The Legacy of Red-Lining: Racist Home Appraisals

Millions of recently released records show that racist home appraisals are a real and growing problem

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We often think of red-lining—the practice that relegated Black people and other people of color to certain neighborhoods—as a bygone policy that illustrates how the racial wealth gap was created.

It would be a mistake, however, to think that homeownership has transcended the racist history of legalized red-lining. The practice maintains a legacy in the form a ubiquitous but under-examined practice—home appraisals.

In a new study called “Appraised: The Persistent Evaluation of White Neighborhoods as More Valuable than Communities of Color” by Dr. Junia Howell and Dr. Elizabeth Korver-Glenn, they examined recently released records of appraisal reports—the first time such data has ever been available for this kind of study.

Photo Credit: Tierra Mallorca

The data scientists looked at cities that had metro areas of over 500,000 people and at least 50,000 people of color. The findings were clear—"The higher the proportion of white residents in each community, the higher the appraised value of individual homes.”

And the problem is getting worse. The report also states that, “Among other results, we find that neighborhood racial inequality in appraised values grew by 75% in the past decade and that the COVID-19 pandemic and its associated monetary policy further exacerbated this inequity.”

The Bureau of Labor Statistics shows that 97 percent of home appraisers are white. Such a racially lopsided industry is acutely vulnerable to unconscious bias against Black homeowners and other people of color.

From the report: “Appraised”

This report on racial inequality in home appraisals demonstrates once again that racism is less a matter of attitudes than assets. The detrimental effects of racism are not only psychological but material as well.

A lack of wealth negatively impacts all kinds of quality-of-life factors such as access to quality health care, the resources available for formal education, and what resources can be passed on to the next generation.

Until our elected officials, business owners, pastors, and the populace treat racism as a crisis of material inequality and not simply one of personal prejudice, the gaps in wealth and well-being will continue to grow.

What experiences have you had with inequality in housing appraisals or real estate? Comment below.