SAN FRANCISCO — A lawsuit filed in federal court in San Francisco accuses a real estate appraisal company of discrimination, unfairly assessing home values based on the race of the owners. The Fair Housing Advocates of Northern California filed the lawsuit on behalf of Paul and Tenisha Tate-Austin.
According to the lawsuit, the Austins renovated their home, purchased for $550,000 in December 2016. In December 2020, the Austins received an appraisal for their home for $995,000 from Janette Miller, but suspected the appraisal was low and ordered a second appraisal by a different firm, the North Bay Business Journal reported.
According to the complaint, the Austins “erased any evidence of their racial identities inside their house, even asking a white friend to pose as a homeowner during the inspection. This different appraiser arrived at a value of $1,482,500 – nearly half a million dollars higher than Miller’s estimated value.”
The Austins said they believed race was a factor in the two estimates, saying the first appraisal contained what they believed to be coded language, as in “Marin City is a distinct area,” KGO reported. The family told KGO they believe the difference in appraisals is the result of larger, systemic race issues in the U.S.
A 2018 study by the Brookings Institution found that in average U.S. cities, neighborhoods where the population is 50% Black are valued at roughly half the price as homes in neighborhoods with no Black residents. The study also found that areas with a greater devaluation of Black neighborhoods saw more segregation and less upward mobility for Black children.
The defendants named in the suit did not comment on the allegations.
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