A More Equitable Housing Market Starts with Objective Appraisals

The recent guidance from Freddie Mac around unacceptable appraisal practices highlights an important issue - the need for objective and unbiased language in property valuations. As the article explains, many common descriptors used in appraisals like “prestigious,” “family-friendly,” or “desirable” reflect subjective opinions or unintentional biases of the appraiser.

This subjective language raises concerns about fairness and transparency in the home valuation process. When appraisals include judgments about what kinds of residents a neighborhood or home is best suited for, it can lead to inequitable treatment for certain borrowers and communities.

Instead, appraisals must focus solely on factual data like recent sales, construction features, and quantifiable neighborhood attributes. As the article rightly suggests, appraisers should avoid assumptions about purchasers and stick to objective measurements when developing valuations.

Of course, appraisers themselves likely do not intend harm when using casual language like “strong market.” But regardless of intent, characterizations that go beyond facts open the door to bias. Even subtle linguistic biases risk creating unfair lending barriers.

That’s why strict standards around appraisal objectivity are so important. Guidelines like Freddie Mac’s help reinforce that valuations must be based on impartial data, not subjective phrases prone to misinterpretation.

Eliminating language that could be construed as biased ensures a fair housing finance system. With clear expectations set, the industry can make progress toward appraisals that equitably serve all homebuyers and communities. After all, achieving the American dream of homeownership should have nothing to do with subjective notions of “desirability.”