Black couple settle lawsuit against realtors who valued their home $500,000 below market rate
A black Bay Area couple settled a lawsuit with the appraisal company that valued their home at just $945,000 when it was really worth $1.5 million, a fact the couple only discovered when they got a white friend to introduce themselves. to do as the owner.
The secret settlement win for Paul and Tenisha Tate Austin includes compensation from Janette Miller, the appraiser, and her company, Miller and Perotti Real Estate Appraisers, who in 2020 had two different employees appraise the Marin City home within weeks of each other.
In addition to the money, Miller must agree to watch a documentary about the Austin family’s case entitled Our America: Lowballed. She will also follow a training course on how to prevent housing discrimination.
Fair Housing Advocates of Northern California were also named in the lawsuit against co-plaintiffs. The group’s executive director, Caroline Peattie, said so the San Jose Mercury news that the decision to settle was made because of the toll a long court case can take on a family.
“Obviously we felt we had a strong case or we wouldn’t have been aiming for it in the first place. Filing a lawsuit based on evidence is one thing and how a judge will rule is another. You are never sure of a certain outcome. I think everyone involved in the case was ready to move on,” Peattie said.
Tenisha Tate-Austin and her husband Paul Austin said they were “happy” that the lawsuit was over
The couple sued appraiser Janette Miller, pictured, her firm of Miller and Perotti Real Estate Appraisers, Inc over the low grade the couple first received
Paul Austin said in a statement that the family was “happy” to put the lawsuit behind them and described the experience of being so low as “overwhelming,” according to Mercury News.
While his wife, Tenisha Tate-Austin, said, “The continued undervaluation of homes in black neighborhoods perpetuates the wealth gap between black and white families.
“We hope that by raising awareness of our case and this settlement, we can help change the way the valuation industry operates and we can see another trend,” she continued.
The Austin family bought their home in 2016 for $550,000.
Couple Paul and Tenisha said the first real estate agent to appraise the home was an elderly white woman — Miller — who used coded phrases like “Marin City is a separate area” when she appraised the property they believe was race-related, according to an interview they did ABC San Francisco in 2021.
When the couple’s white boyfriend, Jan, pictured, posed as the owner of their home, the value soared to $1,482,000 – nearly $500,000 more
The couple complained to their lender, describing it as ‘a slap in the face’ before the couple were finally cleared for a second appraisal.
This time, the pair decided to conduct an experiment to see if their suspicions were correct and had a white friend pose as the owner.
They hid photos and artwork and replaced them with their friends’ photos.
“We had a conversation with one of our white friends, and she said. ‘No problem. I will be Tenisha. I’ll bring some pictures of my family.” She made our house look like it belonged to her.’
“There are implications for our ability to create generational wealth or pass things on if our homes are valued 50 percent less,” Tenisha added.
The couple undertook $400,000 in major renovations in the five years since purchasing the home, including brand new flooring that added 1,000 square feet of space, a fireplace, new appliances, and an outdoor deck.
But when it came to listing the property, they found that the home’s value had increased by only 10 percent.
The couple bought their home in 2016 for about $890,000 but was valued at just $995,000 despite spending $400,000 on renovations
The couple undertook major renovations in the five years since they bought the home, including a brand new floor that added 1,000 square feet of space, a fireplace, new appliances, and an outdoor patio.
The couple then had a white friend post as owner and hid photos and artwork and replaced it with their friend’s photo
After a second appraisal, they were shocked to find that the home’s value had increased by another $500,000
The Austin family bought their home in 2016 for $550,000
“I read the appraisal, I looked at the number and I thought, ‘This is unbelievable,'” Paul told the ABC affiliate.
Paul believed the low grade was due to the color of their skin.
“I read the appraisal, I looked at the number, and I thought, ‘This is incredible.’ Paul said to the ABC affiliate.
“We’ve done our homework,” Austin told the Reparations Task Force in October at a panel on the racial wealth gap, as reported by the San Francisco Chronicle.
“We think the white lady wanted to devalue our property because we live in a black neighborhood and the house belonged to a black family.
“My stomach hurt, my head hurt, just from what we went through,” said Austin. ‘I don’t wish that on anyone.
‘I want to see change. I don’t want my kids to have to deal with this,” he added.
Marin City, where the Austins live, is a historically black community.
“There are definitely things about this complaint that are uniquely strong,” a lawyer for the couple, Julia Howard-Gibbon, told the Chronicle. “They essentially erased themselves from the house.”
Attorneys for the Austins note: “Marin City has a long history of undervaluation based on stereotypes, redlining, discriminatory standards of judgment, and actual or perceived racial demographics.”
Jessica Lautz, vice president for demographics and behavioral insights for the National Association of Realtors, said the couple’s case was not unusual.
“We know that discrimination occurs in almost every aspect of the home buying process,” she said. ‘We have to tackle it as an industry.’
Black home ownership is much less nationwide: Only 44 percent of Black Americans will own their homes by 2021, compared to 74 percent for white Americans according to a real estate company Redfin.
In the state of California, only 34 percent of black Californians own a home, according to the National Association of Realtors.