New real estate study finds some positives in the struggle against appraisal bias

WASHINGTON, D.C. – The National Association of Real Estate Brokers released Home Appraisals in Black and White: Disparities in the Estimated Valuation of Homes by Neighborhood Racial Composition, a comprehensive study of appraisal bias Oct. 24. The study found some narrowing of contract price undervaluation gaps and reduction of disparities in appraisals in Black neighborhoods compared to White communities. Substantial progress was made in specific cities, offering hope for environments where Black intergenerational wealth can thrive.& The study identified two types of appraisal bias: the gap between median appraisal values of homes in Black communities relative to similar-quality homes in White neighborhoods and “contract price undervaluation,” which is the share of appraised homes that fail to meet or exceed the price set by sellers in sales contracts.Related Stories “HUD recognizes that appraisal bias is a significant barrier to fair housing and economic opportunity, particularly for communities of color who are most affected by undervaluation and discriminatory practices,” said HUD Acting Secretary Adrianne Todman. “It not only limits the wealth-building potential for families but also perpetuates a cycle of inequity in our housing market. I commend NAREB for their leadership in releasing this important report and advancing collective efforts to ensure...