A Black Indianapolis homeowner who had a nagging suspicion her house was low-valued during two appraisals in 2020 went to great lengths to conceal her race on a third. She removed photos of herself and her relatives and had a white friend pose as her brother for the appraiser’s home visit.
The result? Carlette Duffy’s appraised value more than doubled.
Duffy’s home, which was assessed by different companies in 2020, was first appraised at $125,000, then $110,000 and finally $259,000 in November, according to the Fair Housing Center of Central Indiana. The nonprofit announced this month that it had filed housing discrimination complaints on Duffy’s behalf with the U.S. Department of Housing and Urban Development.
Amy Nelson, executive director of the group representing Duffy, said it’s “heartbreaking” that the homeowner had to do so much to secure a fair appraisal.Carlette Duffy
“In order for the value of her home to be accurate, she had to remove herself completely from the home,” Nelson said Monday. “She was at first ecstatic that she did in fact get the value that she thought her home deserved. … But then almost immediately after, she was heartbroken with the fact of what she had to do in order to get that value.”
Duffy was trying to refinance her mortgage last year and took additional steps on her third appraisal to ensure better results, according to the Fair Housing Center. She did not declare her race or gender as part of the appraisal application process and limited her interactions with that appraiser to email, Nelson said.
The complaints allege discrimination against Duffy based on her “race” and “color.” They also argue that the lower valuations amount to violations of “Title VIII of the Civil Rights Act of 1968 as amended by the Fair Housing Act of 1988.”
The first complaint names Citywide Home Loans, its employee Craig Hodges and Jeffrey Pierce of Pierce Appraisal Inc. No one named in the complaint responded to requests for comment Monday. The complaint says Pierce visited Duffy’s home on or around March 31, 2020. The complaint says that Duffy’s home is in a historically African-American neighborhood and that Pierce was “purposely pulling comps for the appraisal that were not fair and were racially motivated.”
The second complaint names Andre Mammino and Doug Frimmet of Freedom Mortgage. Mammino and Frimmet could not be reached for comment. Freedom Mortgage did not immediatley respond to a request for comment. The complaint also named Timothy Boston with Appraisal Network. Boston, reached by phone Monday, declined comment. The complaint also named a third-party company SingleSource, which assigned Boston for the appraisal. Representatives with that company did not comment.
The complaint alleges on or about May 26, 2020, Boston conducted a home appraisal. Duffy later learned it valued her property at $110,000 with a cash-out value of $96,000. Duffy purchased her home three years earlier for $100,000. At the time of the first two appraisals, “home values were rising dramatically,” according to a statement from the Fair Housing Center. Duffy challenged the appraisals with market analysis data and was rebuffed both times, the nonprofit’s statement said.
Andre Perry, senior fellow with the Brookings Institution, a nonprofit public policy organization based in Washington, D.C., said housing discrimination against the Black community is a systemic problem plaguing the country. Perry co-authored the 2018 study “The devaluation of assets in Black neighborhoods.” It concluded homes in 2017 in predominantly Black neighborhoods were appraised 23 percent lower than similar homes in majority white neighborhoods. The loss in equity cost homeowners in Black neighborhoods $156 billion in 2017, said Perry, who also wrote the book “Know your price: Valuing Black Lives and Property in America’s Black Cities.”
He said Duffy’s experiences during the first two appraisals are not unique. “When a white person stands in for a Black owner, you’re literally seeing the intrinsic value of whiteness being played out,” Perry said. He said undervaluing homes in Black neighborhoods is stealing from homeowners.
“In real terms, that is someone’s college tuition. That is a business that should have been started. That is the resources to protect against the next pandemic,” he said. “You’re robbing people of opportunity.” Perry said there should be safeguards for homeowners to protect themselves from having their property appraised at less than market value.
“When an owner feels something is off, they should have another level of recourse to dispute the original appraisal. We need accountability systems,” he said. “If someone is off by a significant margin, they should lose their license.” Nelson, with the Housing Center of Central Indiana, said the appraisal industry has a diversity problem. “It’s overwhelmingly white males,” she said. “That is never good when there is a lack of diversity.”