]

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods

Previous Brookings research found that homes are undervalued in majority-Black neighborhoods, yet could not identify why. Recently, the Federal Housing Finance Agency released new neighborhood-level data on home appraisals. Using this data in combination with other sources, this report draws the following conclusions on home appraisal bias’s effect on housing markets in majority-Black neighborhoods:

We continue to find that homes in Black neighborhoods are valued roughly 21% to 23% below what their valuations would be in non-Black neighborhoods.

Adjusting for characteristics of homes and neighborhoods, we find that appraisal transactions in majority-Black neighborhoods are 1.9 times more likely to be appraised under the contract price than homes in majority-white neighborhoods.

We estimate that the median appraisal is 15% lower in majority-Black neighborhoods compared to homes in neighborhoods where less than 1% of the population is Black.

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods | Brookings

Contents Summary Understanding devaluation New data on appraisal bias Estimating lost appraisal value Re-estimating the devaluation of homes in Black neighborhoods Conclusions and limitations Metro area dashboard Summary Previous Brookings research found that homes are undervalued in...

www.brookings.edu

And this underappraisal creates lower property values and that affects school funding. So again simple minded one liners about the need for blacks to emphasize education more does not cover everything that goes on.

 

[Godboy]

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods

Previous Brookings research found that homes are undervalued in majority-Black neighborhoods, yet could not identify why. Recently, the Federal Housing Finance Agency released new neighborhood-level data on home appraisals. Using this data in combination with other sources, this report draws the following conclusions on home appraisal bias’s effect on housing markets in majority-Black neighborhoods:

We continue to find that homes in Black neighborhoods are valued roughly 21% to 23% below what their valuations would be in non-Black neighborhoods.

Adjusting for characteristics of homes and neighborhoods, we find that appraisal transactions in majority-Black neighborhoods are 1.9 times more likely to be appraised under the contract price than homes in majority-white neighborhoods.

We estimate that the median appraisal is 15% lower in majority-Black neighborhoods compared to homes in neighborhoods where less than 1% of the population is Black.

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods | Brookings

Contents Summary Understanding devaluation New data on appraisal bias Estimating lost appraisal value Re-estimating the devaluation of homes in Black neighborhoods Conclusions and limitations Metro area dashboard Summary Previous Brookings research found that homes are undervalued in...

www.brookings.edu

And this underappraisal creates lower property values and that affects school funding. So again simple minded one liners about the need for blacks to emphasize education more does not cover everything that goes on.

News flash, black neighborhoods fucking suck. No one wants to move there, hence the low values.

 

[White 6]

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods

Previous Brookings research found that homes are undervalued in majority-Black neighborhoods, yet could not identify why. Recently, the Federal Housing Finance Agency released new neighborhood-level data on home appraisals. Using this data in combination with other sources, this report draws the following conclusions on home appraisal bias’s effect on housing markets in majority-Black neighborhoods:

We continue to find that homes in Black neighborhoods are valued roughly 21% to 23% below what their valuations would be in non-Black neighborhoods.

Adjusting for characteristics of homes and neighborhoods, we find that appraisal transactions in majority-Black neighborhoods are 1.9 times more likely to be appraised under the contract price than homes in majority-white neighborhoods.

We estimate that the median appraisal is 15% lower in majority-Black neighborhoods compared to homes in neighborhoods where less than 1% of the population is Black.

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods | Brookings

Contents Summary Understanding devaluation New data on appraisal bias Estimating lost appraisal value Re-estimating the devaluation of homes in Black neighborhoods Conclusions and limitations Metro area dashboard Summary Previous Brookings research found that homes are undervalued in...

www.brookings.edu

And this underappraisal creates lower property values and that affects school funding. So again simple minded one liners about the need for blacks to emphasize education more does not cover everything that goes on.

Don't feel bad. Mine would be worth easily 5 times as much in a good neighborhood in California, compared to Jackson, Tennessee. Real estate is about location, location, location.

 

[BackAgain]

If black people (a majority of those in a neighborhood which is essentially a “black” neighborhood) don’t care to have white people moving in and doing some sin like “gentrification,” then maybe that’s the actual racial bias that affects property valuation.

 

[DGS49]

Haven't you ever heard the real estate axiom, "location, location, and...wait...I'l think of it. I can't remember that third thing.

Where a house sits it CRITICAL to its value. A thousand square foot condo is worth millions in Manhattan and fifty thousand in Syracuse. It's worth twice as much in Manhattan as Brooklyn.

African American neighborhoods are likely to have more litter, more crime, poor schools, inferior landscaping, and so on. OF COURSE a property in such a neighborhood will be valued lower than in a comparable "white" neighborhood. This is why all the Black folks who can do so, get out.

Furthermore, even if a given appraisal is less than it "should be," so what? If it's a tax appraisal the homeowner saves money. If it's make by a real estate agent in the context of selling it, the homeowner can always insist on a higher price and it will sell if the price is right.

So what's the problem?

 

[MarathonMike]

Previous Brookings research found that homes are undervalued in majority-Black neighborhoods, yet could not identify why.

Welcome back! So this confused me until I looked up who is doing research at Brookings Research, From their website:

Brookings brings together more than 300 leading experts in government and academia from all over the world who provide the highest quality research, policy recommendations, and analysis on a full range of public policy issues.

 

[MarcATL]

If black people (a majority of those in a neighborhood which is essentially a “black” neighborhood) don’t care to have white people moving in and doing some sin like “gentrification,” then maybe that’s the actual racial bias that affects property valuation.

So you agree that the properties are devalued based on race.

You're growing.

 

[johngaltshrugged]

The fact a majority black neighborhood is more likely to be located in a poor location with high crime has nothing to do with this, right?
Maybe keep the neighbors from stealing the A/C unit & ripping out the copper pipes during the appraisal...

You should stop playing the victim card & start taking responsibility for your own poor decisions because casting blame hasn't worked so well for y'all so far.

 

[Oldestyle]

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods

Previous Brookings research found that homes are undervalued in majority-Black neighborhoods, yet could not identify why. Recently, the Federal Housing Finance Agency released new neighborhood-level data on home appraisals. Using this data in combination with other sources, this report draws the following conclusions on home appraisal bias’s effect on housing markets in majority-Black neighborhoods:

We continue to find that homes in Black neighborhoods are valued roughly 21% to 23% below what their valuations would be in non-Black neighborhoods.

Adjusting for characteristics of homes and neighborhoods, we find that appraisal transactions in majority-Black neighborhoods are 1.9 times more likely to be appraised under the contract price than homes in majority-white neighborhoods.

We estimate that the median appraisal is 15% lower in majority-Black neighborhoods compared to homes in neighborhoods where less than 1% of the population is Black.

How racial bias in appraisals affects the devaluation of homes in majority-Black neighborhoods | Brookings

Contents Summary Understanding devaluation New data on appraisal bias Estimating lost appraisal value Re-estimating the devaluation of homes in Black neighborhoods Conclusions and limitations Metro area dashboard Summary Previous Brookings research found that homes are undervalued in...

www.brookings.edu

And this underappraisal creates lower property values and that affects school funding. So again simple minded one liners about the need for blacks to emphasize education more does not cover everything that goes on.

Appraisals in large part are based on comps, IM2...other properties that are similar and from the same area. That's not a "biased" appraisal...it's a representative appraisal. An appraiser looks at what a 3 bedroom - 2 bath ranch sold for a block away from the 3 bedroom - 2 bath ranch they are appraising and base their value on that selling price and others like it. Appraisers aren't there to promote racial equity...they're there to put an accurate value on property.

 

[BackAgain]

So you agree that the properties are devalued based on race.

You're growing.

Not what I said. But nice try.

What I’m saying is that black racist attitudes toward whites can cause harm to a black community.

Reality. Truth. Fairness. Objectivity. Grow on that.

 

[IM2]

Appraisals in large part are based on comps, IM2...other properties that are similar and from the same area. That's not a "biased" appraisal...it's a representative appraisal. An appraiser looks at what a 3 bedroom - 2 bath ranch sold for a block away from the 3 bedroom - 2 bath ranch they are appraising and base their value on that selling price and others like it. Appraisers aren't there to promote racial equity...they're there to put an accurate value on property.

Bs. Now stop trying to deny what the evidence shows.

 

[IM2]

The fact a majority black neighborhood is more likely to be located in a poor location with high crime has nothing to do with this, right?
Maybe keep the neighbors from stealing the A/C unit & ripping out the copper pipes during the appraisal...

You should stop playing the victim card & start taking responsibility for your own poor decisions because casting blame hasn't worked so well for y'all so far.

Nothing you claim has anything to do with it. Go talk to the people at Brookings who did this study. We don't cast blame, our grievances are documented.

 

[IM2]

Everybody,

READ THE ARTICLE! This is from the Brookings Institute and it's nationwide. It's time to stop the denials.

 

[Oldestyle]

Bs. Now stop trying to deny what the evidence shows.

Comps are comps, IM2. An appraiser's job isn't to balance house prices between racial neighborhoods. The job is to put as accurate a value on the property as possible so financing that property can be done...not inflate or deflate values because of racial inequity.

What the "evidence" shows is that properties in black dominated areas don't sell for as much as properties from predominantly white areas. Appraisals reflect that. That doesn't make the appraiser racist.

 

[MarcATL]

Not what I said. But nice try.

What I’m saying is that black racist attitudes toward whites can cause harm to a black community.

Reality. Truth. Fairness. Objectivity. Grow on that.

Nope! You already said it. Can't take it back now.

I do appreciate your growth.

 

[MarcATL]

Comps are comps, IM2. An appraiser's job isn't to balance house prices between racial neighborhoods. The job is to put as accurate a value on the property as possible so financing that property can be done...not inflate or deflate values because of racial inequity.

What the "evidence" shows is that properties in black dominated areas don't sell for as much as properties from predominantly white areas. Appraisals reflect that. That doesn't make the appraiser racist.

Your response just goes to show your bigoted ignorance.

How does your claptrap account for the raising of value when all one has to do is remove any evidence of Blacks living in the home and have it reappraised?

Snap out of your racist stupor dunce!

 

[BackAgain]

Nope! You already said it. Can't take it back now.

I do appreciate your growth.

I stand by what I’ve said.

You would too if you weren’t full of shit. As usual.

 

[Oldestyle]

Your response just goes to show your bigoted ignorance.

How does your claptrap account for the raising of value when all one has to do is remove any evidence of Blacks living in the home and have it reappraised?

Snap out of your racist stupor dunce!

Comps have nothing to do with who lives in the house, Marc. It's using sales of comparable houses in the same neighborhood. There IS racism in the sale of housing and has been for hundreds of years but not in the appraisal of houses! If an appraiser DID artificially inflate the price of a home to make things more "equitable" they'd be leaving themselves open for a law suit by the bank or the new buyer.

 

[BackAgain]

Your response just goes to show your bigoted ignorance.

How does your claptrap account for the raising of value when all one has to do is remove any evidence of Blacks living in the home and have it reappraised?

Snap out of your racist stupor dunce!

Your racist response shows how ignorant you are. But don’t take that personally. My view is that all you racists are ignorant.

I can’t help your stupidity. But, I can try to educate you. You evidently didn’t bother to grasp the import of the “argument” offered in the OP.

There we “learned” that white people are racist because banks and real estate appraisers have a tendency to set lower market values in all black communities.

But the trouble isn’t that whites set the value. The problem involves black racists (like you) who are so full of irrational (and ignorant) racist disdain for white people, that you don’t care to allow any of “those people” to live in your pure black neighborhoods. And without an influx of at least SOME white neighbors, the values don’t go up.

You go back sticking your head in the sand now. It doesn’t matter to me.

Also, you REALLY need to reconsider your random and silly bolding. It comes across as cheap and comical.

 

[IM2]

Comps have nothing to do with who lives in the house, Marc. It's using sales of comparable houses in the same neighborhood. There IS racism in the sale of housing and has been for hundreds of years but not in the appraisal of houses! If an appraiser DID artificially inflate the price of a home to make things more "equitable" they'd be leaving themselves open for a law suit by the bank or the new buyer.

Yada, Yada, Yada. There is racism in the appraisal process. That has been proven. No matter what the topic, or how much proof those like you are shown, you claim that no racism exists.