Valuation Bias and Fair Housing Laws and Regulations

Learning Objectives

• Highlight areas where real estate appraisers can improve their practice and avoid violating fair housing and other anti-discrimination laws.
• Help appraisers who have complaints filed against them understand how the process works, who to trust, and what to do. Most people have limited knowledge regarding the process of a civil rights complaint.
• Guide appraisers as they develop procedures to prevent mistakes in their reports that could lead to a civil rights complaint.

Program Overview:

Introduction (8 minutes)

Module 1: Understanding Valuation Bias and Fair Housing Laws (45 minutes)
• Module Introduction
• AQB Requirements for Continuing and Qualifying Education
• AQB Required Outline
• Real Estate Bias and Defining Protected Classes
• Note to Participants
• Focus of the Material
• Is This Going to Be a Psychology Course?
• Is This Going to Be an Ethics Course?
• Hindsight Is 20/20
• Blame Who?
• Anecdotal Evidence
• Be Careful What You Say (and Especially What You Write)
• Discussion 1: A Complaint Is Filed
• Media Coverage of Alleged Discrimination
• HUD’s Fair Housing Complaint Process
• Federal Fair Housing and Antidiscrimination Laws and Regulations
• The Power of Federal Agencies
• Who to Trust: The Adversarial Justice System
• Two Attorneys
• Discussion 2: Mental Anguish
• Axon Enterprise, Inc. v. Federal Trade Commission
• Module Conclusion
• Review Quiz
 

Module 2: Understanding Important Terms (55 minutes)
• Module Introduction
• Defining Terms
• Let’s Think About Relevant Definitions
• Defining Narcissism
• Let’s Think About a Fair Housing Complaint
• Defining Prejudice
• Let’s Think About Prejudice
• Defining Bias
• Discussion 3: Influences on Appraisers
• Let’s Think About Policing and Bias
• Let’s Think About Homebuyers and Bias
• Let’s Think About Potential Bias in an Appraisal
• Biases: Good and Bad
• Let’s Think About Biases Regarding Age
• Let’s Think About Another Case of Alleged Bias
• Defining Bigotry
• Let’s Think About Alleged Racial Bias
• Gender vs. Sex
• Bias vs. Stereotyping
• Let’s Think About Human Behavior
• Defining Discrimination
• Discussion 4: Considering a Mistaken Email
• Discussion 4: Our Take
• Discrimination vs. Affirmative Action
• Will Affirmative Action End Soon?
• Discussion 5: Moral and Ethical Dilemmas
• Discussion 5: Our Take
• Blockbusting
• Steering
• Let’s Think About Discrimination by Brokers
• Insurance Companies and Agents
• Module 2 Review
• Review Quiz

Module 3: Understanding Lending Policies and Civil Rights (60 minutes)
• Module Introduction
• Real Estate Appraisers and Age/Life Theory
• Overly Optimistic or Conservative Appraisals
• Let’s Think About Overly Optimistic Appraisals
• Overly Conservative Appraisals
• Discussion 6: Overly Optimistic or Conservative Appraisals
• Discussion 6: Our Take
• Predatory Lending
• Predatory Lending: Who Is to Blame?
• Let’s Think About Predatory Lending and a Residential Appraisal
• Government-Sponsored Enterprises
• Fannie Mae and Freddie Mac
• Federal Agency Redlining
• Redlining: Perspectives to Consider
• Restrictive Covenants
• Constitutional References
• Constitutional References, continued
• Constitutional References to Slavery
• Contemporary Context
• Discussion 7: Contemporary Context
• Economic Impact of Property Value Disparities for Protected Classes
• Gentrification
• Downsides of Gentrification
• Another Look at Property Value Disparities
• Shifting Perspectives of Gentrification
• Discussion 8: Public Conversations Regarding Valuation Bias
• Court Rulings and Developments
• SCOTUS Ruling in 1857: Dred Scott v. Sanford
• How Was Lincoln Elected in a Divided Country in 1860?
• Electoral Votes in 1860 and 1864
• Module 3 Review
• Review Quiz

Module 4: Understanding the Effects of Supreme Court Decisions (60 minutes)
• Module Introduction
• Court Rulings
• 1896: Plessy v. Ferguson
• 1917: Buchanan v. Warley
• 1938: Missouri ex rel. Gaines v. Canada
• 1948: Shelley v. Kraemer
• 1950: Sweatt v. Painter
• 1950: McLaurin v. Oklahoma State Regents
• 1954: Brown v. Board of Education
• 1968: Jones v. Alfred H. Mayer Co.
• 1968: Green v. County School Board of New Kent County
• 1971: Swann v. Charlotte-Mecklenburg Board of Education
• 1971: Griggs v. Duke Power Co.
• 1974: Milliken v. Bradley
• 1976: General Electric Co. v. Gilbert
• 1977: Village of Alington Heights v. Metropolitan Housing Development Corp.
• 1986: Wygant v. Jackson Board of Education
• 1986: Bowers v. Hardwick
• Bowers v. Hardwick and “Stare Decisis”
• 1991: UAW v. Johnson Controls
• 1993: Hazen Paper Co. v. Biggins
• 1996: Romer v. Evans
• 1998: Bragdon v. Abbott
• 2000: Boy Scouts of America v. Dale
• 2015: Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc.
• Supreme Court Composition
• Cases in Front of the Supreme Court in 2025
• Contemporary Context: NAR Report
• Insurance Rates for Homeowners
• Insurance Rates for Homeowners, Example
• Let’s Think About Homeownership and Wealth Accumulation
• Excerpts from the "2024 Profile of Home Buyers and Sellers"
• Economic Impact of Property Value Disparities for Protected Classes
• Discussion 9: Questions of Bias in an Appraisal
• Discussion 9: Our Take
• Discussion 10: Another Residential Appraisal Scenario
• Discussion 10: Our Take
• Public Conversation Regarding Valuation Bias: Recent Cases and Developments
• Module 4 Review
• Review Quiz

Module 5: Understanding Constitutional Amendments and Important Legislation (65 minutes)
• Module Introduction
• The 13th Amendment to the U.S. Constitution
• Freedom for Former Slaves Was Not the End
• The 14th Amendment to the U.S. Constitution
• The Emancipation Proclamation
• The 15th Amendment to the U.S. Constitution
• The 19th Amendment to the U.S. Constitution
• The Civil Rights Act of 1866: Context
• The Civil Rights Act of 1866: Focus
• The Civil Rights Act of 1866: Sections 1 and 2
• The Civil Rights Act of 1866: Section 3
• The Civil Rights Act of 1866: Section 4
• The Civil Rights Act of 1866: Section 5
• The Civil Rights Act of 1866: Section 6
• The Civil Rights Act of 1866: Section 7
• The Civil Rights Act of 1866: Sections 8, 9, and 10
• The Civil Rights Act of 1866: Codified
• Equal Credit Opportunity Act (ECOA) of 1974
• The Appraiser Regulatory System
• Financial Institutions Reform, Recovery, and Enforcement Act of 1989
• Banking and Stocks in the 1930s
• FIRREA Background
• FIRREA Creation
• FIRREA and Appraisers
• 1914: Unfair and Deceptive Acts and Practices (UDAP)
• 2010: Unfair, Deceptive, or Abusive Acts or Practices (UDAAP)
• Key Legal Concepts
• Defining Disparate Treatment
• Discussion 11: Disparate Treatment by Real Estate Appraisers
• Discussion 11: Our Take
• Discussion 12: Disparate Treatment by Real Estate Appraisers, continued
• Discussion 12: Our Take
• Discussion 13: Disparate Treatment by Real Estate Appraisers, continued
• Discussion 13: Our Take
• Disparate Treatment by Real Estate Appraisers: Resident Occupants
• Disparate Impact
• Definition: Disparate Impact
• Supreme Court Ruling in 2009: Ricci v. DeStefano
• Supreme Court Justices Who Ruled in Ricci v. DeStefano
• Supreme Court Composition
• Module 5 Review
• Review Quiz
 

Module 6: Understanding Bias and Best Practices for Appraisers (35 minutes)
• Module Introduction
• Breaking Down “Explicit Bias”
• Breaking Down “Explicit Bias,” continued
• Explicit Bias as a Component of Valuation Bias
• Discussion 14: Valuation Bias
• Breaking Down “Implicit Bias”
• Examples of Implicit Bias in Appraisals
• Breaking Down “Structural Bias”
• What Are the Major Economic Systems Found on Earth Today?
• Definitions of Economic Systems
• Economic Systems and Potential Structural Bias
• Is Capitalism a Biased System?
• Is the Appraisal System Biased Against Certain People?
• Discussion 15: A Closer Look at the Sales Comparison Approach
• Let's Think About Whether Current Systems of Marketing Real Estate Could Be Biased Against Protected Classes
• Do Your Appraisal Reports Read Like a Broker Wrote Them?
• Let’s Think More About Capitalism and Structural Bias
• Recognizing and Avoiding Valuation Bias
• Some Areas of Focus
• Let’s Think About the Status Quo Bias
• Module 6 Review
• Review Quiz
 

Module 7: Understanding GSE Requirements to Avoid Valuation Bias (45 minutes)
• Module Introduction
• Current Valuation Bias Topics: The FHFA and the Fannie Mae-Freddie Mac Report
• Let’s Think About the FHFA and the Fannie Mae-Freddie Mac Report
• References to Race and Ethnicity in Residential Appraisal Reports
• Let’s Think About a Residential Appraisal Scenario
• Freddie Mac Selling Guide
• Fannie Mae Selling Guide
• Discussion 16: Consequences for a Fair Housing Complaint
• Let’s Think About an Urban Appraisal
• Discussion 17: How Can Appraisers Protect Themselves?
• Discussion 17: Our Take
• Best Practices for Avoiding Valuation Bias
• Let’s Think About a Non-Residential Appraisal Report
• Discussion 18: Another Residential Appraisal
• Discussion 18: Our Take
• Discussion 19: A Rural Appraisal
• Discussion 19: Our Take
• Let’s Think About an Appraisal Report Developed with the Cost Approach
• Discussion 20: Reconciling a Value Opinion
• Discussion 20: Our Take
• Module 7 Review
• Review Quiz
 

Conclusion (12 minutes)
 

Additional Information:

Online Course Access

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Requirements:

Online education system requirements

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