Issues pertaining to fair housing have always been important. Day to day, week-to-week, month to month, real estate professionals across the country continually face challenges related to compliance with Fair Housing laws. In the past few months, however, the volume of fair housing “chatter” in the industry has reached a new high, with industry heavyweights NRT, NAR and others chiming in.
This past April, the National Fair Housing Alliance published a scathing report revealing what it claims is pervasive unequal treatment of African-American and Latino homebuyers. According to the study, which followed 145 “paired sales tests” in 73 sales offices in twelve metropolitan areas between 2003 and 2005, “almost 20 percent of the time, African-American and Latino testers were refused appointments or offered very limited service” in comparison with white testers. The NFHA study also found that:
o Minority home seekers were more likely that whites to be required to bring pre-approval letters from lenders before agents would show them homes;
o White home seekers were shown more homes than non-whites (8 homes per test compared to 5 homes per test);
o White testers were offered far more financial incentives such as closing cost reductions or lower mortgage fees when compared with minority buyers; and
o Schools were used to steer buyers along the racial or ethnic composition of neighborhoods.
Although the National Association of REALTORS®, reacting to the report, said that NAR did not have enough information about the report’s methodology to “say what the significance of the findings are” in terms of nationwide agent behavior, the Association clearly understands the importance of the issues on a national scale. This past week in
According to Janik, the volume of claims against real estate brokers relating to Fair Housing violations increased 8 percent last year compared to the year before. Thirty-eight percent of those cases involved charges of racial discrimination while forty percent were related to disabilities.
In response to the increased activity involving Fair Housing, both NAR and large brokerage firms are taking action. This year’s Code of Ethics was amended to further address fair housing issue, adding the following statement:
"When involved in the sale or lease of a residence, Realtors shall not volunteer information regarding the racial, religious or ethnic composition of any neighborhood nor shall they engage in any activity which may result in panic selling; however, Realtors may provide other demographic information.”
NRT, the nation’s largest brokerage, is also acting. The Firm has developed a Fair Housing Pledge that it says summarizes the “commitment (to fair housing) on the part of our sales people.” According to Judy Reeves, COO of NRT, Inc., the firm’s real estate professionals, “are taking four workshops and each will sign the Fair Housing Pledge when they are finished.” Reeves explained that the Fair Housing effort “is one component of our diversity initiative. Our country is becoming more diverse. Every Realtor goes through Fair Housing education as a requirement of membership, but it shouldn't be the boring thing you check off your list. Our ability to treat everyone fairly is the cornerstone of real estate."
The NRT effort is impressive. In partnership with the National Community Reinvestment Coalition (NCRC), the Firm is designing and developing fair housing training programs for more than 64,000 associates in over 1000 NRT offices across the country. According to sources familiar with the NRT initiative, a thorough review of NRT's fair housing policies and practices will be conducted to assist in implementing additional policies as appropriate, and compliance monitoring will be handled through self-tests and internal oversight. NAR also participated in the NRT program, working on the workshop component with the Firm by supplying Fair Housing educational materials.
One of the reasons given by Reeves for the NRT initiative is, in truth, the reason all professionals need to recommit to Fair Housing observance and compliance: “The changing demographics and the challenges of diversity means that if we are going to be diverse and address the way we deal with the public, we must make it consistent."
The simple fact of the matter is that whether you practice in
Furthermore, professionals do not need the resources of an NRT office or even the national association – high value, high gain Fair Housing education programs are available, though thorough investigation of every option is important.
What’s most important today is to be proactive when it comes to Fair Housing issues and compliance. If you’re a broker, develop and put in place a program to ensure that your office and agents are empowered with the very latest in Fair Housing knowledge and skills. If you’re an agent, work with your broker to ensure your office has such programs and, where appropriate, find and utilize the very best Fair Housing training you can find, not only to minimize your own risk, but to also ensure that your consumer service efforts are on target and within the law.
Fair housing issues are critically important, and will only increase in importance as communities become increasingly diverse. Add to that developing dynamic the significant risk that Fair Housing legal proceedings represent, and it becomes quite clear that this is an issue that all professionals need to address and recommit to today and into the immediate future.
