In one of his first acts as President, Donald Trump has repealed numerous Biden administration diversity, equity, and inclusion (DEI) executive orders. Especially for the Property Appraisal and Valuation Equity (PAVE) Task Force, this reversal could not have come soon enough.
President Biden’s housing DEI push was largely inspired by a 2018 Brookings Institution study titled “The Devaluation of Assets in Black Neighborhoods.” This study claimed that homes in majority-Black neighborhoods were undervalued by 23% — equating to $156 billion in cumulative losses. Brookings attributed the entire valuation gap to racial discrimination.
Our more robust research demonstrates that socioeconomic status (SES) or class factors, such as income, educational attainment, marriage rates, and wealth, can explain virtually all of these disparities. For example, even in entirely white neighborhoods, where racial bias cannot be a factor, large valuation gaps persist when sorted by factors such as educational attainment, single-parent household rates, food stamp usage, median income, or credit scores. While SES disparities between the average white and black household reflect the legacy of past discrimination, they are not exclusively racial, as evidenced by white communities facing similar challenges. Vice President J.D. Vance, whose humble upbringing he vividly details in his book Hillbilly Elegy, embodies the struggles faced by low-income households across racial lines.
The Brookings study did not explicitly assign blame for the valuation differences it highlighted, but PAVE swiftly directed its focus on appraisers—a group that is predominantly white, male, and older—portraying them as a central source of systemic bias. Despite multiple efforts by us and others to present research that challenged Brooking’s and similar findings, PAVE dismissed these contributions, choosing instead to reinforce its preconceived notion.
While the appraisal industry has belatedly recognized the need to diversify its workforce, PAVE’s approach has inadvertently eroded trust in both the housing market and the valuation process. At one point, Democratic lawmakers even entertained the idea of creating a federal entity to set home prices by fiat—a proposal fraught with the potential for catastrophic consequences. Adding to the unease, some appraisers have faced lawsuits based on flimsy evidence, further undermining the credibility of an already fragile system. Meanwhile, the government is increasingly sidelining appraisers in favor of questionable automated valuation models developed by Fannie Mae and Freddie Mac—models that not only lack transparency, but are also vulnerable to manipulation, posing significant risks to the integrity of the housing market.
PAVE’s policy recommendations, rooted in faulty analysis that ignored critical SES factors, were misguided from the start. By drawing the wrong conclusions, PAVE’s solutions were doomed to be, at best, ineffective, and at worst, detrimental to the very equity goals it sought to achieve.
President Trump is right to reverse the Biden administration’s misguided policies. In his second inaugural address, he spoke of restoring common sense to federal governance and achieving Dr. Martin Luther King Jr.’s vision of a colorblind society — one where individuals are judged by the content of their character, not the color of their skin. Repealing these divisive policies is a necessary and crucial first step, but much more work lies ahead.
To narrow income and wealth gaps, the Trump administration needs to implement tax, immigration, and regulatory reforms to foster a thriving economy that benefits lower-skilled workers, as was achieved during Trump’s first term. It also needs to encourage, rather than penalize, two-parent households, recognizing the stabilizing and economic benefits they provide for children and communities. It should also champion school choice at the state and local levels and hold teachers’ unions accountable for their role in perpetuating systemic failures, which disproportionately harm children from lower-income and minority families.
To expand homeownership opportunities for more Americans, the President should build on his executive order directing federal agencies to reduce construction costs and regulatory barriers. Specifically, he should instruct the Secretary of the Interior to auction off federal Bureau of Land Management (BLM) land for private market-rate development.
This initiative has the potential to add 5–8 million new homes over the next decade, addressing much of the housing supply crisis while simultaneously generating an estimated $100 billion in land sale revenue to federal coffers. These funds could be strategically reinvested in tax cuts, further fueling economic growth and financial opportunities for American families.
Voters, especially minorities, intuitively understand the importance of opportunity over divisive rhetoric preached by cultural elites. They seek an equal shot at the American Dream, not an equal outcome. By rejecting the failed approaches of the past and implementing practical, market-driven reforms, the Trump administration can address the real drivers of inequality and pave the way for lasting economic and social progress.
Tobias Peter and Edward Pinto are co-directors of the AEI Housing Center.
This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.
To contact the editor responsible for this piece: zeb@hwmedia.com.
