A black couple say their house was valued at a price £345,000 ($493,000) more when a white friend pretended she owned it.
Paul Austin and Tenisha Tate Austin bought their home in Marin City, California, from another black family in 2016 before giving the property a £287,000 ($400,000) makeover.
The huge revamp included adding an entire floor to the house, which brought an extra 1,000 feet of space, new flooring, new appliances and a fireplace.
However despite all their work, and expense, when an estate agent valued the property they suspected she had undervalued it at because they were black, ABC7 reports.
Despite all their work, when it came to appraising the value of the house, they believe they were given a low valuation of £710,000 ($989,000) which is around £72,000 ($100,000) more than what they paid for it because of their race.
Tenisha said: “I read the appraisal. I looked at the number – I was like, ‘This is unbelievable.'”
The couple said the estate agent was an older white woman who used coded phrases like ‘Marin City is a distinct area’ when she valued the property which they believe was race-related.
So they decided to run an experiment to see if their suspicions were right.
The couple asked a white friend to pretend she owned the house and after replacing the couple’s family photos throughout the house with her pals they called in an estate agent again.
Paul said: “We had a conversation with one of our white friends, and she said, ‘No problem. I’ll be Tenisha. I’ll bring over some pictures of my family.’
“She made our home look like it belonged to her.”
This time the house was valued at $1,482,000 (£1.05million) – around 50 percent more.
Tenisha said: “There are implications to our ability to create generational wealth or passing things on if our houses appraise for 50 percent less.”
Jessica Lautz, the National Association of Realtors’ vice president of demographics and behavioural insights, said the couple’s case was not unusual.
“We know discrimination is in nearly every aspect of that home buying process,” she said.
“We need to be addressing it as an industry.”
Last August, The New York Times reported that a mixed-race couple found that the value of their home shot up by 40 per cent when all signs of black ownership were removed.
Family photos were removed and replaced with a series of oil paintings by the white owner and and his grandparents.
They even removed books by black authors Zora Neale Hurston and Toni Morrison off bookshelves and left holiday photo cards showing white friends on display.