SEATTLE — In Seattle and around the country, the color of someone's skin can impact the value of their home.
In the Clark home, kitchen conversations sizzle in life lessons.
“Generational wealth is money, houses, or things you pass down,” said Jaxton Clark, 10, while helping his father prepare breakfast in their Columbia City home.
It’s been four years since the Clarks bought their house.
“The homes are selling for over a million dollars here,” said Joe Clark. “We bought this house kind of under -- it was under duress.”
The Clarks immediately began renovating to make space for their two children.
“We put in a new kitchen, new bathroom, an extra bathroom. And we have plans to expand the second floor,” said Clark.
But while the Clarks were building up, they were surprised to learn the value of their home had gone down according to a home appraiser, sent by their mortgage company in April.
The Clarks requested the appraisal as they considered financing options for their renovations.
“[The appraisal] came in very low, which was really unexpected. [My agent] asked me, ‘How was the appraisal?’ I said, ‘It came in really low.’ ‘Oh, because it was $800,000-$900,000?’ and I’m like, ‘No, no, it was in the sixes,’” said Clark.
The three-bedroom home was valued at $670,000 to be exact.
“It was quite amazing to have an appraisal that low in this market,” said Clark.
Earlier this year, Seattle real estate prices hit record highs, so Clark’s appraisal seemed questionably low. According to Zillow data, the typical home value in the Columbia City neighborhood this spring was over $900,000.
“I just want to make sure that we get the fair market value for the home,” said Clark.
The 'whitewashing' experiment
After the low appraisal, Clark decided to stage an experiment. He scheduled a second appraisal and asked his white neighbor Marta Eull to be his stand-in.
“The objective was to see if you had a person that was not someone of color in the house…if that would change the amount that he got for the appraisal to see if there was some kind of bias there,” said Eull.
Clark began the process of what he calls "whitewashing" his home by taking down his family photos and African art.
“Here’s a picture of my grandparents. Here’s a picture of my daughter at Christmas time. I took them down for the second appraisal,” he said.
And this time when the new appraiser came weeks later, they saw Eull’s white face instead of Clark's.
The second appraisal came back $259,000 higher than the first appraisal. The second appraiser valued the home at $929,000.
“We're talking a three-week period, and nothing else changed in the house outside of me,” said Clark.
“I was really happy that it came back and it was better for Joe, but I was mad that they had to go through that to get an appraisal that the rest of the neighborhood was at,” said Eull.
“It is a part of our systematic racism that is here in America but we need to do something about it. It’s taking away our generational wealth,” said Clark.
The differences between appraisals
KING 5 took a closer look at the differences between the two appraisals to figure out how the valuations could be so far apart.
Appraisals are largely based on what similar homes in the area have sold for. However, there aren’t clear guidelines on what criteria those comparable homes need to fit; it’s up to each individual appraiser to choose, which can be a problem.
“There's no set standard of what that is. So where [appraisers] draw those lines differ,” said Dr. Junia Howell, an urban sociologist and race scholar who studies home appraisal disparities across the country.
In Clark's first, low appraisal from April, to assess the value of the home, the appraiser chose "comparable" or similar homes that sold up to 2 miles away for $600,000 over the previous six months.
“They were like in Hillman City, somewhere in Rainier Beach as well. One was over by Genesee Park, which are all not part of this neighborhood of Columbia City,” said Clark.
This first appraisal also appeared to contain several errors, according to Clark. It did not take into account any of the renovations the Clarks had completed. Clark says the appraisal lasted less than 30 minutes, and the appraiser did not ask him many questions about the home or neighborhood.
Clark’s second appraisal, which was $259,000 higher than the first, in contrast, took much longer – roughly an hour and a half. The second appraiser also took into account that some homes nearby had sold for more than $1 million, including the home right across the street from Clark’s. Using that critical context to compare, the home was valued at $929,000.
“Am I surprised by this case? Well, I've seen a lot of them. I've seen a lot around the country. And I can show systematically that they're not an anomaly,” said Howell. “Homes in communities of color are worth 70% less, on average, when holding everything else constant as homes in white neighborhoods. It's really insane.”
That disparity adds up. A recent study by the Brookings Institute found appraisal differences amounted to roughly $48,000 per home or $156 billion cumulatively in majority Black neighborhoods.
“It is something that is going to affect [my children]," Clark said. "Because our Black and brown families homes are often devalued. They're often taken away from us.”
Bias rooted in the appraisal industry
The Clarks are navigating a system that is deeply rooted in documented racist rhetoric going back nearly 100 years. Howell explained how racist ideology from the 1920s made it into the then-budding appraisal industry.
“In the 1920s, the kind of new, at the time, Real Estate Association group started working with professors to systematize, and basically make their profession look more professional. But those that they were calling on were people who were trained by, and in other writings, pulled on social Darwinism and eugenics ideas that white communities were superior and making sure it continued to be the case by keeping out people who they thought didn't belong in those white communities,” said Howell.
Appraisal manuals from the 1930s to the 1970s perpetuated the belief that race was linked to value. One appraisal manual from 1946 ranked, in their words, “Negros and Mexicans" at the bottom of a list of who brings value to a neighborhood. At the top? White Europeans.
“That's racist, and historically, deeply problematic. And contemporarily, [it is] affecting real people's lives in ways that we can collectively push against and say we want and we demand better,” said Howell.
Such discrimination became illegal under the Fair Housing Act of 1968. But while the manuals may have changed, the diversity of the people determining home values hasn’t. According to the U.S. Department of Labor, 96.5% of appraisers are white and 70% of them are men.
“There are many initiatives to change the requirements to be a certified appraiser. There are many initiatives to try to recruit and train other people. So this is something that is being worked on,” said Howell.
Home value linked to generational wealth
According to the Brookings Institute, the net worth of a typical white family is nearly 10 times greater than that of a Black family. The racial gap exists in every income group except the lowest economic levels, where the median net worth is zero for everyone.
“These large disparities are creating generational wealth gaps [like] what kind of capital people have to take out of their houses to send their kids to school, or to kind of weather situations of health disaster or health crises in their families," Howell said. "There's so many things that home value matters for in our country because of how we've centralized it. And it has all these detrimental effects when you don't have that.”
“We're fighting for the next generation,” said Clark. “I'm doing all this for my kids so that they can have a better life.”
For Clark that means not worrying if the color of his skin will impact the value of what he can pass down to his kids.
“He wants me to be successful in life... not have to struggle, struggle in life or minimize those struggles... as a Black man in America,” said Jaxton.
“I’m always surprised by the things he knows,” said Clark. "I'm really proud of him. I'm impressed that he's paying attention.”
Several states, as well as Congress, have recently begun to consider legislation to address appraisal disparities. However, not yet in Washington.
For people who have received a suspiciously low home appraisal that they believe may be biased, they can file a complaint or get help here: