Fair Housing

A real estate appraiser in Indiana who bases value adjustments on the racial or ethnic composition of a neighborhood is engaged in:

ALegitimate market analysis
BIllegal appraisal bias — racial composition cannot be a factor in valuation✓ Correct
CStandard USPAP practice
DRequired demographic analysis

Explanation

Using racial or ethnic composition of a neighborhood as a factor in appraisal is illegal under the Fair Housing Act and a violation of USPAP. Appraisers must base adjustments on property characteristics and market data, not on protected characteristics.

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