Warren Joins Klobuchar, Warnock, Cleaver, Colleagues to Urge Federal Financial Institutions Examination Council to Address Racial Disparities in Housing Appraisal Industry
Washington, D.C. – United States Senator Elizabeth Warren (D-Mass.) joined Senators Amy Klobuchar (D-Minn.) and Raphael Warnock (D-Ga.) and Representative Emanuel Cleaver, II (D-Mo.), along with more than 30 of their colleagues, in a letter urging the Federal Financial Institutions Examination Council (FFIEC) to work with the housing appraisal industry to address disparities in home valuations for communities of color.
Recent reports have shown significant disparities in the assessments of home valuations for white families and families of color -- in fact, a 2018 Brookings Institute report found that homes in majority-black neighborhoods are valued at roughly half the price as homes in neighborhoods with no black residents. Furthermore, the Appraisal Institute recently acknowledged the need to address unconscious racial bias in home valuations.
There remain significant disparities in homeownership rates between white families and families of color. Years of discriminatory policies—such as segregation, limited access to federally-backed mortgages, and restrictive neighborhood covenants—have created significant barriers to homeownership for families of color. These structural factors continue to exist today, where there is now an estimated 50-year high in the gap between black and white homeownership rates, as well as persistent gaps for Asian, Hispanic, and Native households.
In the letter, the legislators highlight data on racial disparities in home appraisals, the connection between home values and intergenerational wealth, and the significant gap in black and white homeownership rates, concluding:
“Given the critical connection between homeownership and wealth, as well as the longstanding structural barriers to homeownership for families of color, it is crucial that appraisers accurately and impartially assess the values of Americans’ homes. Therefore, we encourage FFIEC to work with appraisers to reduce the racial appraisal gap and to address the long-term undervaluation of neighborhoods of color,” wrote the lawmakers.
In addition to Senators Warren, Klobuchar, Warnock, and Cleaver, the letter was signed by Senators Edward J. Markley (D-Mass.), Tammy Baldwin (D-Wiss.), Ron Wyden (D-Ore.), Sheldon Whitehouse (D-R.I.), Chris Van Hollen (D-Md.), Richard Blumenthal (D-Conn.), Catherine Cortez Masto (D-Nev.), Tina Smith (D-Minn.), Kirsten Gillibrand (D-N.Y.), Cory Booker (D-N.J.), Dianne Feinstein (D-Calif.), Dick Durbin (D-Ill.), and Bernie Sanders (I-Vt.) and Representatives Eddie Bernice Johnson (D-Texas), Eleanor Holmes Norton (D-D.C.), Dwight Evans (D-Pa.), Bonnie Watson Coleman (D-N.J.), Donald Beyer (D-Va.), Sanford Bishop, Jr. (D-Ga.), Deborah Ross (D-N.C.), Cindy Axne (D-Ind.), Grace Meng (D-N.Y.), Bill Foster (D-Ill.), Jamaal Bowman (D-N.Y.), Bobby L. Rush (D-Ill.), Mondaire Jones (D-N.Y.), Alcee Hastings (D-Fla.), Peter Welch (D-Vt.), André Carson (D-Ind.), Jesús G. “Chuy” García (D-Ill.), Thomas Suozzi (D-N.Y.), Alma Adams (D-N.C.), Kweisi Mfume (D-Md.), and Carolyn Maloney (D-N.Y.).
This letter is part of Senator Warren's ongoing efforts to address racial disparities in the housing market:
- In March 2021, Senators Warren and Cory Booker (D-N.J.) requested information from the Consumer Financial Protection Bureau (CFPB) about its oversight authority and regulatory history as it relates to preventing tenant screening technologies from hurting tenants of color.
- In March 2021, Senator Warren reintroduced the Public Housing Emergency Response Act to address the estimated $70 billion backlog of maintenance and repairs in public housing and ensure our nation’s public housing is healthy and safe.
- In March 2019, Senator Warren and colleagues reintroduced the American Housing and Economic Mobility Act to help bring down costs for renters and buyers, level the playing field so working families everywhere can find a decent place to live at a decent price, and takes the first step to address the effects of decades of housing discrimination on communities of color.
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