MARCH 12, 2002 – Now, two studies of millions of appraisals by the American Enterprise Institute (AEI) and Fannie Mae have concluded that there is no racial bias in real estate appraisals.
For those involved in the industry, this comes as no surprise. It is essentially impossible for real estate appraisers to be biased. Probably 95% of the time the appraiser knows nothing about the physical characteristics of the borrower. Nearly 100% of the time the appraisal reviewers know nothing about the borrower. And ALL appraisals must be approved by a reviewer.
Also, the market sets prices and all appraisers do is analyze recent comparable sales and arrive at a value for the subject. Which, in purchase situations, is equal to or higher than the sales price 95%+ of the time.
Racist organizations like the Brookings Institution and others that are falsely complaining about appraisal bias need to ‘follow the science’ as they like to say. Scientific studies 100% conclusively say there is no appraisal bias.
Maxine Waters and President Biden owe the appraisal industry an apology. And so does the Appraisal Institute for not supporting its own members.
The real estate appraisal industry is the gold standard for an unbiased profession. We have been the independent referee for 80+ years.
Lastly, we all know about the Fair Housing Act, redlining, discrimination being illegal, et al. To say we need to be educated about such is ridiculous. If you have lived in America since the 1970’s, you know all about fair housing laws and what is and is not discrimination.
The true racists are those that accuse everyone else of being racist. These people need to be exposed and told where to stick their unfounded claims. They should be sued for slander and defamation, also.
Hey, Appraisal institute, get a backbone and stand up for your members! There is no legislation that can change 4,000+ years of economic theory. The appraisal industry does not need to make any changes. It is already fully diverse and inclusive of people of all socio-economic classes (I grew up in mobile homes and am Jewish….I have the low-priced housing and minority characteristics covered!). Remember, skin-color and the only two genders have nothing to do with diversity and inclusivity.
Shalom,
The Mann
Tag Archives: bias
STUDY CONCLUDES THAT APPRAISERS ARE NOT BIASED
JANUARY 8, 2021 – The American Enterprise Institute has published a study about the possibility that appraisers have intentional or even unintentional racial bias. Their conclusion is:
We conclude allegation that knowing the race of the applicant results in racial bias by appraisers on refinance loans is uncommon and not systemic. This same analysis supports the conclusion that unintentional bias based on race is also uncommon and not systemic.
You can find the article and link to the report at:
It would be nice if the racially biased Brookings Institute would issue an apology to the appraisal industry. But, racists have an agenda and do not apologize. Thankfully, there is access to actual data and entities like the AEI can analyze and report the facts.
Basically, it is simply impossible for the appraisal industry to be racial or gender biased. Probably 99%+ of the time appraisers know nothing about the physical characteristics about the borrower in residential transactions. Also, every appraisal report is reviewed and I would say near 100% of the time the reviewers know nothing about the borrower at all.
AVMs are often used in the residential arena and they know nothing about the borrower nor the subject’s neighborhood, et al. To them, data is data. Finding the best comparables is based on analyzing numbers. That simple. And for the most part, it is the same for human appraisers.
There is one group of people in real estate that can have significant bias. I won’t name them. You can probably figure it out. There might actually be a few groups involved in this arena that can have bias. That is not to say it is widespread and rampant.
For those who want to keep the ‘conversation’ going, provide the AEI report. You will see how fast the other side wants to stop the conversation and change the subject:)
Great work AEI. I hope they will now do a study about the 20 million whites that live in poverty and see what it is about their neighborhoods that is common and how action can be taken to improve their standard of living….and housing. At the same time, I am sure those solutions can help everyone that lives in poverty. Remember, poverty is colorblind.
The Mann