Indianapolis woman's home appraises at $100,000 more after she removes evidence that she's Black

[catbyte]

Travis Gettys
May 06, 2021



An Indianapolis woman says her home was valued substantially higher when she removed evidence that she's Black.

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Duffy learned of a recent New York Times article on racist discrimination in the appraisal process, and she decided to apply some of the lessons she read about.

"I decided to do exactly what was done in the article," Duffy said. "I took down every photo of my family from my house. … I took every piece of ethnic artwork out, so any African artwork -- I took it out. I displayed my degrees, I removed certain books."

Duffy asked a white male friend sit in on her home appraisal and didn't declare her race in the application or other communications with the appraisal company -- and the appraisal came back at more than double the first two, valuing her home at more than $100,000 higher.

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https://www.rawstory.com/racial-discrimination/

https://fox59.com/news/indianapolis-homeowner-files-discrimination-complaint-after-removal-of-black-identifiers-leads-to-100000-appraisal-increase/

[ProfessorGAC]

1. I'm Disgusted By This

The house is worth what it's worth. Where is it? How big is it? How well has it been maintained?
Who lives in it should have nothing to do with the value of the house.

[2naSalit]

2. Glad she's suing. K&R

[jimfields33]

3. Suing? Her property taxes are according the home worth

I some times think I need a new assessment because my taxes are higher then my neighbors who have bigger homes.

[spooky3]

5. Did you watch the video? She is applying for refinancing

To get a lower rate and buy a grandparent’s house to help them. She needs the highest fair appraisal.

Appraisals aren’t the same as tax assessments.

You can appeal your unfair assessment, if your county/city is like most.

[jimfields33]

6. No. Dummy me. I will go watch it.

Thank you.

[spooky3]

7. No probs!

[LanternWaste]

31. 'dem old knees do jerk...

[Hekate]

4. 5th Rec. This is disgusting.

[Cracklin Charlie]

8. Her face is perfect.

Did you see this story, Sen. Tim Scott?

Racism is alive and well.

[Faux pas]

9. Kickin' with disgust!

[soothsayer]

10. Fannie and Freddie introduced some cool software that takes humans mostly out of the appraisal proce

To combat this kind of thing.

[Lancero]

21. And as facial ID systems show, computers are as racist as the people who program them are.

[intheflow]

32. Yep.

As we used to say in the early days of coding, "Garbage in, garbage out."

[uponit7771]

41. +1,

[dsc]

11. It would be one thing if we were talking say a difference of $2000 on a $100,000 home

since there is some amount of 'art' to this as opposed to science, but an over 100% error is absurd. The story appears to point to them using inappropriate comparison houses to hers as the issue which was directly linked to her race (they used houses in Black areas that were not close to her house in the first two, and houses in her neighborhood for the 3rd one).

[IrishAfricanAmerican]

12. smh...

#SystemicRacism #RacistCountry

[Dream Girl]

13. I'm pretty sure this happened to me a few years back. I was shocked at the low appraisal .

It didn’t really matter, it was for a refi. But I wonder if that I acted my interest rate.

[BobTheSubgenius]

14. I worked for an appriaser in Vancouver, many years ago.

The "game" was that the bank needed a certain value to justify the mortgage, the buyer wanted to buy, and the seller wanted to sell.

Our job seemed to be finding ways of making that home a good basis for granting the loan.

[MissB]

15. I had an appraiser outright ask what we needed

We bought the fixer upper in the neighborhood, many years back. We refi’d to a 15 year about 7 years ago, triggering the need for an appraisal.

Our house is almost 100 years old. It’s big for the era, but most houses of this vintage in our neighborhood have been torn down and replaced with literal mansions (not McMansions). People buy perfectly good houses for a mil, tear it down and spend several mil building a new one.

So it’s hard to get comparables. Our neighborhood boundaries are the school boundaries and the district is sought after (currently no home available under 2 mil in our neighborhood.) Our home isn’t worth that much. It’s be overpriced for what it is but we’d still approach a mil.

The guy asked what we needed. I told him; the appraisal came to just over that. It felt weird to tell the guy what I needed and then pay for the report. But I got a great rate on the mortgage.

[BobTheSubgenius]

42. That's the business I remember!

In your case, they knew they were on firm ground, though. In a market like that, how could they lose money betting on you paying the mortgage, or having it collateralized if the worst happens?

Isn't it insane? The average price of a single-family here in Victoria is $1.2M. How do people manage that?

[spooky3]

25. I think the law changed after the 2008 crisis, to prevent that.

But even so, there is still a lot of subjectivity, as others have said.

[BobTheSubgenius]

43. Here in Canada, we've always had pretty decent banking and real estate rules.

And the time of my experience in the business was in the 1970s, long before things went berserk.

[StarfishSaver]

16. When I was a kid, our house was on The market but getting no takers

The realtor told my parents that several prospective buyers looked at the photos on our walls and asked if a Black family lived there. When told yes, they immediately lost interest.

At the realtor's suggestion, we removed all evidence that the home was occupied by a Black family, and it sold within days.

[intheflow]

33. I'm so sorry that happened to you & your family.

Like, wtf would it ever matter who lived in your house before you buy it? My house was obviously chock full o' junkies at some point, based on the number of works we've found while remodeling. It's still a great house.

[bluboid]

17. this lady is BRILLIANT!!!

thank god for trail blazers like her!

[oldsoftie]

18. EVERY Realtor will tell you to remove all personal identifiers

People dont think normally when looking at a house. They have to see themselves in it. They cant do that with reminders of the current family all over the house.
Every house I've ever sold went for far more after getting people to do what this lady did
Its been that way forever

Now the competence of the appraiser & their comps is another story. And again, I've seen the same problem; a comp far away from the neighborhood when there are comps nearby. Part of that is a leftover from the 08 crash; the govt required banks to use appraisers off a list instead of picking their own. The result was we got appraisers who didnt know the local market coming in and screwing prices

I'd like to follow this story and see what other info becomes available after she goes to court.

[h2ebits]

27. Yes, this is happening

"The competence of the appraiser & their comps is another story."

The "fix" to the problem of banks picking their own appraisers so they could hand out loans for far more than the house was worth and "qualify home applicants" regardless of factual income, also has issues.

I am now in my fourth and, hopefully, final home that I purchased August, 2011. My loan company requested an appraiser from a list and the woman who did the appraisal used comps that were several miles further away from the downtown area in an effort to establish value. This was despite the fact that several units in my two building complex and other condo units much closer in to downtown were available to use as comps. The appraisal came in lower than the agreed upon price (which was lower than the original asking price) by $20,000. My loan originator contacted the appraisal company and made them send another appraiser who understood the dynamics of condos in a downtown area i.e. the closer you live to downtown, the higher the price is for a condo. (Don't get me started on the increase in price floor by floor as you move up to higher floors.)

I would also like to follow this story to see what other info comes out.

[spooky3]

28. Several years ago, a friend told me about an appraiser who picked

Houses in Purcellville, VA, more than 50 miles from the appraised house, and in a much more rural area than her neighborhood close to DC. Duh!

[h2ebits]

29. I find real estate to truly "let the buyer beware."

[oldsoftie]

35. How aggravating that must've been for you!!

And a perfect illustration of the problem

[Solly Mack]

19. K&R

[FakeNoose]

20. Going out on a limb here, since I don't work in real estate

I'm a single woman homeowner, but that's my only claim to "expertise."

The limb I'm going out on is the assumption (?) that white buyers would not be interested in purchasing a home from a black owner. OR that white families don't want to live in a racially mixed neighborhood. Therefore the customer base would be less than half for a black home seller than for a white home seller. The prices need to stay low for black sellers because there won't be any anxious buyers willing to bid up the price like they do for the houses in "white" neighborhoods.

So I live in Pittsburgh, in a fully integrated area of the Northside, and I have seen many times that buyers will purchase the house they want regardless of the previous owner's race. If it's the house they want in the area they want to be in, and if the price is affordable, they'll buy it. "For sale by owner" is your friend.

The steering to certain areas happens when the real estate agents get involved and tell you where to look. It's their (racist?) attitude that drives the demand for certain neighborhoods and certain school districts. Avoid the real estate agents and search for houses on your own, and you'll be free of their baggage and assumptions.

[AllaN01Bear]

22. racisim is and has been alive and well for a very long , long time .

[WestIndianArchie]

23. What?

I thought they said america isn't a racist country.

[gldstwmn]

24. Appraisers use comparable sales so what the hell

were the first two using?

[spooky3]

26. It would be easy to do in some places. In my neighborhood, comps can be 50%

Last edited Thu May 6, 2021, 04:24 PM - Edit history (1)

Or more different, if they are just a few blocks away, or if one is on a busy street and the other isn’t. A racist appraiser could select the wrong houses to compare to this woman’s house.

The article states that the earlier appraisers selected houses in “Black neighborhoods” more than a mile from the plaintiff’s house, rather than comparable houses in her neighborhood.

[catbyte]

36. They were usings comps from a couple of miles away in a "less desirable" area.

[gldstwmn]

37. They're going to lose their license now

at the very least.

[uponit7771]

40. +1,

[uponit7771]

39. Comps from more than a mile a way where there were most likely sales near her. The ...

... two first appraisers really fucked up and have some explaining to do.

[BadGimp]

30. She seems a tad irritated :)

And she should be.

[Blue Owl]

34. Tell us again, MAGAts, how there's no racism in the U.S. of fucking A...

[uponit7771]

38. Fuck ... this hits like the MIT resume name study (link inside) We can't even fuckin get a fair

... shake getting a lone from a bank.

Resume name study, black names wont get hired
https://www.shrm.org/hr-today/news/hr-magazine/pages/0203hrnews2.aspx

[soldierant]

44. So now you know what realtors actually mean when they say

"Location, location, location." (If you didn't alrady know.)

[BlueMTexpat]

45. Blatant

racism indeed!

[Hortensis]

46. Lenders considering lending first evaluate properties on line via available market data

to get an idea of value, mostly a matter of typing in an address. If they decide to move forward, they may send out an appraiser. On-line appraisals of course don't see "evidence" that an owner is black, at least none that can be removed, so it'd presumably have been something like $100K higher than came in.

Lenders really do want to lend money, and a discrepancy like this would threaten to kill the deal and of course be pretty noticeable. A way of saying, I'm guessing this appraiser is not working for that lender any more. Or possibly any other if someone was responsible enough to report this to the licensing board, and I do hope so.

[twodogsbarking]

47. Realtors.

Never trust one.

[AngryOldDem]

48. Indy is infamous for this.

Where this home is located is near an area that was the cultural mecca of Black Indianapolis from about the turn of the century to the 1950s. Think Madame C.J. Walker. Then urban development started and most of the homes and businesses were torn down to build the campus of Indiana University-Purdue University Indianapolis. It’s now a run down shell, with the exception of IUPUI.

Redlining was rampant, and many predominantly minority neighborhoods were also bulldozed for construction of I-70 and I-65 back in the late ‘50s-early ‘60s.

[shenmue]

49. Oh, sh*t.

Why, as a country, can we just not get our sh-t together?