Avoid Steering in Real Estate While Showing Properties
Fair Housing has been more prominent than ever in the Real Estate Market, especially in light of the recent Black Lives Matter Movement, and the Long Island undercover investigation that was brought to light earlier in the year. Ensuring you understand the Fair Housing Act, and the new legislation that went into effect June 20th to help avoid steering in real estate will also help you make the right recommendations to your clients. Recommendations should always be based on their needs, versus their race, background, religion, gender or disability.
One of the commonly reported practices that clients have experienced in violation of the Fair Housing Act regulations is known as “steering”. Steering is when real estate professionals influence a client’s choice of what houses and communities to consider for purchase based upon buyer’s characteristics that are protected under the Fair Housing Act: race, color, religion, gender & disability. Steering most commonly occurs by real estate professionals when they do not tell their clients about available properties in certain areas that meet their buying criteria, or when they use their opinions on certain communities to influence buyers away from these areas due to their race, gender, color or religious background.
While this practice is illegal under the Fair Housing Act, a study has shown that steering still occurs in real estate transactions. Newsday newspaper conducted a recent investigation where two testers, one white and one minority tester had multiple real estate professionals show them properties. Both testers had similar financial and property needs. The investigation showed that 24% of the time, the real estate professionals showed the white tester different communities and properties versus the minority tester, which showed that steering is still being practiced within the real estate industry.
To ensure you are objective and fair with all clients, and abiding by the legislation set forth by the Fair Housing Act, we have compiled some information on how to avoid steering in real estate when showing properties. Read on to make sure to:
Be objective: Provide clients with listings that match their financial and property needs, regardless of their background.
Be clear: When clients use vague terms such as ‘safe’ ‘friendly’ or ‘nice’, ask objectively to clarify their criteria, such as property and community features.
Be honest: Don’t let your personal opinion interfere with giving your clients objective information about particular communities and properties. Refer them to third party resources to help them make informed decisions about certain areas and properties.
Pay attention: Don’t let your own bias get in the way of making decisions for clients. If you have eliminated or suggested certain areas or properties, ask yourself why you made that decision. If it is because it does not suit their financial budget or housing needs, then you are doing your job. If not, re evaluate your decisions to ensure that you are working objectively for your clients.
As a REALTOR®, you are bound by the NAR’s Code of Ethics in practicing real estate. Fair Housing is included in the Code of Ethics. Brushing up on the Fair Housing Act Regulations, and the NAR Code of Ethics on a regular basis can help ensure you are up to date with the most recent information, allowing you to maintain strong relationships and the best possible outcome for your clients. Review the NAR’s Code of Ethics, and update yourself on the latest Fair Housing Regulations in this informational Webinar from NYSAR, which went into effect on June 20th, or review the detailed report of the new Fair Housing Amendment. We hope this information helps you avoid steering in real estate when showing properties and improves the experience for all of your clients.