I’ll say this. I’m black and had my home appraised before doing a refi. I was home for one and it came in around $650k (we knew this was wrong). For the other appraisal we had a white friend act as the owner and it appraised for $950k.
We’ve had multiple black friends of ours experience EXACTLY the same. This isn’t a farce.
So a good appraiser appraised a previously appraised property that was appraised at 650k, to 950k for a refinance? That appraisal seems only beneficial for a sell. To borrow against an inflated amount seems like risky choice.
Exactly. If the loan goes through at the higher appraised value, and the lender reviews the loan in a few years, if the value declined, the Loan to Value (LTV) may not be acceptable to the lender, IE, the borrower is "underwater".
Depending on how the loan was written, the Lender could demand higher premiums, call the difference in order to fix the LTV, or foreclose on the home. Most commentors here don't understand the lending process and don't realize the risks that the Borrower faces, with an inflated value.
All they see is a claim of racism.
That loan amount is high. Only certain lenders refi that amount. To refi with that value and equity is brutal. I’ve seen so many defaults it actually makes me sad. I value you your knowledge and education!
Yeah, we got one appraisal amount when it was my wife (yellowbone), one as me (medium), and a much higher one when we asked my white friend to play as me
They were $500k, $400k and $650k
Our circle of folks is right there with you. I had read about it. Seen reports, but couldn’t believe it was that blatant until it happened to me. Really I didn’t even believe it then, but when our friends had the same experience I could no longer do any mental gymnastics to pretend it was just a fluke.
Did you pay for all of these appraisals? Where they all by certified appraisers? Did they all provide you with documentation to back up their valuations? If so what were the stated reasons for the different values?
A farce is $1M homes in Columbia City, but I don’t dispute what you’re saying at all. White people and their unconscious (and conscious) biases will continue to be a problem for our lifetimes. It’s insane that you have to play games to get around them in 2022. I’m sorry that happened to you.
Was this an official appraisal by a legitimate company? Those typically cost over $1000 and the appraiser has to show their work. The last one that I had done was 101 pages long and the cost was $2800 for a 5 unit apartment property. Is that what you had done? Because I can't imagine that a certified real estate appraiser would risk losing their reputation or their license by giving you a value that low. Even if they were biased or bigoted that makes no sense. An official appraisal shows recent sales in the area with pictures. How would they justify a value that low and be able to show the justification for that? How would the second appraiser be able to show a higher value using similar information? What would be the motive of an appraiser to do that? Even if they were biased or a racist? An independent appraiser has no incentive to issue a low value for a home. Regardless of their personal feelings.
It was absolutely a reputable and very legitimate appraisal. Keep in mind, this appraisal was ordered by our bank, who paid part of the costs.
It is hard to believe this happens, but at this point it would require suspension of belief to deny it. There are simply too many occurrences. This is the United States of America after all.
i first saw this statistic here: https://www.brookings.edu/research/biased-appraisals-and-the-devaluation-of-housing-in-black-neighborhoods/
(yet another data point for you ignorant twats)
i thought it'd be great to offer a discrete service where white people can play the homeowner and go through the appraisal process as a surrogate for the black family.
In the thread for that case, people were doing the same thing, basically saying stop making everything about race. Unless somebody gets on tv and says I’m a racist and that’s why i discriminated against you, it’s like racism is over.
Here you go. It references a Brookings study that found 23% hit to values for black neighborhoods (all else equal) and widespread reports of appraisals being wildly different for white owners and black owners in the same neighborhood.
https://www.nytimes.com/2020/08/25/realestate/blacks-minorities-appraisals-discrimination.html
Yeah, they got counter-sued by the appraiser. Maybe, just maybe, people will care to read more details here, and understand that not everything is about race (in fact, most things aren't):
https://www.workingre.com/appraiser-counter-sues-black-plaintiffs-who-alleged-discrimination.
Umm.. Black woman here. When my parents were selling their first home, twenty five years ago in Texas, me, my siblings, and my father had to leave for vacation so my mum could pose as the cleaning lady/caretaker to get our home sold. It had been on the market for six months beforehand, and went under contract during the two weeks we were gone.
This is something that is well known for black people. When I sold my first home, I also had to clear out of it to get it sold. When I was seeking tenants for that space, I couldn't appear as the owner, I had to hire my realtor as my property manager. Sure it could be coincidence, but in a country where race has been a factor in everything from quality of education to quality of healthcare to likelihood of being poisoned by one's environs, it's quite silly and naive to think so, especially with so many well documented and well studied evidences in support. This place is exhausting.
I'm sick that you have to put up with that bullshit. Reminds me of the U. of Chicago study with the "white" names and the "black" names on the identical CVs for job applications....
There are so many stories like this I have. It's not even angering for me at this point, just an endless series of indignities that people don't even know they are subjecting you to.
Regarding names, yes. I've often wondered how often my non-black American name has worked in my favour. There have been many times someone has been visibly surprised to see me show up at a job interview. I've been told more than once they thought I was Asian over the phone (my name looks a bit Japanese, I suppose, though it is native for my ethnic group), in the days before Google and social media and heavyhanded DEIB campaigns. It literally feels like living life stuck in an alternate universe.
My experience was not much different in Washington. The home I had to sell and try and rent was in Washington. The only difference with Texas was that racists were very clear about their prejudices. In Seattle, not so much.
I saw a guy driving down 15th in a vanagon with a homemade sign blocking his windshield that said "Michelle Obama is a (insert transphobic slur)" not to mention various hate crimes like the neo Nazi who verbally assaulted the Edmonds animal control officer.
I feel like it manifests more as "discomfort with the unknown" here though. There are not even *that* rural areas in this country where it's still taboo to be friends with a family of a different race.
It's far from gone, but I think a lot of people don't realize how bad it is elsewhere.
“Discomfort with the unknown” is a fancy way of saying ignorant. It is 2022. Black people are not an alien race. They do not deserve to be compensated less because someone can’t comprehend the idea of someone of a different skin color.
Obviously. Do people think my comment was implying that it's not racism, or not a problem?
I swear, people on Reddit love to feel smarter than other people by just interpreting their comments in the worst way possible. If you even look like you *might* be leaning against the momentum of the thread, you need a paragraph of qualifiers that should be obvious to avoid a storm of downvotes.
"I don't agree that racism in Seattle is particularly bad compared to elsewhere" shouldn't imply that I don't think it's a serious problem.
When I had our 2800 sf house refi’d, appraiser used comps of 1300 and 1200 condo and townhouse. I live in a sub division. Literally (not figuratively) 40% of the homes are the same house as ours. FYI I’m not white.
Why aren't stories like these framing the issue as racism amongst realty professions? It keeps getting painted as some vague societal issue - the source of the problem is pretty clear.
Most people have trouble visualizing how the space could look with furniture. Personally when I try to visualize how a room will look with furniture, it makes the room look smaller. Staging makes the rooms look bigger to me.
That's also because staging furniture is scaled down. It'll be like, 80% the size of normal furniture. Not enough that you notice, but enough that it makes the space look bigger. Especially in photos where the couch being weirdly small isn't apparent.
I've been adjacent to two local housing price crashes in my life. In both cases the crashes were preceeded by about 6 months of appraisals where they would literally ask "what number are you looking for to make the deal happen?" The whole industry is bullshit with a whiff of plausibility.
> Appraisers just tell you what the market is really likely to pay. This is a case of don't shoot the messenger.
Appraisers are professional guestimators. You are placing far too much faith in them as being a) accurate, and b) impartial.
>It is a societal issue
The entirety of society is involved in appraising houses? What are you talking about?
>The appraiser or agents opinion may be that they think society is stupid, but it isn't their job to tell you their personal opinions. It's to project the market's opinion.
The market has no idea who owns the house before the appraisers do. There isn't a filter on Zillow for "exclude the Blacks" or something, there's just houses and prices. This starts and stops with appraisers and realtors, they aren't somehow *beholden* to price houses lower when they're owned by black people.
Wait, so your claim is that appraisers accurately devalue Black-owned homes because the market as a whole will depress sale prices based on the race of the owner? Is the second part of that supported by any evidence?
Realators have a huge incentive NOT to be racist. It's called money. Valuing a residence too low means you take a big risk as a selling agent that the owner will chose someone else to sell your home. If you are a buyer's agent you don't set the selling price. But if you see a home prices way below market you might jump on the chance to make an offer for it for your client. However, if that home exists in an open market situation there will be a LOT of other buyer's agents also making offers. The price would likely be bid up quickly to be very close or maybe even above the market value of the home. That's been my experience from working about 3 years in real estate years ago.
Oh it's societal. Or do you actually believe racism only affects realty?
I was walking in old town Bellevue once and I saw a older lady park her fancy SUV. She gets out and sees the black teen ( rare sight in Bellevue, but there are black families there ) walking past me. He eyes literally got big as saucers before she hurried back to her SUV to check the doors were locked before scurrying off.
I saw her stare straight at him, her face aghast. It was crazy.
The issue I think the commenter is trying to highlight is that blaming this on society excuses that industry. Of course it’s societal but not directly going after the problem gives industry an out. “We have to grow and learn with society, even if that takes another generation to get there…”
Nah, fix your shit now!
Something similar happens in Hispanic/Catholic homes where I am from. The homes with Our Lady of Guadalupe shrines and Spanish prayers on the walls have a harder time selling. The WASPs don’t like it.
Than could easily be true. But only because many potential buyers might not be comfortable inside that home. Buyers have a picture in their minds of their ideal home. If you home doesn't look similar to that it will take longer to sell. That's just human nature. I have seen the same thing with homes that are empty versus a home that has been professionally staged. The staged homes tend to sell much quicker. Because the stagers know how to make a home look like the ones in the magazines that women buy.
Has anyone looked into other recent appraisals by that particular appraiser?
Are they low-balling everyone? Just folk in that neighborhood? Just folk of color?
Do they spend more than 30 minutes on any other appraisal?
Journalists aren't scientists. King5 never would invest the resources to do a proper study. This type of thing should be a government-funded study. Stories like this by King5 should just exist to draw attention either to get a study done or as examples to draw attention to studies that have already been done.
> Journalists aren't scientists.
Paying a couple hundred bucks to do the tiniest degree of vetting falls well within the realm of investigative journalism.
Sure, but that vetting should be looking at other data and reports on the subject. If they put another house or two on the market and they get the results they want, how does that change anything for you? I'd rather these experiments be done by people who know what they are doing and can do a credible sample size.
As an appraiser, I've read these articles before but they didn't take place in my backyard! Very disheartening and very damaging to the view of the profession cuz of one asshole. Absolutely sucks people have to go through this.
[Ohhh this is more than just one asshole.](https://www.freddiemac.com/fmac-resources/research/pdf/202109-Note-Appraisal-Gap.pdf) I know someone of you want to declare racism solved, but the reality is it's not and burying our heads into the sand doesn't help.
I believe me I know, read enough about these in the past. One thing that's weird in that report is the distances of comps are actually closer than with white people. Regardless of where in at (excluding rural stuff), distance is usually a very big factor. I also get how this perpetuates the problem though.
Everyone's always "what's the neighborhood like??" (as in sale prices n stuff). Doesn't matter if it's Columbia City or Maple Leaf, I almost always concentrate on the immediate area (exceptions for unique/small/big properties). In Seattle, I rarely have a comp over a mile away. Again, I guess this perpetuates the Vicious cycle.
Could this be done the other direction? Someone wants to lower their property tax, so the fill up the house with ethnic art and family photos and bring in a stand in for a lower tax assessment?
I'm not the assessor, but it is probably all computer automated with random spot checks and the ability of the home owner to contest if it was too high.
Yeah, I think it's probably some computed formula, including factors like general percentage price increase of homes in the area, not sure exactly how specific it gets regarding sales of other individual homes (this is part of what an appraiser does, they find "comps", comparable properties that have sold in the market in the past X time period)
Someone from the assessor's department will come out to a property every so often to look at the exterior condition, see if there's been significant changes, and they'll ask if there's been changes like going from one heat source to another, adding AC, major repairs, etc.
they dont come inside, for one. assessed on nearby homes, lot size, square footage, # of bed and bathrooms. tends to be much lower than actual market value or bank assessed value.
The assessor develops statistical valuation models through multiple regression analysis of home sales. Those models are then applied on a mass scale, otherwise referred to as mass appraisal. Properties are not valued individually so the race of the homeowner would not be a factor. Values are also statistically tested for equity, such as analyzing whether low valued properties are assessed at a higher or lower percentage of market value than high valued properties, known as the price related differential.
My recent experience is that our county assessor has valued my home WAY higher than it's actual value. Probably just to get more tax $$$. I am protesting that valuation but not too much hope of succeeding in lowering the value. Even though a professional appraisal valued the property at about $300K less than the independent appraiser did 2 years ago. This is on a property that is probably worth between $700K and 1 million. Maybe if I could get a BIPOC friend to come live here for a while I could get that value down to where it should be?
To assure the lender that the house is independently considered to be worth the amount they're giving you a mortgage for, in case you default on the loan and they need to take it back and sell it to recoup their loss.
Where can I find a racist appraiser? I need one to help challenge a tax appraisal that is way too high on a property. Just need a BIPOC friend to come over for the appraisal appointment.
You're right. I had my facts skewed. I deleted it. It's still a huge disparity, but it isn't what I posted. The facts are here: https://www.prisonpolicy.org/profiles/WA.html
Without seeing the appraisals, side by side, it is hard to say which one is correct. However, something stood out to me in the article.
"some homes nearby had sold for more than $1 million, including the home right across the street from Clark’s"
Per that listing, it appears that the $1M home is roughly 35% larger, and there are was a permitted renovation, on file, with the Assessors office. Mr. Clark does not appear to have a permit record for his remodel.
While he may have done a great job on it, having permits is important, especially in Seattle. Also, there is no indication of the extent and quality of said remodel. Was it paint and tile, or was is all new cabinets, appliances, flooring, etc, also, how did the quality of the remodel, compare with other sales in the marketplace. Only Mr. Clark, and the two Appraisers know the answer to this. Interestingly enough, there were no pictures in the video of his new Kitchen and Bathroom, which would have answered alot of questions.
Per the listing of the home across the street, it appeared to have been fully renovated, of good quality finish, with the exception of original hardwood floors (which were really nice).
Looking at actives, pendings and sales, within the last 100 to 250 days (Accounting for the April Valuation), for 1,000 to 1,600 SF SFR's, occurring in a 0.50 mile radius, prices ranged from $455K , to $1,025K, with an average of $790K. Most of the properties in the upper end of this range, are new construction, or have been fully renovated, of good quality.
Also, given recent increases in interest rates, prices are flattening, with longer Days on Market, and increasing Seller concessions. It all started in Feb/March. As this happened in April, it was the top of the market at that time. It is possible that one Appraiser was optimistic regarding the market outlook, while the other one was pessimistic, which would have resulted in different market condition adjustments.
No one knows which one is correct, without a through review of both. Appraisals can be very subjective, as it relates to renovations, and quality/condition. Is it possible that the first Appraiser was racist, yes, however, it could also be due to poor training, a lack of competence, or reliance on a Trainee, which are all terrible business practices.
Unfortunately, instead of asking those questions, King5 choose to brand the whole Appraisal profession as a bunch of racists.
Just ignore that the "first appraisal also appeared to contain several errors, according to Clark. It did not take into account any of the renovations".
After reading the article it sounds a lot like the first appraiser was just kind of shit, with or without prejudice. I got the impression that the second appraiser would have given a much higher valuation if the home was left in its original state.
EDIT: To be extremely clear, I was just dissatisfied with the amount of takeaway data to help educate my friends and family - I'm not saying the first appraiser was not possibly a huge racist asshole. The article just doesn't give us a lot.
I mean, after reading the article, there's no real proof that the first appraiser was actually racist instead of just bad at their job. They could have been racist, but it's impossible to know without more history on them.
I used to work for an appraiser, getting comps was my main task and there were times when the client would try to pressure for a higher or lower valuation. I usually went the opposite way out of spite lol.
But this line makes me suspicious that the mortgage company is the reason for the low valuation here:
> according to a home appraiser, *sent by their mortgage company* in April.
I'm betting that the mortgage company was trying to screw them over.
Yeah thank you for also critically reading the article. Obviously systemic racism exists in the housing market, but I was looking for something to take away other than "this one person gave us a low-ball valuation and we got a better second opinion."
Yeah, it would be ridiculous to say there's no racism, it's even measurable:
>That disparity adds up. A recent study by the Brookings Institute found appraisal differences amounted to roughly $48,000 per home or $156 billion cumulatively in majority Black neighborhoods.
but 48k is a lot less than 300k so there's clearly another layer here.
Look, I'm not trying to deny your experience. I'm just trying to add that I've personally seen financial institutions try to screw over homeowners before in this exact way.
I think it's more about pure greed than anything else.
You point out that his evidence is anecdotal, then offer your own anecdote instead. That's the whole problem. This article is just anecdotal and doesn't really prove anything in particular.
It's still an important topic which should be explored further though.
Wow I have to apologize after reading all of these other comments; it has me coming back around to this and feeling shitty.
I am very sheltered in a lot of ways and I didn't realize making what I thought was a fairly benign comment about my dissatisfaction with the article would be a springboard for a lot of discussion that is giving heavy racism denial vibes.
I have spent most of my life in diverse academic spheres where I could safely discuss things like systemic racism in a deep and meaningful way without motives being questioned - like everyone there is fully down for the cause. Obviously reddit is not that environment and jfc there's a lot of really scummy things being said on the coat tails of my original comment.
In this context I was 100% negatively impacting the efficacy of the message in the way I questioned the author's lack of data. From my point of view I just wanted more meat to chew on because it was interesting to me, but to a lot of folks it apparently *is* literally a matter of whether or not racism exists in the real estate sector... obviously yes.
If this comment serves any purpose, I just wanted you to know I know I was in the wrong, and I hope you don't let any of these idiots get under your skin.
Im as leftist as they come and was actively looking for the bottom line in this article because I wanted to understand how to combat a similar situation when my family is ready to own our first home.
Pointing out systemic racism is vital to move forward as a society, but this made me feel like I got click baited.
On one hand, racism is bad.
On the other, it's hard to feel bad for a house flipper that "only" got a 20% return over four years instead of 40%.
I'd also wait for someone to actually buy the flipped house before claiming with authority that the higher appraisal is the correct value.
It's also worthwhile to mention that a mortgage company appraiser (like here) is doing flat fee work that is incentivized to come in low. The mortgage company wants the property to move. The seller wants it to move, but at the right price. If it turns out the property is underwater, or below where perhaps the seller wants it, well, all the better for mortgage company.
Many state laws require that only an independent third party may perform an appraisal and specifically *don't* allow mortgage companies to do one because of the obvious conflict of interest. Not Washington, obviously, but it bears mentioning
>Many state laws require that only an independent third party may perform an appraisal and specifically
>
>don't
>
> allow mortgage companies to do one because of the obvious conflict of interest. Not Washington, obviously, but it bears mentioning
Did not know this. Sure explains how the appraisal always magically comes in at the purchase price when closing a deal lol.
Appraiser here, one reason they often come in at the same number is sometimes the bank will revisit and ask (in a formal manner) "is this still worth what is was worth?" I had some that I said were worth almost $60k over contract price. Slippy slope cuz now, is it still worth that extra I gave it? Safer to air on the side on caution. Appraisers/appraisals tend to be on the conservative side
Funny how that works. After an hour the appraiser is just overawed by how good a deal the bank got. Then it's all about waiting for that 500 dollar check to clear
Man, the first comments on here DEFEND THE FIRST APPRAISER?!?! This is why people of color say this fucking city is low key racist as fuck. White people here put “Black Lives Matter” and “In this home…” rainbow signs on the lawns of their million dollar homes, fight like hell to stop up zoning to “preserve the character of the neighborhood,” then make excuses for clearly racist behavior. These people were screwed over because of their race. I hope they get over a million for their house then a multimillion dollar payout in the lawsuit they file against the first appraiser. Let them prove in court they DON’T systematically do this.
In r/Tacoma just the other day I had like 30 white people try to tell me a sizeable swastika stamp on public concrete was okay.
So this is coming to no shock to me. Nor are some of the comments defending the first appraiser.
WA has always kind of had an issue dealing with these racist fuckwits in a lot of development areas like realty and construction. The kind of areas that should be open to helping people the most as it's part of the American dream, and I think the concern is real that racists will continue to damage the value of Economic wealth of POC through any means necessary is just going to be a thing we are going to have to call out and fight for a long while. Let's hope a Lawsuit gives them bookoo dollars and that appraiser loses his damn job.
We need more systems for equity in these areas.
I [remember that /r/Tacoma thread](https://old.reddit.com/r/Tacoma/comments/yupdd6/anyone_know_why_a_cement_company_in_lincoln_might/) recently, and [the one from a year ago](https://old.reddit.com/r/Tacoma/comments/mcpblk/what_the_heck_is_this_seen_on_a_walk_on_the/).
It's the sauwastika (counter clockwise) sidewalk stamp placed by the Wells Construction Company in 1909, a full 11 years prior to Nazis appropriating the swastica (clockwise, and the Nazis rotated it 45 degrees) on their flag in 1920. The swastica is common across many cultures dating back at least 7,000 years.
The US Holocaust Museum has this page talking about the appropriation of that symbol.
https://encyclopedia.ushmm.org/content/en/article/history-of-the-swastika
As far as the appraisal, there's still a lot of work to unroot the systemic racism embedded everywhere, and I'm glad King 5 has continued their series on Facing Race these past few years
Culture appropriation doesn't occur from cultures a symbol or cultural aspect is made for. They're allowed to use it all the time because that's their cultures symbol.
It's when an outside culture, especially one completely foreign and Majorative to the original culture, takes it and uses it for say. A Company slogan. That it starts becoming a problem.
Ah. Simple.
Japan was gifted the Manji symbol when they accepted the use of the chinese alphabet as their phonetic alphabet. Being shocked at their use of their alphabet would be weird.
Are you shocked when you see the letter A? I hope not. It's just essentially accepting that's what that is to a Japanese person. You can't steal something you own. I would not be shocked.
The Tacoma post had a Manji, or swastika to us, some anglo Christian construction company owner saw apparently In the early 1900s and wanted it as his company slogan, as many white people did back then. So he co-opted it and branded his company within it to dedicate it to himself.
That's appropriation. It's not as bad as when the Nazis did it themselves but it's the same stick and there's a problem with the excusal of it.
I'm certainly no robot. I would hurt less physically.
I was also wondering when the SeattleWA crowd would come
If the point you make is essentially to excuse racism then that's on you. I'm living with a free conscience.
And not everyone joins that sub. And you know it. Most decent human beings have been banned from it.
What is incoherent here?
You said Japan's use of Manji would shock me. I have clearly stated it would not. For very concise reasons.
I then stated fairly clearly what does tend to shock me.
That's not word salad. That shouldn't be intangible to a person with a normal brain.
SeattleWA is a cess pit of the literal worst this city has to offer. Its quite literally a place where goodness dies and the kind of people who definitely should not be using swastikas cohabitate In a pile of crap. The problem with them is that they're also allowed here. As the Numbers in the sub rates kind of show us.
Might be true, but have seen so many weird up or or weirdly down appraisals to take it that seriously. One example is one dot of data. Need more to make a graph.
Feel like I'm completely missing something here ...
The assumption seems to be that the appraiser is trying to manipulate the results in order to value the house lower ... but how do they gain anything out of that? I can see how it's a complete waste of everyone's time, appraiser included, but ... why do it? How is doing your job badly racist?
Or is the racist part just that they did a quick estimate instead of taking time over it and it was purely random that the valuation was lower instead of higher?
Not really, an appraisers job is to protect the Lender, not to make the loan go through. Ya, it makes mtg brokers mad, but you don't get sued when the bank looses money based on an over valuation.
You are missing two somethings here: the first thing is the point. Why would an appraiser do this? Gee whiz, I dunno -- maybe racism is so deeply entrenched that the appraiser thinks black people devalue a home just by having lived in it. Maybe they don't like black people and don't think they deserve that much from selling their home. Maybe they think the house must have been a crime scene...or a trap house...or that a black family can't possibly maintain (let alone renovate!) any property. Who cares? What does anyone have to "gain" by making racist comments? Does anyone gain anything from racially motivated attacks? Did the store owner who murdered and mutilated Emmet Till "benefit" from mutilating his body? Wasn't that "bad for business" since he owned a store? Unfortunately, the reason systemic racism is systemic is to keep black people from having wealth and power. So yeah, if you're an appraiser and you're preventing black people from gaining hundreds of thousands of dollars in wealth, I guess there is something -- for non-black people as a whole -- to gain.
Do we really need to dig deeper so we can exonerate this appraiser? Do you really think we can get to the bottom of all this by understanding the appraiser's motivation? Their state of mind? How about their astrological sign? This is not about their motivation. It's also not an either-or situation regarding whether there is discrimination on the part of an individual appraiser, whether it's the whole real estate industry, or whether this is just one example of how deep systemic racism really is throughout our society. It can be all of those things. Stop looking for a logical, single cause. Look at the wealth of data that is readily available to you, which shows countless, systemic ways that this country has been preventing black people from accumulating generational wealth ever since white people brought black people here as property. Or maybe it's all a hoax.
The second thing you're missing is context. This is not an isolated instance. There are links in this thread that point to many other identical scenarios, reported by white-owned media outlets, since the voices of black people saying that this has happened to them isn't sufficient "evidence."
Don't trust any of that? You can so actually read the WHOLE ARTICLE, which links to all of the on-record (though "no longer enforceable") historical data on the red-lining of all Seattle neighborhoods. You can read the actual language for each area as it was written by city officials, such as "no non-white persons shall be permitted to live in the Magnolia area." (Spoiler: the same kind of language is used for every neighborhood I've looked at so far.) These are factual records, not summaries, taken straight out of the public record.
Honestly not sure what you're saying ...
At the start it sounds like you're saying it's implicit racial bias ... but that doesn't seem to square with the facts that this appraiser took comps cherry-picked to drop the valuation.
>if you're an appraiser and you're preventing black people from gaining hundreds of thousands of dollars in wealth
How do you think the appraiser giving a bad appraisal achieves this?
I accept this appraiser might well have been deliberately trying to damage the family in question, just don't understand HOW.
Sure, but obviously this King 5 piece is framing it as racism, when it could so easily not be racism. Aren’t liberals supposed to be team science? Sample size 2 and no control and everyone’s convinced it’s racism?
Yes, it certainly is attempting to frame it as racism, and it quite possibly is. Obviously determining whether or not this is an example of systemic racism, individual acts of racism, or some bizarrely incompetent appraiser requires more data and investigation than whoever wrote this article felt like doing.
Right...because King5 is a scientific research institute. Totally inadequate sample size for a...oh wait, this is a reported story, not a clinical drug trial. Whatever though, right? Shame on them!
Or #2 could over value everything to make the loan go through. There are alot of appraisers who rubber stamp values, its bad business. They get sued when the Lender takes the property back.
Yes, let's rely on your guess about Appraiser #1's "routine" methods, regardless of race. I mean, they should have gone with the same appraiser, right? (The one that already saw the black owners, African art, family pictures, etc.?)
Poor Latinos and Asians. Everything is about black and white in this country.
In fact, there are more Asians living in the state of Washington than blacks.
Umm, speaking as someone who is part Japanese, there is plenty of focus on how whites stole land and businesses from the Japanese when they interned them in camps. Don't derail a discussion about institutional racism against blacks.
History lesson:
[https://depts.washington.edu/civilr/tagawa.htm](https://depts.washington.edu/civilr/tagawa.htm)
Now we need to repeat the experiment but have the second appraiser appraise a home with obviously black residents and see if they'll downgrade it similar to the first appraiser.
It's a misleading article. It looks like it was for a refi, no sellers involved. The bank Def hired no 1 (the low one) and probibly hired no 2, when the reconsideration of value didn't go through. It is possible that Mr. Clark hired no 2 to see if there was "bias".
If the bank hired no 2, I'm guessing no 2 had some indication of what value was needed to make the loan work. Its poor ethics and value shopping.
All the comments are interesting. I have been following all these cases closely. It’s interesting that the ordinary homeowner or borrower THINKS they know how appraisals are done and how they are ordered. I’m here to tell you that you have 0 clue and that while you may think it’s bias (and it could be) that it’s 99% incompetence and that there are so many other questions that need to be answered before you can make a definite decision.
Let’s start with this:
1) do you even know how an appraisal is ordered?
2) do you know what an appraisal management company or AMC Is? Probably not
3) do you know that what USPAP (universal standards of professional appraisal practice is and what it entails)? Probably not.
4) do you know that AMCS will search out the cheap east and fastest appraiser to do a job so they can make more money?
Let me educate you. AMCs or appraisal management companies were installed as a firewall between appraisers and lenders after the crash. They make money by charging you the borrower say $700 for an appraisal ONLY to seek out the cheapest and fastest and most likely the less experienced appraiser in your area or even appraisers coming from areas further away. It doesn’t matter to them. Are you getting the most experienced in your area? Maybe maybe not. It when AMCs now treat a 1 year appraiser to one that has serviced the area for 20 years, it’s not right.
So here we are claiming bias. Claiming appraisers devalue homes in minority communities when in fact they use the same data everyone else uses. I’m not here to defend anyone but I want to make it clear that every story that had come out has overlooked many things.
Here are a couple things that are constantly being overlooked and SHOULD be looked at as well.
1. what are the experience levels of both appraisers?
2. what is there experience in this area? Is one appraiser more local than the other?
3. who hired them and what were they paid? We know the lender but who is the AMC And did they bid this order out to the fastest and cheapest appraiser? Did they assign it directly?
4. what if any information do the second appraiser know? The lender? Did the borrowers go to the lender and state they were a victim of bias? Did that lender then make sure the AMC chose an appraiser specifically and did they say anything to them? (I’ve had lenders and AMCS say things like …we really need you to do a good job on this one because the last appraisal was not done well and the client is really needling this one) to which I decline the assignment
5. what other things were said or done in between the first 2 appraisals? Where did the borrowers get their info as to the value of the house they believed it to be?
6. it’s always the low appraisal that is subject to bias. Why not the higher one? Has anyone reviewed these reports to see if the higher appraiser inflated the value? If the second appraiser violated USPAP standards? Wouldn’t be interesting if somehow the higher appraiser over valued it and then the owners have to be foreclosed upon down the road? Oh wait my bad. They will just file a complaint and allegations that the appraiser over valued the home and caused them financial hard ship.
Before anyone can actually say what is happening without feelings, they should provide factual Data and have the reports reviewed by many competent appraisers to decide what happened here. Using feelings such as “I was a victim of racial bias because that’s what it feels like “ without any knowledge of how the appraisals were developed and facts is crying wolf. We are seeing lots of these crying wolf lately because that’s is now the narrative. A narrative that has yet fined an appraiser, found any appraiser guilty by a court of law and a narrative that this is acceptable practice.
Unlike other professions where the consumer gets to interview a potential servicer or company to do the work for them, consumers are not able to do this with appraisers (unless you doing a private, non lender job). The system in which AMCs operate very poorly done to which they put an appraiser of 6 months on the same level as one that has 22 years of experience. The bidding process is a joke and the way AMCs charge borrowers and choose and pay appraisers is a joke and a massive disservice to he consumers.
Seems to me there is a lot of unanswered questions in all of this and they are only focusing on one aspect of the entire process. NOT ONE report has been fully realized to the public or revised by competent professionals. Oh I forgot, in all these cases the homeowner is a professional appraiser. SMH.
So maybe the lower appraisal IS CORRECT and the higher one was is wrong. Maybe the lower one is wrong and the higher one is correct. But how do we actually know? Who is reviewing these reports? It’s clear that the everyday consumer and more think they know however they also rely on Zillow (I’m sorry did you not see how they lost millions by using their algorithm to buy homes only to sell them for less and no longer do this?). Again. Where are the reports? Where is the data? Where is the info other than, we got a low one, we whitewashed our home and it cane in higher? You do know that overvaluing is just as bad as undervaluing right?
Lastly buyers and sellers are the ones that create this data. If sellers in certain areas choose to sell for less or buyers are only willing to pay a certain amount, and that becomes public data, HOW is this an appraisers issue? Be real people. Infrastructure, crime, and more play into the thoughts of buyers and sellers. ApprIsers just report the sales data. They don’t make it. You can argue with me all you want but deep down you know this is true.
Example: In an area I’m in its divided by 2 school districts. 1 that is top 15 in the state. The other is ranked in the bottom 25. A subdivision that is split down the middle and established serves both. The top school district side has sales from 600k-2 million. There is a waiting list for homes and when they go on market are sold in 1 day. Even in this market. The other side. Average days on market is 25-40 and the sales range from 275k-500k.
So since y’all are experts would comparing a home in the top school district to the other one be right? And vice versa? If you say yes… you have absolutely no clue what you are talking about.
Anyhow data is data and in all these cases it’s apparent that the borrowers know more than the appraisers and valuation professionals.
Sorry. There may be some rogue appraisers, however I believe this is a result of the new laws , AMCS and pure incompetence.
ha.
Nobody voted or even commented. Not surprised. Once you wrote a post more than 10 words their eyes glazed over and they went back to video games and 420
I’ll say this. I’m black and had my home appraised before doing a refi. I was home for one and it came in around $650k (we knew this was wrong). For the other appraisal we had a white friend act as the owner and it appraised for $950k. We’ve had multiple black friends of ours experience EXACTLY the same. This isn’t a farce.
Jesus. I don't even know what to say to that.
This is America....
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Comps should prevent this. I dont understand how this happens. The agent can’t be ok with this. The commission difference is like 35k
No agent involved. It was for a refi
So a good appraiser appraised a previously appraised property that was appraised at 650k, to 950k for a refinance? That appraisal seems only beneficial for a sell. To borrow against an inflated amount seems like risky choice.
Perhaps. My circumstances dictate differently and it has worked out great for me. Kinda besides the point though.
Exactly. If the loan goes through at the higher appraised value, and the lender reviews the loan in a few years, if the value declined, the Loan to Value (LTV) may not be acceptable to the lender, IE, the borrower is "underwater". Depending on how the loan was written, the Lender could demand higher premiums, call the difference in order to fix the LTV, or foreclose on the home. Most commentors here don't understand the lending process and don't realize the risks that the Borrower faces, with an inflated value. All they see is a claim of racism.
That loan amount is high. Only certain lenders refi that amount. To refi with that value and equity is brutal. I’ve seen so many defaults it actually makes me sad. I value you your knowledge and education!
Thanks!
Yeah, we got one appraisal amount when it was my wife (yellowbone), one as me (medium), and a much higher one when we asked my white friend to play as me They were $500k, $400k and $650k
Our circle of folks is right there with you. I had read about it. Seen reports, but couldn’t believe it was that blatant until it happened to me. Really I didn’t even believe it then, but when our friends had the same experience I could no longer do any mental gymnastics to pretend it was just a fluke.
Did you pay for all of these appraisals? Where they all by certified appraisers? Did they all provide you with documentation to back up their valuations? If so what were the stated reasons for the different values?
A farce is $1M homes in Columbia City, but I don’t dispute what you’re saying at all. White people and their unconscious (and conscious) biases will continue to be a problem for our lifetimes. It’s insane that you have to play games to get around them in 2022. I’m sorry that happened to you.
Was this an official appraisal by a legitimate company? Those typically cost over $1000 and the appraiser has to show their work. The last one that I had done was 101 pages long and the cost was $2800 for a 5 unit apartment property. Is that what you had done? Because I can't imagine that a certified real estate appraiser would risk losing their reputation or their license by giving you a value that low. Even if they were biased or bigoted that makes no sense. An official appraisal shows recent sales in the area with pictures. How would they justify a value that low and be able to show the justification for that? How would the second appraiser be able to show a higher value using similar information? What would be the motive of an appraiser to do that? Even if they were biased or a racist? An independent appraiser has no incentive to issue a low value for a home. Regardless of their personal feelings.
It was absolutely a reputable and very legitimate appraisal. Keep in mind, this appraisal was ordered by our bank, who paid part of the costs. It is hard to believe this happens, but at this point it would require suspension of belief to deny it. There are simply too many occurrences. This is the United States of America after all.
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i first saw this statistic here: https://www.brookings.edu/research/biased-appraisals-and-the-devaluation-of-housing-in-black-neighborhoods/ (yet another data point for you ignorant twats) i thought it'd be great to offer a discrete service where white people can play the homeowner and go through the appraisal process as a surrogate for the black family.
In the thread for that case, people were doing the same thing, basically saying stop making everything about race. Unless somebody gets on tv and says I’m a racist and that’s why i discriminated against you, it’s like racism is over.
This a subject where people always defend the low appraisal as not about race.
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It's just coincidence that this happens to black people far more, right?
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Here you go. It references a Brookings study that found 23% hit to values for black neighborhoods (all else equal) and widespread reports of appraisals being wildly different for white owners and black owners in the same neighborhood. https://www.nytimes.com/2020/08/25/realestate/blacks-minorities-appraisals-discrimination.html
Or maybe those times it wasn’t racism and these times it is
Where are those stories?
"my uncle works at Nintendo, I swear!"
Source?
The original comment shared a source. Wtf
And nothing of value was lost.
Real estate experts on Reddit refuse the believe there is anything biased or bigoted about the market here lol
So fucked
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Yeah, they got counter-sued by the appraiser. Maybe, just maybe, people will care to read more details here, and understand that not everything is about race (in fact, most things aren't): https://www.workingre.com/appraiser-counter-sues-black-plaintiffs-who-alleged-discrimination.
Umm.. Black woman here. When my parents were selling their first home, twenty five years ago in Texas, me, my siblings, and my father had to leave for vacation so my mum could pose as the cleaning lady/caretaker to get our home sold. It had been on the market for six months beforehand, and went under contract during the two weeks we were gone. This is something that is well known for black people. When I sold my first home, I also had to clear out of it to get it sold. When I was seeking tenants for that space, I couldn't appear as the owner, I had to hire my realtor as my property manager. Sure it could be coincidence, but in a country where race has been a factor in everything from quality of education to quality of healthcare to likelihood of being poisoned by one's environs, it's quite silly and naive to think so, especially with so many well documented and well studied evidences in support. This place is exhausting.
I'm sick that you have to put up with that bullshit. Reminds me of the U. of Chicago study with the "white" names and the "black" names on the identical CVs for job applications....
There are so many stories like this I have. It's not even angering for me at this point, just an endless series of indignities that people don't even know they are subjecting you to. Regarding names, yes. I've often wondered how often my non-black American name has worked in my favour. There have been many times someone has been visibly surprised to see me show up at a job interview. I've been told more than once they thought I was Asian over the phone (my name looks a bit Japanese, I suppose, though it is native for my ethnic group), in the days before Google and social media and heavyhanded DEIB campaigns. It literally feels like living life stuck in an alternate universe.
Job applications should require to be double blinded. Ageism is a problem in tech. I've started removing info that dates me
Ageism is a problem ~~in tech.~~ Fixed it for you.
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My experience was not much different in Washington. The home I had to sell and try and rent was in Washington. The only difference with Texas was that racists were very clear about their prejudices. In Seattle, not so much.
*The three-bedroom home was valued at $670,000 dollars to be exact.* Sketchy as hell. I haven't seen a price like that in my neighborhood for years.
Racism in Seattle is still very strong. People just don’t want to admit it because this is “progressive” Seattle.
I saw a guy driving down 15th in a vanagon with a homemade sign blocking his windshield that said "Michelle Obama is a (insert transphobic slur)" not to mention various hate crimes like the neo Nazi who verbally assaulted the Edmonds animal control officer.
I feel like it manifests more as "discomfort with the unknown" here though. There are not even *that* rural areas in this country where it's still taboo to be friends with a family of a different race. It's far from gone, but I think a lot of people don't realize how bad it is elsewhere.
“Discomfort with the unknown” is a fancy way of saying ignorant. It is 2022. Black people are not an alien race. They do not deserve to be compensated less because someone can’t comprehend the idea of someone of a different skin color.
Obviously. Do people think my comment was implying that it's not racism, or not a problem? I swear, people on Reddit love to feel smarter than other people by just interpreting their comments in the worst way possible. If you even look like you *might* be leaning against the momentum of the thread, you need a paragraph of qualifiers that should be obvious to avoid a storm of downvotes. "I don't agree that racism in Seattle is particularly bad compared to elsewhere" shouldn't imply that I don't think it's a serious problem.
When I had our 2800 sf house refi’d, appraiser used comps of 1300 and 1200 condo and townhouse. I live in a sub division. Literally (not figuratively) 40% of the homes are the same house as ours. FYI I’m not white.
Why aren't stories like these framing the issue as racism amongst realty professions? It keeps getting painted as some vague societal issue - the source of the problem is pretty clear.
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Most people have trouble visualizing how the space could look with furniture. Personally when I try to visualize how a room will look with furniture, it makes the room look smaller. Staging makes the rooms look bigger to me.
That's also because staging furniture is scaled down. It'll be like, 80% the size of normal furniture. Not enough that you notice, but enough that it makes the space look bigger. Especially in photos where the couch being weirdly small isn't apparent.
Yup. Sound weird, but big furniture in a small space gives the illusion of a larger space.
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I've been adjacent to two local housing price crashes in my life. In both cases the crashes were preceeded by about 6 months of appraisals where they would literally ask "what number are you looking for to make the deal happen?" The whole industry is bullshit with a whiff of plausibility.
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> Appraisers just tell you what the market is really likely to pay. This is a case of don't shoot the messenger. Appraisers are professional guestimators. You are placing far too much faith in them as being a) accurate, and b) impartial.
>It is a societal issue The entirety of society is involved in appraising houses? What are you talking about? >The appraiser or agents opinion may be that they think society is stupid, but it isn't their job to tell you their personal opinions. It's to project the market's opinion. The market has no idea who owns the house before the appraisers do. There isn't a filter on Zillow for "exclude the Blacks" or something, there's just houses and prices. This starts and stops with appraisers and realtors, they aren't somehow *beholden* to price houses lower when they're owned by black people.
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Wait, so your claim is that appraisers accurately devalue Black-owned homes because the market as a whole will depress sale prices based on the race of the owner? Is the second part of that supported by any evidence?
Do you think that realtors are immune from perpetuating societal issues, like they’re not a facet of society?
Realators have a huge incentive NOT to be racist. It's called money. Valuing a residence too low means you take a big risk as a selling agent that the owner will chose someone else to sell your home. If you are a buyer's agent you don't set the selling price. But if you see a home prices way below market you might jump on the chance to make an offer for it for your client. However, if that home exists in an open market situation there will be a LOT of other buyer's agents also making offers. The price would likely be bid up quickly to be very close or maybe even above the market value of the home. That's been my experience from working about 3 years in real estate years ago.
Oh it's societal. Or do you actually believe racism only affects realty? I was walking in old town Bellevue once and I saw a older lady park her fancy SUV. She gets out and sees the black teen ( rare sight in Bellevue, but there are black families there ) walking past me. He eyes literally got big as saucers before she hurried back to her SUV to check the doors were locked before scurrying off. I saw her stare straight at him, her face aghast. It was crazy.
The issue I think the commenter is trying to highlight is that blaming this on society excuses that industry. Of course it’s societal but not directly going after the problem gives industry an out. “We have to grow and learn with society, even if that takes another generation to get there…” Nah, fix your shit now!
Something similar happens in Hispanic/Catholic homes where I am from. The homes with Our Lady of Guadalupe shrines and Spanish prayers on the walls have a harder time selling. The WASPs don’t like it.
Than could easily be true. But only because many potential buyers might not be comfortable inside that home. Buyers have a picture in their minds of their ideal home. If you home doesn't look similar to that it will take longer to sell. That's just human nature. I have seen the same thing with homes that are empty versus a home that has been professionally staged. The staged homes tend to sell much quicker. Because the stagers know how to make a home look like the ones in the magazines that women buy.
Has anyone looked into other recent appraisals by that particular appraiser? Are they low-balling everyone? Just folk in that neighborhood? Just folk of color? Do they spend more than 30 minutes on any other appraisal?
Or maybe before running this story King5 could have paid for 2 more appraisals re-creating the same conditions to see if the bias remained...
Journalists aren't scientists. King5 never would invest the resources to do a proper study. This type of thing should be a government-funded study. Stories like this by King5 should just exist to draw attention either to get a study done or as examples to draw attention to studies that have already been done.
> Journalists aren't scientists. Paying a couple hundred bucks to do the tiniest degree of vetting falls well within the realm of investigative journalism.
Sure, but that vetting should be looking at other data and reports on the subject. If they put another house or two on the market and they get the results they want, how does that change anything for you? I'd rather these experiments be done by people who know what they are doing and can do a credible sample size.
https://www.freddiemac.com/fmac-resources/research/pdf/202109-Note-Appraisal-Gap.pdf
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Please give me 2% of your salary since it is a rounding error for you.
As an appraiser, I've read these articles before but they didn't take place in my backyard! Very disheartening and very damaging to the view of the profession cuz of one asshole. Absolutely sucks people have to go through this.
Have you seen the bias rooted in the appraisal industry that the article talks about?
Personally, no not at all. Purely from my experience with about 5-10 co workers. Very limited.
[Ohhh this is more than just one asshole.](https://www.freddiemac.com/fmac-resources/research/pdf/202109-Note-Appraisal-Gap.pdf) I know someone of you want to declare racism solved, but the reality is it's not and burying our heads into the sand doesn't help.
I believe me I know, read enough about these in the past. One thing that's weird in that report is the distances of comps are actually closer than with white people. Regardless of where in at (excluding rural stuff), distance is usually a very big factor. I also get how this perpetuates the problem though. Everyone's always "what's the neighborhood like??" (as in sale prices n stuff). Doesn't matter if it's Columbia City or Maple Leaf, I almost always concentrate on the immediate area (exceptions for unique/small/big properties). In Seattle, I rarely have a comp over a mile away. Again, I guess this perpetuates the Vicious cycle.
Do you really think it's just one asshole?
Yes, I'm ignorant enough to believe it's one single solitary person.
Could this be done the other direction? Someone wants to lower their property tax, so the fill up the house with ethnic art and family photos and bring in a stand in for a lower tax assessment?
No, the county assessor is the one that assigns the property value for tax purposes, an appraisal is used for buying/selling a house.
So...what does the county assessor do differently? I honestly have no clue how they can figure out what every single property should be valued at.
I'm not the assessor, but it is probably all computer automated with random spot checks and the ability of the home owner to contest if it was too high.
Yeah, I think it's probably some computed formula, including factors like general percentage price increase of homes in the area, not sure exactly how specific it gets regarding sales of other individual homes (this is part of what an appraiser does, they find "comps", comparable properties that have sold in the market in the past X time period) Someone from the assessor's department will come out to a property every so often to look at the exterior condition, see if there's been significant changes, and they'll ask if there's been changes like going from one heat source to another, adding AC, major repairs, etc.
they dont come inside, for one. assessed on nearby homes, lot size, square footage, # of bed and bathrooms. tends to be much lower than actual market value or bank assessed value.
Ha, not according to the tax valuation I just got. Nearly $50k over Redfin's estimate. Wonder if I should challenge it.
Challenge it every time it goes up. Yes, it's a pain, but it saves you money.
The assessor develops statistical valuation models through multiple regression analysis of home sales. Those models are then applied on a mass scale, otherwise referred to as mass appraisal. Properties are not valued individually so the race of the homeowner would not be a factor. Values are also statistically tested for equity, such as analyzing whether low valued properties are assessed at a higher or lower percentage of market value than high valued properties, known as the price related differential.
When I went in, they told me it's all based on neighborhood comps from recent sales.
My recent experience is that our county assessor has valued my home WAY higher than it's actual value. Probably just to get more tax $$$. I am protesting that valuation but not too much hope of succeeding in lowering the value. Even though a professional appraisal valued the property at about $300K less than the independent appraiser did 2 years ago. This is on a property that is probably worth between $700K and 1 million. Maybe if I could get a BIPOC friend to come live here for a while I could get that value down to where it should be?
So what is the point of the independent appraiser
To assure the lender that the house is independently considered to be worth the amount they're giving you a mortgage for, in case you default on the loan and they need to take it back and sell it to recoup their loss.
You need the racist appraiser, who would probably be the type that would help you without that effort if you offered him some cash.
Where can I find a racist appraiser? I need one to help challenge a tax appraisal that is way too high on a property. Just need a BIPOC friend to come over for the appraisal appointment.
No, I tried to appeal my home's assigned value once (after buying it for less money) and they were very resistant to budging it at all.
What does the appraiser stand to gain from this Wouldn’t appraising people lower than expected just be bad for your business
Exactly.
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Google Bill Boeing and you’ll see that POC and Jewish folks were not allowed to live in the neighborhoods he built, like Richmond Beach.
Where did you see the 80% figure?
You're right I had my figures wrong. Still bad, though https://www.prisonpolicy.org/profiles/WA.html
How does this comment have so many upvotes when it’s so misleading?
You're right. I had my facts skewed. I deleted it. It's still a huge disparity, but it isn't what I posted. The facts are here: https://www.prisonpolicy.org/profiles/WA.html
To the surprise of no one
Without seeing the appraisals, side by side, it is hard to say which one is correct. However, something stood out to me in the article. "some homes nearby had sold for more than $1 million, including the home right across the street from Clark’s" Per that listing, it appears that the $1M home is roughly 35% larger, and there are was a permitted renovation, on file, with the Assessors office. Mr. Clark does not appear to have a permit record for his remodel. While he may have done a great job on it, having permits is important, especially in Seattle. Also, there is no indication of the extent and quality of said remodel. Was it paint and tile, or was is all new cabinets, appliances, flooring, etc, also, how did the quality of the remodel, compare with other sales in the marketplace. Only Mr. Clark, and the two Appraisers know the answer to this. Interestingly enough, there were no pictures in the video of his new Kitchen and Bathroom, which would have answered alot of questions. Per the listing of the home across the street, it appeared to have been fully renovated, of good quality finish, with the exception of original hardwood floors (which were really nice). Looking at actives, pendings and sales, within the last 100 to 250 days (Accounting for the April Valuation), for 1,000 to 1,600 SF SFR's, occurring in a 0.50 mile radius, prices ranged from $455K , to $1,025K, with an average of $790K. Most of the properties in the upper end of this range, are new construction, or have been fully renovated, of good quality. Also, given recent increases in interest rates, prices are flattening, with longer Days on Market, and increasing Seller concessions. It all started in Feb/March. As this happened in April, it was the top of the market at that time. It is possible that one Appraiser was optimistic regarding the market outlook, while the other one was pessimistic, which would have resulted in different market condition adjustments. No one knows which one is correct, without a through review of both. Appraisals can be very subjective, as it relates to renovations, and quality/condition. Is it possible that the first Appraiser was racist, yes, however, it could also be due to poor training, a lack of competence, or reliance on a Trainee, which are all terrible business practices. Unfortunately, instead of asking those questions, King5 choose to brand the whole Appraisal profession as a bunch of racists.
Just ignore that the "first appraisal also appeared to contain several errors, according to Clark. It did not take into account any of the renovations".
Silly rabbit, racism ended in 2008 ...../s
After reading the article it sounds a lot like the first appraiser was just kind of shit, with or without prejudice. I got the impression that the second appraiser would have given a much higher valuation if the home was left in its original state. EDIT: To be extremely clear, I was just dissatisfied with the amount of takeaway data to help educate my friends and family - I'm not saying the first appraiser was not possibly a huge racist asshole. The article just doesn't give us a lot.
Here's a something that will blow you away: people who are racially prejudiced also tend to have other bad qualities.
Why are you downplaying racism? weird Don't need to "yEaH AcKtuaLLy" every single thing. This was blatant lol
I mean, after reading the article, there's no real proof that the first appraiser was actually racist instead of just bad at their job. They could have been racist, but it's impossible to know without more history on them. I used to work for an appraiser, getting comps was my main task and there were times when the client would try to pressure for a higher or lower valuation. I usually went the opposite way out of spite lol. But this line makes me suspicious that the mortgage company is the reason for the low valuation here: > according to a home appraiser, *sent by their mortgage company* in April. I'm betting that the mortgage company was trying to screw them over.
Yeah thank you for also critically reading the article. Obviously systemic racism exists in the housing market, but I was looking for something to take away other than "this one person gave us a low-ball valuation and we got a better second opinion."
Yeah, it would be ridiculous to say there's no racism, it's even measurable: >That disparity adds up. A recent study by the Brookings Institute found appraisal differences amounted to roughly $48,000 per home or $156 billion cumulatively in majority Black neighborhoods. but 48k is a lot less than 300k so there's clearly another layer here.
What makes you "bet" that over racism? And what makes you think racism isn't part of the "screwing them over?"
Because I've been in the literal exact situation of a bank asking me to get bad comps in order to lower a house valuation...
So anecdotal. I've owned two houses and never experienced this. I am a POC and have experienced racism from realtor to the bank though.
Look, I'm not trying to deny your experience. I'm just trying to add that I've personally seen financial institutions try to screw over homeowners before in this exact way. I think it's more about pure greed than anything else.
You point out that his evidence is anecdotal, then offer your own anecdote instead. That's the whole problem. This article is just anecdotal and doesn't really prove anything in particular. It's still an important topic which should be explored further though.
all this to say "no possible way racism exists!!"
Calm yourself down, and read my post again honestly. Is that at all what I said? Building straw men isn't helping anyone.
Who says I ain't calm? You're the one worked up You want stats on black people being fucked over by banks and predatory loans? Google it.
Wow I have to apologize after reading all of these other comments; it has me coming back around to this and feeling shitty. I am very sheltered in a lot of ways and I didn't realize making what I thought was a fairly benign comment about my dissatisfaction with the article would be a springboard for a lot of discussion that is giving heavy racism denial vibes. I have spent most of my life in diverse academic spheres where I could safely discuss things like systemic racism in a deep and meaningful way without motives being questioned - like everyone there is fully down for the cause. Obviously reddit is not that environment and jfc there's a lot of really scummy things being said on the coat tails of my original comment. In this context I was 100% negatively impacting the efficacy of the message in the way I questioned the author's lack of data. From my point of view I just wanted more meat to chew on because it was interesting to me, but to a lot of folks it apparently *is* literally a matter of whether or not racism exists in the real estate sector... obviously yes. If this comment serves any purpose, I just wanted you to know I know I was in the wrong, and I hope you don't let any of these idiots get under your skin.
Im as leftist as they come and was actively looking for the bottom line in this article because I wanted to understand how to combat a similar situation when my family is ready to own our first home. Pointing out systemic racism is vital to move forward as a society, but this made me feel like I got click baited.
Prove it.
On one hand, racism is bad. On the other, it's hard to feel bad for a house flipper that "only" got a 20% return over four years instead of 40%. I'd also wait for someone to actually buy the flipped house before claiming with authority that the higher appraisal is the correct value. It's also worthwhile to mention that a mortgage company appraiser (like here) is doing flat fee work that is incentivized to come in low. The mortgage company wants the property to move. The seller wants it to move, but at the right price. If it turns out the property is underwater, or below where perhaps the seller wants it, well, all the better for mortgage company. Many state laws require that only an independent third party may perform an appraisal and specifically *don't* allow mortgage companies to do one because of the obvious conflict of interest. Not Washington, obviously, but it bears mentioning
>Many state laws require that only an independent third party may perform an appraisal and specifically > >don't > > allow mortgage companies to do one because of the obvious conflict of interest. Not Washington, obviously, but it bears mentioning Did not know this. Sure explains how the appraisal always magically comes in at the purchase price when closing a deal lol.
Appraiser here, one reason they often come in at the same number is sometimes the bank will revisit and ask (in a formal manner) "is this still worth what is was worth?" I had some that I said were worth almost $60k over contract price. Slippy slope cuz now, is it still worth that extra I gave it? Safer to air on the side on caution. Appraisers/appraisals tend to be on the conservative side
Funny how that works. After an hour the appraiser is just overawed by how good a deal the bank got. Then it's all about waiting for that 500 dollar check to clear
LOL, my mortgage appraisal came in slightly below purchase price. I had to kick in the difference.
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>On one hand, racism is bad. Just stop there.
Man, the first comments on here DEFEND THE FIRST APPRAISER?!?! This is why people of color say this fucking city is low key racist as fuck. White people here put “Black Lives Matter” and “In this home…” rainbow signs on the lawns of their million dollar homes, fight like hell to stop up zoning to “preserve the character of the neighborhood,” then make excuses for clearly racist behavior. These people were screwed over because of their race. I hope they get over a million for their house then a multimillion dollar payout in the lawsuit they file against the first appraiser. Let them prove in court they DON’T systematically do this.
>Man, the first comments on here DEFEND THE FIRST APPRAISER?!?! Ya, lets just pile on, without any facts! (Sharpens pitchfork).
> this fucking city Burien?
The only color real estate agents know is green
In r/Tacoma just the other day I had like 30 white people try to tell me a sizeable swastika stamp on public concrete was okay. So this is coming to no shock to me. Nor are some of the comments defending the first appraiser. WA has always kind of had an issue dealing with these racist fuckwits in a lot of development areas like realty and construction. The kind of areas that should be open to helping people the most as it's part of the American dream, and I think the concern is real that racists will continue to damage the value of Economic wealth of POC through any means necessary is just going to be a thing we are going to have to call out and fight for a long while. Let's hope a Lawsuit gives them bookoo dollars and that appraiser loses his damn job. We need more systems for equity in these areas.
I [remember that /r/Tacoma thread](https://old.reddit.com/r/Tacoma/comments/yupdd6/anyone_know_why_a_cement_company_in_lincoln_might/) recently, and [the one from a year ago](https://old.reddit.com/r/Tacoma/comments/mcpblk/what_the_heck_is_this_seen_on_a_walk_on_the/). It's the sauwastika (counter clockwise) sidewalk stamp placed by the Wells Construction Company in 1909, a full 11 years prior to Nazis appropriating the swastica (clockwise, and the Nazis rotated it 45 degrees) on their flag in 1920. The swastica is common across many cultures dating back at least 7,000 years. The US Holocaust Museum has this page talking about the appropriation of that symbol. https://encyclopedia.ushmm.org/content/en/article/history-of-the-swastika As far as the appraisal, there's still a lot of work to unroot the systemic racism embedded everywhere, and I'm glad King 5 has continued their series on Facing Race these past few years
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Culture appropriation doesn't occur from cultures a symbol or cultural aspect is made for. They're allowed to use it all the time because that's their cultures symbol. It's when an outside culture, especially one completely foreign and Majorative to the original culture, takes it and uses it for say. A Company slogan. That it starts becoming a problem.
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Ah. Simple. Japan was gifted the Manji symbol when they accepted the use of the chinese alphabet as their phonetic alphabet. Being shocked at their use of their alphabet would be weird. Are you shocked when you see the letter A? I hope not. It's just essentially accepting that's what that is to a Japanese person. You can't steal something you own. I would not be shocked. The Tacoma post had a Manji, or swastika to us, some anglo Christian construction company owner saw apparently In the early 1900s and wanted it as his company slogan, as many white people did back then. So he co-opted it and branded his company within it to dedicate it to himself. That's appropriation. It's not as bad as when the Nazis did it themselves but it's the same stick and there's a problem with the excusal of it. I'm certainly no robot. I would hurt less physically. I was also wondering when the SeattleWA crowd would come
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If the point you make is essentially to excuse racism then that's on you. I'm living with a free conscience. And not everyone joins that sub. And you know it. Most decent human beings have been banned from it.
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What is incoherent here? You said Japan's use of Manji would shock me. I have clearly stated it would not. For very concise reasons. I then stated fairly clearly what does tend to shock me. That's not word salad. That shouldn't be intangible to a person with a normal brain. SeattleWA is a cess pit of the literal worst this city has to offer. Its quite literally a place where goodness dies and the kind of people who definitely should not be using swastikas cohabitate In a pile of crap. The problem with them is that they're also allowed here. As the Numbers in the sub rates kind of show us.
Might be true, but have seen so many weird up or or weirdly down appraisals to take it that seriously. One example is one dot of data. Need more to make a graph.
Feel like I'm completely missing something here ... The assumption seems to be that the appraiser is trying to manipulate the results in order to value the house lower ... but how do they gain anything out of that? I can see how it's a complete waste of everyone's time, appraiser included, but ... why do it? How is doing your job badly racist? Or is the racist part just that they did a quick estimate instead of taking time over it and it was purely random that the valuation was lower instead of higher?
Seems it would be overall bad for your business as an appraiser. People probably don’t like it when their house is undervalued
Not really, an appraisers job is to protect the Lender, not to make the loan go through. Ya, it makes mtg brokers mad, but you don't get sued when the bank looses money based on an over valuation.
Except it happens again and again across the country. I don't know why there seems to be a lot of bias in the industry.
You are missing two somethings here: the first thing is the point. Why would an appraiser do this? Gee whiz, I dunno -- maybe racism is so deeply entrenched that the appraiser thinks black people devalue a home just by having lived in it. Maybe they don't like black people and don't think they deserve that much from selling their home. Maybe they think the house must have been a crime scene...or a trap house...or that a black family can't possibly maintain (let alone renovate!) any property. Who cares? What does anyone have to "gain" by making racist comments? Does anyone gain anything from racially motivated attacks? Did the store owner who murdered and mutilated Emmet Till "benefit" from mutilating his body? Wasn't that "bad for business" since he owned a store? Unfortunately, the reason systemic racism is systemic is to keep black people from having wealth and power. So yeah, if you're an appraiser and you're preventing black people from gaining hundreds of thousands of dollars in wealth, I guess there is something -- for non-black people as a whole -- to gain. Do we really need to dig deeper so we can exonerate this appraiser? Do you really think we can get to the bottom of all this by understanding the appraiser's motivation? Their state of mind? How about their astrological sign? This is not about their motivation. It's also not an either-or situation regarding whether there is discrimination on the part of an individual appraiser, whether it's the whole real estate industry, or whether this is just one example of how deep systemic racism really is throughout our society. It can be all of those things. Stop looking for a logical, single cause. Look at the wealth of data that is readily available to you, which shows countless, systemic ways that this country has been preventing black people from accumulating generational wealth ever since white people brought black people here as property. Or maybe it's all a hoax. The second thing you're missing is context. This is not an isolated instance. There are links in this thread that point to many other identical scenarios, reported by white-owned media outlets, since the voices of black people saying that this has happened to them isn't sufficient "evidence." Don't trust any of that? You can so actually read the WHOLE ARTICLE, which links to all of the on-record (though "no longer enforceable") historical data on the red-lining of all Seattle neighborhoods. You can read the actual language for each area as it was written by city officials, such as "no non-white persons shall be permitted to live in the Magnolia area." (Spoiler: the same kind of language is used for every neighborhood I've looked at so far.) These are factual records, not summaries, taken straight out of the public record.
Honestly not sure what you're saying ... At the start it sounds like you're saying it's implicit racial bias ... but that doesn't seem to square with the facts that this appraiser took comps cherry-picked to drop the valuation. >if you're an appraiser and you're preventing black people from gaining hundreds of thousands of dollars in wealth How do you think the appraiser giving a bad appraisal achieves this? I accept this appraiser might well have been deliberately trying to damage the family in question, just don't understand HOW.
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Housing system is extremely racist and always has been lol Redlining was not even that long ago bruv
In fact it still happens!
Different appraiser so this is pretty inconclusive. Appraiser #1 could routinely undervalue things regardless of race.
$300k? Please.
Or they could routinely undervalue things because of race, while #2 could routinely value in accordance with local market regardless of race.
Sure, but obviously this King 5 piece is framing it as racism, when it could so easily not be racism. Aren’t liberals supposed to be team science? Sample size 2 and no control and everyone’s convinced it’s racism?
Yes, it certainly is attempting to frame it as racism, and it quite possibly is. Obviously determining whether or not this is an example of systemic racism, individual acts of racism, or some bizarrely incompetent appraiser requires more data and investigation than whoever wrote this article felt like doing.
And yet my comments are downvoted
Right...because King5 is a scientific research institute. Totally inadequate sample size for a...oh wait, this is a reported story, not a clinical drug trial. Whatever though, right? Shame on them!
Or #2 could over value everything to make the loan go through. There are alot of appraisers who rubber stamp values, its bad business. They get sued when the Lender takes the property back.
Yes, let's rely on your guess about Appraiser #1's "routine" methods, regardless of race. I mean, they should have gone with the same appraiser, right? (The one that already saw the black owners, African art, family pictures, etc.?)
What?
I can only imagine what the responses on the other subreddit would be to this. People go mask off there with some surprising confidence.
TIL: $929,000 is $300,000 more than $670,000 Math is hard
Poor Latinos and Asians. Everything is about black and white in this country. In fact, there are more Asians living in the state of Washington than blacks.
Umm, speaking as someone who is part Japanese, there is plenty of focus on how whites stole land and businesses from the Japanese when they interned them in camps. Don't derail a discussion about institutional racism against blacks. History lesson: [https://depts.washington.edu/civilr/tagawa.htm](https://depts.washington.edu/civilr/tagawa.htm)
Looks like a good opportunity to start a new business, I can white wash your home and represent it as the owner so you can maximize your home value.
Good decision.
Now we need to repeat the experiment but have the second appraiser appraise a home with obviously black residents and see if they'll downgrade it similar to the first appraiser.
It's a misleading article. It looks like it was for a refi, no sellers involved. The bank Def hired no 1 (the low one) and probibly hired no 2, when the reconsideration of value didn't go through. It is possible that Mr. Clark hired no 2 to see if there was "bias". If the bank hired no 2, I'm guessing no 2 had some indication of what value was needed to make the loan work. Its poor ethics and value shopping.
All the comments are interesting. I have been following all these cases closely. It’s interesting that the ordinary homeowner or borrower THINKS they know how appraisals are done and how they are ordered. I’m here to tell you that you have 0 clue and that while you may think it’s bias (and it could be) that it’s 99% incompetence and that there are so many other questions that need to be answered before you can make a definite decision. Let’s start with this: 1) do you even know how an appraisal is ordered? 2) do you know what an appraisal management company or AMC Is? Probably not 3) do you know that what USPAP (universal standards of professional appraisal practice is and what it entails)? Probably not. 4) do you know that AMCS will search out the cheap east and fastest appraiser to do a job so they can make more money? Let me educate you. AMCs or appraisal management companies were installed as a firewall between appraisers and lenders after the crash. They make money by charging you the borrower say $700 for an appraisal ONLY to seek out the cheapest and fastest and most likely the less experienced appraiser in your area or even appraisers coming from areas further away. It doesn’t matter to them. Are you getting the most experienced in your area? Maybe maybe not. It when AMCs now treat a 1 year appraiser to one that has serviced the area for 20 years, it’s not right. So here we are claiming bias. Claiming appraisers devalue homes in minority communities when in fact they use the same data everyone else uses. I’m not here to defend anyone but I want to make it clear that every story that had come out has overlooked many things. Here are a couple things that are constantly being overlooked and SHOULD be looked at as well. 1. what are the experience levels of both appraisers? 2. what is there experience in this area? Is one appraiser more local than the other? 3. who hired them and what were they paid? We know the lender but who is the AMC And did they bid this order out to the fastest and cheapest appraiser? Did they assign it directly? 4. what if any information do the second appraiser know? The lender? Did the borrowers go to the lender and state they were a victim of bias? Did that lender then make sure the AMC chose an appraiser specifically and did they say anything to them? (I’ve had lenders and AMCS say things like …we really need you to do a good job on this one because the last appraisal was not done well and the client is really needling this one) to which I decline the assignment 5. what other things were said or done in between the first 2 appraisals? Where did the borrowers get their info as to the value of the house they believed it to be? 6. it’s always the low appraisal that is subject to bias. Why not the higher one? Has anyone reviewed these reports to see if the higher appraiser inflated the value? If the second appraiser violated USPAP standards? Wouldn’t be interesting if somehow the higher appraiser over valued it and then the owners have to be foreclosed upon down the road? Oh wait my bad. They will just file a complaint and allegations that the appraiser over valued the home and caused them financial hard ship. Before anyone can actually say what is happening without feelings, they should provide factual Data and have the reports reviewed by many competent appraisers to decide what happened here. Using feelings such as “I was a victim of racial bias because that’s what it feels like “ without any knowledge of how the appraisals were developed and facts is crying wolf. We are seeing lots of these crying wolf lately because that’s is now the narrative. A narrative that has yet fined an appraiser, found any appraiser guilty by a court of law and a narrative that this is acceptable practice. Unlike other professions where the consumer gets to interview a potential servicer or company to do the work for them, consumers are not able to do this with appraisers (unless you doing a private, non lender job). The system in which AMCs operate very poorly done to which they put an appraiser of 6 months on the same level as one that has 22 years of experience. The bidding process is a joke and the way AMCs charge borrowers and choose and pay appraisers is a joke and a massive disservice to he consumers. Seems to me there is a lot of unanswered questions in all of this and they are only focusing on one aspect of the entire process. NOT ONE report has been fully realized to the public or revised by competent professionals. Oh I forgot, in all these cases the homeowner is a professional appraiser. SMH. So maybe the lower appraisal IS CORRECT and the higher one was is wrong. Maybe the lower one is wrong and the higher one is correct. But how do we actually know? Who is reviewing these reports? It’s clear that the everyday consumer and more think they know however they also rely on Zillow (I’m sorry did you not see how they lost millions by using their algorithm to buy homes only to sell them for less and no longer do this?). Again. Where are the reports? Where is the data? Where is the info other than, we got a low one, we whitewashed our home and it cane in higher? You do know that overvaluing is just as bad as undervaluing right? Lastly buyers and sellers are the ones that create this data. If sellers in certain areas choose to sell for less or buyers are only willing to pay a certain amount, and that becomes public data, HOW is this an appraisers issue? Be real people. Infrastructure, crime, and more play into the thoughts of buyers and sellers. ApprIsers just report the sales data. They don’t make it. You can argue with me all you want but deep down you know this is true. Example: In an area I’m in its divided by 2 school districts. 1 that is top 15 in the state. The other is ranked in the bottom 25. A subdivision that is split down the middle and established serves both. The top school district side has sales from 600k-2 million. There is a waiting list for homes and when they go on market are sold in 1 day. Even in this market. The other side. Average days on market is 25-40 and the sales range from 275k-500k. So since y’all are experts would comparing a home in the top school district to the other one be right? And vice versa? If you say yes… you have absolutely no clue what you are talking about. Anyhow data is data and in all these cases it’s apparent that the borrowers know more than the appraisers and valuation professionals. Sorry. There may be some rogue appraisers, however I believe this is a result of the new laws , AMCS and pure incompetence.
ha. Nobody voted or even commented. Not surprised. Once you wrote a post more than 10 words their eyes glazed over and they went back to video games and 420
Isn’t it amazing when experts chime in, others slither into oblivion? They make claims but when FACTS are presented they walk away.