Last week, Gov. Newsom signed 27 new bills to increase affordable housing supply and strengthen accountability for professionals who work in and around the real estate industry. Together, the suite of bills aims to bring transparency and accountability, including the creation of a new enforcement unit within state government.
California’s AB 948, sponsored by Assemblymember Chris Holden, will require real estate appraisers to complete qualifying and continuing education in cultural competencies and the elimination of bias.
The bill also requires that sales contracts and loan documents emphasize that any appraisal must be unbiased and not influenced by improper illegal considerations. Appraisal Institute’s California Government Relations Subcommittee worked collectively with the Legislature in support of this bill, and we applaud Gov. Newsom’s signature.
Black and Brown communities have been historically underrepresented as homeowners – not just in California, but across the entire United States. Unconscious bias is human and no profession is immune, including the appraisal profession.
While many stakeholders have a responsibility to do what is right, and it will take ongoing work, AB 948 is a strong step toward effecting change. Recognizing the need for greater awareness on these important topics, the Appraisal Institute is launching a 5-hour course that will cover unconscious bias.
Professional appraiser organizations like ours are also working alongside consumer groups, real estate brokers and agents, banks, government agencies, think tanks and others to better understand where current-day housing inequities stem from and what can be done to combat them.
We have partnered on the Appraiser Diversity Initiative with Fannie Mae, Freddie Mac and the National Urban League since 2019 to attract new entrants to the appraiser field, overcome barriers to entry (such as education, training, and experience requirements,) and to foster diversity in the appraisal profession.
The Appraisal Institute’s Education and Relief Foundation has committed $150,000 to the Initiative, which will be used to cover the entry level courses and professional resources for diverse aspiring appraisers. There are eight current sponsor organizations in total, including JP Morgan Chase which recently committed $3 million over three years.
Appraisers are neighbors living in the same communities in which we work, both in California and across the U.S. That’s why we are also working internally to spearhead initiatives and participate in the broader effort to create change.
This means backing broader solutions at the state and federal level that advance equity, looking at our own internal processes and approaches, recruiting more appraisers of color and women, ensuring consumers know their rights, and reinforcing ethics, education and training.
The Appraisal Institute consists of nearly 17,000 professionals who represent a cross-section of America. The profession does have a lot of work to do to achieve greater racial, ethnic and cultural diversity among appraisers, and representation is a leading force for equity and inclusion in every profession. We recognize that recruiting for greater diversity will make us stronger and more representative of the communities we work in and contribute to greater cultural awareness.
We have all read stories where people of color felt as though their race played a role in how their property was appraised. This is simply unacceptable. Appraisers take pride in being an objective source of real estate value information, and unfairly treating any individual goes against everything we stand for as a profession.
The conversations happening in this country are critically important and necessary for challenging and finding solutions to inequities and discrimination faced by communities of color.
The Appraisal Institute commits to continuing to participate in these conversations. Our Designated Members will continue to embody the gold standard as professionals. We are proud to have worked closely with Assemblyman Chris Holden on AB 948 to ensure unconscious bias education is state law.
This is just the beginning, and we will continue to lead in the work that must be done.
Editor’s Note: Rodman Schley is the 2021 head of the Appraisal Institute.