CHICAGO—Leaders, activists, and community members converged in the South Loop for the Chicago Urban League’s “Policy Summit State of Black Chicago Solutions” on May 17. The goal: to tackle urgent issues and devise actionable solutions to uplift Black Chicagoans.
The summit zeroed in on wealth building through homeownership and family-supporting careers. Executives from PNC Bank, Nexamp, and Fifth Third shared their efforts to create more opportunities for Black Chicagoans and other underserved communities.
Central to the discussions was the Chicago Urban League’s Appraisal Bias Task Force, which emphasized the critical need to educate consumers about the home appraisal process and enhance diversity and cultural proficiency within the real estate appraisal industry.
These steps are vital to breaking down barriers that hinder Black wealth building through homeownership. These insights were shared with nearly 300 business professionals, civic leaders, and community members gathered at the Marriott Marquis Chicago.
Themed “The State of Black Chicago: Solutions,” the policy summit focused on addressing the economic disparities highlighted in the Chicago Urban League’s 2023 State of Black Chicago report, released last June.
“We know from our 2023 report and previous reports that Chicago’s Black residents have the lowest household income, the highest levels of poverty and unemployment, and a far greater likelihood to be burdened by rent payments than the city’s other residents,” stated Karen Freeman-Wilson, President and CEO of the Chicago Urban League. “What’s important is to talk about solutions. How can we all work together to erase economic disparities?”
Black homeowners frequently find their properties significantly undervalued compared to others in the city—a disparity that has worsened over time. The report highlighted a stark increase in the racial gap in home values in the Chicago area, which rose from $50,000 in 1980 to a staggering $325,000 in 2020.
Racially biased home appraisals have captured national attention in recent years, with numerous reports highlighting stark disparities in home valuations for Black homeowners compared to their White counterparts. Investigations in cities such as Baltimore, where a Black couple saw their home value soar after they had a White friend stand in for them during an appraisal, and San Francisco,
Where a Black family experienced a similar situation, have underscored the pervasive nature of appraisal bias. Additionally, reports from Indianapolis and Jacksonville have revealed significant undervaluation of Black-owned properties, fueling widespread calls for systemic reform in the real estate appraisal industry.
The Chicago Urban League established the Appraisal Bias Task Force in response to these alarming statistics. Comprising of appraisers, public officials, bankers, mortgage lenders, realtors, realtists
(a licensed real estate agent who is a member of the National Association of Real Estate Brokers), researchers, and nonprofit professionals, the task force has been meeting since November 2023 to develop policy recommendations to tackle the undervaluation of Black-owned properties. Although the full report is expected by the end of 2024, six preliminary observations were shared during the summit:
Appraisal bias is a symptom of the broader issue of homeownership for Black Chicagoans;
The root causes of racial disparities in homeownership—such as historic segregation and redlining—require complex analysis;
Addressing the racial disparity in homeownership necessitates a multi-industry approach;
Enhancing diversity and cultural proficiency in the appraisal industry would boost confidence in the appraisal process;
Many consumers do not understand the appraisal process, leading to assumptions of discrimination when mistakes may be the cause;
And, the process for appealing erroneous appraisals is challenging and could benefit from a more consumer-friendly approach driven by community and industry collaboration.
This is why the Urban League continues to matter, explained Pamela Stalling, Vice President of Housing & Financial Empowerment for the Chicago Urban League.
“We ensure every day that our clients are equipped to get the best financial practices to ensure their road to credit health, homeownership, business ownership and overall financial success,” she said at the beginning of a panel she moderated that included, Lutalo McGee, ChairReal Estate Broker and owner of Ani World LLC, and William Hendrix-Griffin, Senior Vice President, Affordable Lending at PNC Bank.
“We engage in this work against the backdrop of equity theft that has occurred through government-sanctioned redlining, land contracts, and other predatory practices,” she said.
“We have to invest in our disinvested communities. We have to make that a priority,” said Tracey Scott, CEO of Chicago Housing Authority, acknowledging that city government has a role to play. “That’s the only way we will move forward, especially for Black families in Chicago.”
Although the speakers addressed many questions during the event, time constraints left some queries unanswered. In the coming weeks, the Chicago Urban League will host a Facebook and LinkedIn Live event to tackle these outstanding questions and delve deeper into potential solutions.
For more details and information about the task force, and the State of Black Chicago 2023 report, visit www.chiul.org.
