Publication Type: Conference Paper/Unpublished Manuscript
Review Method: Peer Reviewed
Abstract: The professional opinions of real estate appraisers are required to underwrite mortgages, assess taxes, and maintain liquidity in property markets. The profession acts as gatekeepers to value, and since the 1930s has sought to establish its appraisal methodologies as stable and legitimate. This has been no small feat as the radical heterogeneity of the buildings and places confounds attempts to standardize the derivation of property values.

The law has mediated numerous challenges to the industry’s claims of expert knowledge. The best-known has been accusations of institutionalized racial bias, which is not surprising given that until 1977, the industry relied on racial rankings developed by University of Chicago economist, Homer Hoyt. The Justice Department had to sue appraisers and lenders to discontinue this practice. Less obvious challenges include attempts by professional lacking specialized credentials, notably real estate brokers, to engage in similar practices. More stringent professional codes and education standards have been devised to protect the industry’s claims to specialization and expertise.

This paper examines the historical role of the law in establishing and challenging appraiser’s claims to expert knowledge. Courts judge the admissibility of expert scientific, technical or specialized evidence according to standards set by precedent. While the possession of specialized technical knowledge may be considered a lower threshold to traverse than that for scientific knowledge, the nature of such knowledge in nonetheless contested as judges take on the odious task of trying to separate fact from value. In the process, the inconsistencies, inaccuracies, and ambiguities embedded in the established appraisal methodologies are exposed and the very notion of value challenged.