VP Harris Releases Plan to Stop Bias in Home Appraisals
Vice President Kamala Harris on Wednesday unveiled an action plan to stop racial discrimination in the appraisal of home values.
The 21-step plan seeks to improve oversight and accountability in the home appraisal business. It includes a legislative proposal to modernize the governance structure of the appraisal industry.
“A home appraisal is a critical element of the home buying and lending process, intended to provide an independent, fair, and objective estimate of the market value of a property so that lenders can accurately evaluate risk,” the administration stated in a Fact Sheet.
“Homeownership is the primary contributor to wealth building for Black and brown households and continues to hold promise for building multigenerational wealth and housing stability for households of color. But, bias in home valuations limits the ability of Black and brown families to enjoy the financial returns associated with homeownership, thereby contributing to the already sprawling racial wealth gap.”
Administration officials said the median white family holds eight times the wealth of the typical Black family and five times the wealth of the typical Latino family.
According to a recent study, eliminating racial disparities in the wealth families gain from owning a home would narrow the wealth gap by an additional 16 percent between Black and white households and an additional 41 percent between Latino and white households.
On June 1, 2021 – the centennial of the Tulsa Race Massacre – President Joe Biden announced the creation of the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE) to develop a transformative set of actions to root out racial and ethnic bias in home valuations. The Task Force has now released the PAVE Action Plan.
The White House said when the plan is enacted, it will represent the most wide-ranging set of reforms ever put forward to advance equity in the home appraisal process. U.S. Department of Housing and Urban Development Secretary Marcia L. Fudge and Domestic Policy Advisor Susan Rice co-chairs the Task Force.
The Action Plan details a set of commitments and actions, most of which can be taken using existing federal authorities, that will help every American to have a chance to build generational wealth through homeownership.
As part of the action plan, the government will expand the complaint hotline for the Department of Housing and Urban Development and the Consumer Financial Protection Bureau. There also will be appraisal bias training in homebuyer education classes and efforts to ensure that the computer systems used to value homes do not perpetuate racial biases.