NewsUS NewsScripps News

Actions

New class tackles bias, diversity in real estate appraisal industry

A new pilot program at American University is trying to diversify the real estate industry and tackle appraisal bias.
New class tackles bias, diversity in real estate appraisal industry
Posted at 9:53 AM, May 05, 2023
and last updated 2023-05-05 11:53:10-04

Across the landscape, the American dream can loom large, anchored by homeownership.

What a home is worth, though, often comes down to what an appraiser decides it is.

A study from the Brookings Institution shows that for Black, Hispanic and Asian homeowners, their houses are often undervalued by double digits. 

That is something Carlette Duffy said last year she experienced firsthand, after several appraisals seemed low to her. So, she removed any items and photos from her home that showed she was Black and asked a White friend to show the home to an appraiser.

The result: a new appraisal that was tens of thousands of dollars higher for her home.

"It's just so painful and hurtful to be treated like this," Duffy said.

Ericka Simmons is an appraiser and one of the few Black women who is a member of The Appraisal Institute, the country's largest association of real estate appraisers. She said Duffy's experience is not surprising.

"There's a history of exclusion, and it surfaces in things like bias and appraising," Simmons said.

Becoming a real estate appraiser often requires finding one that will take on a trainee.

"It's basically almost like a guild," she said. "If you want to be an appraiser, you have to study under someone who is an appraiser. You have to work and gain experience under someone who's a licensed appraiser."

SEE MORE: Home selling mistakes that can cost you thousands of dollars

That can limit who becomes an appraiser. However, a change is underway through a new class at American University.

It is a pilot program to try to diversify the industry and tackle appraisal bias. Simmons is the instructor.

"There are these things that exist that I hope that this class helps to weed out in all facets of real estate," Simmons said.

According to the U.S. Bureau of Labor Statistics, more than 90% of property appraisers in the country are White, and 70% are men.

"What we're trying to do is we're trying to get that awareness in front of the students and those who would otherwise not have considered the appraisal profession," said Craig Steinle, president of the Appraisal Institute. 

The Institute partnered with American University to create the pilot program class, which will soon expand to a dozen Historically Black Colleges and Universities and one where the majority of students are Hispanic.

"That means that our population will look more like the population in the communities that we serve," Steinle said, "and that, in and of itself, will go a long way toward eliminating even the potential for people to feel that there is some sort of valuation bias in the work that we do."

Michael Hsiao decided to enroll in the class at American University.

"This class kind of brings a lot more opportunities and real-life kind of case studies for us," he said.

Hsiao said he also sees the potential for improving the real estate appraisal industry.

"Professor Simmons, as a female and as a minority, she really inspired me and a lot of people," Hsiao said.


Trending stories at Scrippsnews.com