WASHINGTON, DC, March 23, 2022 — The National Housing Conference commends the work of the Property Appraisal and Valuation Equity (PAVE) Task Force, led by Housing and Urban Development Secretary Marcia Fudge and Domestic Policy Director Ambassador Susan Rice. The report’s recommendations are essential steps to dealing with the enduring problem of racially biased appraisals.
“The initiatives announced today are critical to eliminating racial bias, improving appraisal accuracy, and opening access to more affordable, sustainable homeownership opportunities for minority borrowers,” said David M. Dworkin, President, and CEO of the National Housing Conference. “Accurate and fair appraisals are the foundation of sound mortgage underwriting and sustainable mortgages that equitably serve all Americans.”
The PAVE Task Force recommendations include:
- Making the appraisal industry more accountable, noting that “the appraisal industry, which has long operated in a relatively closed and self-regulated framework, has not been effective at addressing deep-rooted inequities.” NHC looks forward to working with the PAVE Task Force on modernizing the appraisal industry in statute and through improved regulation.
- Empower consumers with information and assistance. NHC believes that homeowners and homebuyers need to understand their rights and independently evaluate the fairness of appraisals in a timely manner.
- Prevent algorithmic bias in home valuation. Automated Valuation Models (AVMs) are an important part of appraisal modernization as long as the algorithms that drive them are accurate and equitable.
- Cultivate an appraiser profession that is well-trained and looks like the communities it serves. As noted by the PAVE Task Force, the appraiser/assessor profession is roughly 97 percent white, making it one of the least diverse professions in the country.
- Leverage federal data and expertise to inform policy, practice, and research on appraisal bias. Data-driven solutions are essential to sound policy changes.
NHC looks forward to working with our diverse members and the PAVE Task Force to ensure that this report is the first step in a successful effort to bring the appraisal process into the 21st century and expand sustainable homeownership for all.