PHILADELPHIA (KYW Newsradio) — Philadelphia’s new appraisal bias program hoped to attract a new, more diverse generation of appraisers at an information session on Thursday at Temple University’s Center City campus.
Mayor Cherelle Parker said it’s hard to get people excited about real estate appraisals.
“I must say that it is not a sexy issue,” she said. “I mean, I don’t walk into a room as the mayor of the city of Philadelphia and begin talking about appraisal bias and have people say, ‘Yes! That’s an important issue.”
However, she said, it’s a significant factor in the wealth disparity between Black, Hispanic, and white Philadelphians. Low appraisals rob homeowners of value and can make mortgages impossible to get, blocking would-be buyers from getting into the housing market.
City Planning Director Jessie Lawrence said it adds up.
“The Economy League of Philadelphia has estimated a $57 billion gap in appreciation of values between comparable properties in majority white neighborhoods and those that are non-white, specifically in Philadelphia over the last seven years,” he said.
Research from the Reinvestment Fund, released in September, also showed a long-term bias in how property value is calculated differently in white versus minority neighborhoods.
“There’s a much greater and persistently greater chance that appraisals for homes in Black neighborhoods come in below the contract price, the price that the two parties agree on,” said Ira Goldstein, the Senior Advisor of Policy Solutions of the company.
“We tell everybody to go out, buy a home, and put your money into it, and let it appreciate. It’s the single investment that most ordinary people have available to them, and you are disadvantaged if you are a person of color.”
Perhaps not coincidentally, Goldstein said more than 95% of appraisers in the Philadelphia area are white. It’s a problem Mayor Cherelle Parker identified as a possible weakness in her HOME initiative, so she created the Home Appraisal Bias Program. The director, Andy Toy, sees an opportunity in the expected turnover in the appraisal industry.
“We need many more appraisers in Philadelphia, I believe,” Toy said.
“The media age right now is 60, and this will be solved by having more young people and other people of color, and people in neighborhoods coming into the industry.”