Discrimination in real estate sales still happen to this day. Sometimes, they happen without anyone realizing they’re doing it. That’s why most real estate discrimination goes undetected.
Disclosing information about a neighborhood is a delicate process, so you must know what information you can and shouldn’t share.
The first step to combat discrimination in the United States was the Civil Rights Act of 1866. However, neighborhood discrimination wasn’t addressed until the Civil Rights Act of 1968.
Also known as the Fair Housing Act, this legislature made “refusal to sell or rent a dwelling to any person because of his race, color, religion, or national origin” illegal.
Real estate agents can’t determine where the home buyer can or cannot live. That’s why choosing your client’s future home should be handled with caution.
The Fair Housing Act and Real Estate
During 1968, The Fair Housing Act was passed to counteract discriminatory behavior that controlled the ethnic makeup of neighborhoods.
This legislature was to provide equal housing opportunity to everyone, no matter their race, religion, or national origin.
This landmark regulation wanted to take the discrimination out of housing.
This was an expansion on the Civil Rights Act of 1866, which didn’t enforce federal action against discriminatory behavior in housing.
The major acts in housing discrimination was steering and redlining. Each attempted to serve the real estate agent to make a sale or fragment neighborhoods based on ethnicity.
What is Steering in Real Estate
Steering is the act of guiding home buyers to neighborhoods based on their race, ethnicity, or religion. It also worked in guiding home buyers away from neighborhoods.
This practice was used by real estate salesperson agents and urban planners.
Racial steering is used to segregate neighborhoods.
Steering as an act is something that hasn’t gone away since the early 1900’s. One of the most recent national cases occurred in 2006.
When dealing with a client, you should always consider where they want to live. Never outright choose the location for them without hearing their interests, tastes, and needs.
Therefore, the best way to avoid racial steering (even inadvertently) is by asking the client “where do you want to live?”
What is Redlining in Real Estate
Redlining is another discriminatory behavior in real estate. This is the act of segregating neighborhoods based on race, ethnicity, and religion.
Redlining was used most often with banks in the mid to late 1900’s to avoid financial investment in minority populated neighborhoods.
This form of discrimination accounts to the devaluing of land and property by encouraging a negative stigma.
For example, in the late 1900’s, banks wouldn’t give loans to residents of redlined zones, causing well-being of houses and property to drastically diminish.
This resulted in the well-being of land to decrease as well.
Real estate agents must show property in a variety of neighborhoods. In other words, steering a client to a redlined neighborhood is illegal and must be avoided.
When a client asks about the racial makeup, crime rate, or education rate of a neighborhood, always direct them to resources that will help answer these questions.
Advertising and Excluding People
Advertising property must be handled with care. Promoting a property could result in excluding certain populations from the property. This won’t only be considered illegal practice, but it could harm your business whether intentional or not.
You must be conscious of advertisement phrasing.
Aside from being aware of race, ethnicity, and religious practice, you should consider how you speak to people of specific gender, disability, and familial status.
Words of Advice for Wording your Properties
Here’s one example of unaware exclusionary phrasing: When advertising a property with a great hiking trail, you might say, “This home is fantastic for hikers.”
What you might not realize is this is excluding people who cannot hike, because of a disability.
They will be less likely to work with you, because of being excluded from your advertisement.
When you’re in doubt about whether or not something could be exclusive, you should omit it from the advertisement. Also, always be aware of how your speaking to others, whether through a listing or in person.
Inclusivity goes a long way – especially in real estate.
Every week, we release in-depth videos to help viewers become successful real estate agents on our CA Realty Training YouTube Channel. You will also find videos on our free introduction classes into our courses.