A black couple from Marin City, California, sued an appraisal company for undervaluing their home close to a million dollars.
On Thursday, the Fair Housing Advocates of Northern California filed the lawsuit in U.S. District Court in San Francisco on behalf of Paul and Tenisha Tate-Austin. Paul made a statement regarding the appraisal company’s actions.
“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,” he said. “The sales comps that the appraiser chose to use were unsuitable and were guaranteed to lower the value of our house.”
The lawsuit also states that the defendants’ actions violated the California Fair Employment and Housing Act. This law was enacted in 1959 to protect individuals in housing and employment from discrimination based on race, religion, national origin, and ancestry.
“Few of these cases happen, but this has been going on for years,” Fair Housing Supervising Attorney Julia Howard-Gibbon told the Business Journal. “Appraisers seem to think they need to stick to the composition of neighborhoods.”
The couple purchased their home at $500,000 in December 2016. However, the lawsuit states that the couple spent $400,000 in home renovations over the next two years.
In 2020, the Austins got an appraisal for $995,000 by Janette Miller of Miller & Perotti appraisers during a refinance. The family thought the assessment was relatively low and decided to get a second opinion from another firm. To ensure that their home was undervalued because of their skin color, they taped their white friend, Jan, to pretend to be the homeowner when greeted by the appraisal company three weeks later. According to the Washington Post, the Austins removed every trace of African American culture in the home by taking down artwork and pictures to determine if the outcome would be different.
After making minor changes to the home’s appearance, the second company’s valuation was estimated at $1.48 million, which is the typical median home value is for a single-family home in Marin County.
This instance isn’t the first time black homeowners have faced discrimination in housing. The Washington Post reported similar situations black families have experienced across the country. “The value of a woman’s Indiana home more than doubled between appraisals last year after she stripped it of all evidence that a Black person owned it and a White family friend stood in as the homeowner. Earlier this year, a Black family in Ohio removed family photos, artwork, and their 6-year-old daughter’s superhero pictures, replacing them with belongings their White neighbors offered up. As a result, the appraised value of their house went from $465,000 to about $560,000.”
