Reforms to Home Appraisal Bias Target Algorithms and Tech
To tackle racial disparities, new White House initiatives are focused on regulating home valuation algorithms and diversifying the appraisal industry.
US Vice President Kamala Harris speaks about a federal Property Appraisal and Valuation Equity (PAVE) report in March 2022. This month, she announced several new reforms to reduce racial bias in appraisals.
Photographer: Samuel Corum/Bloomberg
The White House unveiled several new action steps this month aimed at reducing disparities between how homes in white neighborhoods are appraised compared to neighborhoods of color.
According to the Federal Housing Finance Agency, homes in majority-Black neighborhoods are valued, on average, at less than half of those in neighborhoods with few or no Black residents. Further research has found that the dollar value of the appraisal gap between homes in white neighborhoods and non-white neighborhoods has almost doubled since 2013, from $211,000 to $408,000.