President Biden’s administration is stepping up to combat racial bias in home valuations. Announced by Vice President Kamala Harris, a new rule in the works mandates financial institutions to ensure fairness in their appraisal algorithms. As an upbeat new step towards transparency, this initiative aims to prevent lower valuations for homes owned by people of color.
It also brings an easier path for consumers to appeal valuations they suspect to be biased. Remember, home ownership is a major source of wealth for American families. However, data indicates Black and Latino homeowners often face undervaluation of their homes, raising their mortgage costs. In fact, only 5% of home appraisers are people of color.
Two years ago today, in remembrance of the Tulsa race massacre centennial, President Biden launched the Property Appraisal and Valuation Equity (PAVE) task force — a leap to help ensure homes owned by people of color are fairly valued.