New analysis finds evidence of racial bias in Philadelphia home appraisals

Researchers analyzed valuations completed for home purchases and applications to refinance.

Federal data shows that racial bias remains a potential roadblock for homebuyers and homeowners in Philadelphia’s predominately Black neighborhoods, according to new research from the Reinvestment Fund.

The report, released Thursday, focuses on home appraisals. It found that independent valuations completed in those communities were more likely to be lower than the property’s market value, making it harder for buyers to secure mortgage loans, as well as for homeowners to pull equity out of their properties.

“This is not just saying that properties in Black neighborhoods are less valuable than the properties in white neighborhoods,” said Ira Goldstein, senior advisor of policy solutions at the Reinvestment Fund. “It implies that there is some measure of bias in either the individual appraisals, or in some of the appraisal methodology, or a variety of other settings.”