Teaching Appraisers to be Biased?

[ucbruin]

Still a massive over-reaction....
Appraisers probably have a higher risk of dying from Covid....

 

[J8012]

Im so tired of being manipulated by the imbeciles behind the curtain. We let the smallest minds creep to the top as they are the easiest to control. Our systems reward the weak and incapable for being pawns to a narrative. Take a look at the overall course curriculum we are now routinely subjected to. No one is going to tell me what I think. I have been with myself my entire life, this jerk just showed up. I know when Im sick or not as well..... the number of people who have just given up their minds is horrifying.

 

[alebrewer]

The following was reportedly included in a McKissock CE course. I guess this would be the opportune time to resurrect "public interest value" from the early 90s. The same "non-economic principles" could be leveraged and expanded.

In the same article, Mr. Mock writes, “The sales comparison approach, the primary appraisal method used by real estate professionals for owner-occupied homes, requires appraisers to determine a home’s value based off the sale prices of similar homes in the same neighborhood. Because of racial segregation’s enduring effect of undervaluing Black neighborhoods, this approach has carried the legacy of artificially depreciated housing prices from the days of redlining into the present, while allowing for houses in white neighborhoods to appreciate over time. The appraisers’ current valuation processes have not only been exacerbating the racial appraisal gap, but also the racial wealth gap, given that homeownership is one of the primary ways that U.S. families accumulate wealth.”

According to the article, the Brookings Institute has launched an initiative that will award up to $1 million to the person or organization that can come up with a new method or technique for appraising residences that will produce racial equity.

I don't disagree with anything said herein. Past discriminatory actions ARE still impacting current valuations. It would be silly to try to argue otherwise. Has nothing to do with appraiser bias - it has to do with past discriminatory activities. That is why I have contended - and will continue to contend, that the SCA will come under fire by those seeking to right past wrongs through the valuation process. One cannot overlook clear market preferences AND develop a supportable SCA at the same time. They are mutually exclusive.

 

[Terrel L. Shields]

ne of the Brookings guys made some crack about perhaps we need to go to the cost or income approaches to overcome the racist nature

Ultimately, all approaches rely upon the INCOME approach...because it's money that is at stake. What is the alternative to rents - cheaper to own or rent, which pays the way? Cost reflects the expense of doing it today. Sales reflects what happened yesterday. Income is the one forward looking approach. What is the future benefit of owning vs renting.

 

[Terrel L. Shields]

If they want to "right the wrong" then allow banks to lend 50% over MV for those old Redlined areas. Uncle Sugar will guarantee the difference. That will fix it right? Right? Doesn't anyone believe the obvious? Higher prices mean higher rents and many live in these low-cost neighborhoods because rents are cheaper. Poor people trying to live within their means. Doubling the value of their homes doesn't mean they can safely arbitrage some additional borrowing power and somehow magically become wealthier. In fact, it is liable to make them poorer.

 

[Lee Lansford ASA]

"They" don't like markets when the market goes against their preferred outcomes. Politically and philosophically, what group has been against markets? There's your answer to what is happening.

 

[J8012]

If they want to "right the wrong" then allow banks to lend 50% over MV for those old Redlined areas. Uncle Sugar will guarantee the difference. That will fix it right? Right? Doesn't anyone believe the obvious? Higher prices mean higher rents and many live in these low-cost neighborhoods because rents are cheaper. Poor people trying to live within their means. Doubling the value of their homes doesn't mean they can safely arbitrage some additional borrowing power and somehow magically become wealthier. In fact, it is liable to make them poorer.

Hey, don't be implementing logic and reason. Lol

 

[J8012]

"They" don't like markets when the market goes against their preferred outcomes. Politically and philosophically, what group has been against markets? There's your answer to what is happening.

They are all on the same team at this point, just one is more brazen than the other so we can argue amongst ourselves about it while they sit high on the preverbal hog.

 

[CGinMN]

I don't disagree with anything said herein. Past discriminatory actions ARE still impacting current valuations. It would be silly to try to argue otherwise. Has nothing to do with appraiser bias - it has to do with past discriminatory activities. That is why I have contended - and will continue to contend, that the SCA will come under fire by those seeking to right past wrongs through the valuation process. One cannot overlook clear market preferences AND develop a supportable SCA at the same time. They are mutually exclusive.

Housing markets are naturally sorted by socioeconomics, and socioeconomics strongly correlates to demographics. For example, there are 55+ communities that were built up in the past 10 years that are 95%+ white. In these neighborhoods, it is not uncommon for half the transactions to be cash. Redlining played no part historically, and appraisals were a non-factor in the majority of transactions. Instead, you have to consider that the U.S. population was about 87% white in the 1970 census, and the offspring of that population are now turning 55. Did those boomer babies have more opportunities to generate wealth during their lifetime? Yep. The makeup of housing markets is evidence of that, but it is not responsible for it. Stock market wealth is also heavily tilted toward older whites. To resolve this do we change how we value stocks? It is asinine to even debate the merits of that idea, yet here we are.

 

[shrubberyvaluation]

They talk out of both sides of their mouths for most policiticians, Kamala included. They speak of affordable housing in one sentence, and then having higher property values in the next, depending on the audience. And then you demonize appraisers for both at the same time.