A Black California couple is suing a real estate firm that they claim undervalued their home during an appraisal because of their race.
Paul and Tenisha Austin purchased their home in Marin County back in 2016 for $550,000 then made around $400,000 worth of extensive renovations, including an added 1,000 square feet of space, a deck and new appliances. When trying to refinance their mortgage last year, according to the Independent, the national national appraisal company AMC Links LLC hired the company Miller and Perotti Real Estate Appraisals to appraise the home.
The Austins knew something was off when real estate appraiser Janette Miller appraised their home at $995,000. So they called a white friend of theirs who agreed to act as the owner, staged the house with their white friend’s photos and artwork, then ordered a second appraisal.
I’m pretty sure you know where this is going.
From the Independent:
The couple’s legal complaint said that when a different appraiser came and inspected the Austins’ home, the appraiser arrived at a value of $1,482,500 (£1,120,391), a nearly 50 per cent increase in the home’s value.
The complaint noted that Marin County has a long history of stereotyping as well as redlining — a practice of racial discrimination whereby banks and other institutions treat households in areas populated by ethnic minorities as being a greater financial risk.
“Likewise appraisers, including defendants, have continued to use race-based criteria in assessing property value, including limiting comparisons to houses within areas of similar racial demographics and valuing predominantly white areas more highly than other areas,” said the complaint.
Marin County’s population was 85.3 per cent white, 2.8 per cent Black, 6.6 per cent Asian and 16.3 per cent Latino as of July 2019, according to the US Census. The county’s Black residents are overwhelmingly concentrated in two census tracts, one of which is located in Marin City, said the complaint.
“We believe the white lady wanted to devalue our property because we are in a black neighbourhood, and the home belonged to a black family,” Mr Austin told the San Francisco Chronicle.
The lawsuit, filed by the Fair housing Advocates of Northern California on the Austins’ behalf, alleges the appraiser and AMC Links LLC violated the California Fair Employment and housing Act. According to the North Bay Business Journal, the suit says the Austins civil rights were violated and they “suffered damages, including loss of financing opportunity in connection with their dwelling, economic losses, emotional distress with attendant physical injuries.” The suit is demanding a trial by jury.
“We believe that Ms. Miller valued our house at a lower rate because of our race and because of the current and historical racial demographics of where our house is located,” Paul Austin said in a statement, according to the Business Journal. “The sales comps that the appraiser chose to use were unsuitable and were guaranteed to lower the value of our house.”
Homeownership is important for generational wealth building and Black people have been historically shut out of it by discriminatory policies, redlining, and other types of systemic oppression. According to the Independent, the real estate firm, Redfin, reports that in 2020, 44% of Black Americans owned homes compared to an unsurprising 74% of white Americans.
“I want to see a change. I don’t want to see my children have to deal with this,” Austin said, according to the Independent.