A Marin-based fair-housing nonprofit recently reached a settlement on behalf of an Oakland couple who claimed a home appraiser undervalued their property by nearly a quarter of its worth because of their race.
Fair Housing Advocates of Northern California (FHANC), a San Rafael-based agency which supports alleged victims of housing discrimination, and Ronald and Dominique Curtis in November settled a case for $90,000 with appraiser Mehdi Mehdipour-Mossafer. Filed with the California Civil Rights Department, the complaint detailed how the Curtises in December 2020 applied to refinance their home, which had been appraised the preceding April at $1.15 million. Ronald Curtis, who is black, and Dominique Curtis, who is Latina, had purchased the North Oakland property in 2019 and had since made “significant renovations,” according to FHANC.
But when they hoped to take advantage of the low interest rates offered at the close of 2020, the Curtises were “shocked,” as FHANC described, to receive a valuation from Mehdipour-Mossafer for $900,000—about $250,000 less than what they were expecting. Ronald Curtis, a real estate agent, and Dominique Curtis, herself an appraiser, believed racial bias was the reason for the low valuation, and the couple appealed. But Mehdipour-Mossafer wouldn’t change the appraisal—and the Curtises were unable to secure the refinance loan. “After this experience, the Curtises made the difficult decision to sell their home,” FHANC said in a statement following the settlement.
“In preparing their home for sale, they removed all their belongings, including family photos and other items indicating their race and ethnicity, and hired a real estate agency to stage their home with neutral furnishings and show it to potential buyers,” the statement continued.
In October 2021, the house sold for $1.2 million, nearly $300,000 more than Mehdipour-Mossafer’s valuation. Working with the Curtises, FHANC filed a complaint with the Civil Rights Department on behalf of the couple, seeking damages for the resources expended in investigating the claim and to counteract the effects of the alleged discrimination through its education and outreach efforts.
In a statement about the settlement, Julia Howard-Gibbon, FHANC’s supervising attorney, said that research shows appraisers contribute to the undervaluation of Black and Latinx neighborhoods in a variety of ways. In the case of the Curtises, the appraiser made four race-based errors: Considering a neighborhood’s racial and ethnic composition in their determination of the market area from which to choose comparable sales, allowing biased assumptions about the race or ethnicity of the homeowner to influence valuation; relying on the unfounded assumption that a typical buyer is white and that white people want to live in predominately white neighborhoods; and by valuing homes based on recent local sales, which recycles home values that were initially determined under racist appraisal criteria.
In addition to the $90,000 in the settlement, Mehdipour-Mossafer agreed to not engage in any form of unlawful discrimination in the appraisal of residential real estate, to participate in FHANC training regarding the history of segregation and housing discrimination in the Bay Area, and to abide by the Bureau of Real Estate Appraisers’ anti-bias education requirements.
In applauding the Curtises for pursuing the complaint, FHANC Director of Investigations Maria Callahan said the agency is “hopeful that this resolution will prevent others from having to face the same experience.”