The Real Estate Agent’s Ultimate Guide To Fair Housing

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This January marks Inman’s fifth annual Agent Appreciation Month, which culminates at Inman Connect New York in a celebration of agents at the end of January. Plus, we’re rolling out the coveted Inman Power Player Awards, as well as the New York Power Brokers and MLS Innovators awards.

Fair housing is a fundamental principle that ensures equal access to housing opportunities for everyone. Real estate agents play a crucial role in upholding fair housing laws and in promoting a diverse and inclusive housing market.

Nearly five decades into the Fair Housing Act’s influence on housing and real estate, it continues to be a necessary and integral part of every transaction. In this article, we will explore the key aspects that real estate agents should be aware of regarding fair housing.

Why fair housing?

The need for federal fair housing legislation evolved out of a long history of discriminatory practices in the United States. For much of the past century, the nation existed as a racially segregated society in which black and white citizens occupied separate and vastly unequal neighborhoods and many Americans were prevented from buying or even renting in areas of their choice.

The Fair Housing Act was enacted as part of the Civil Rights Act of 1968 and is administered by the Department of Housing and Urban Development (HUD). The Fair Housing Act prohibits discriminatory practices such as refusing to rent or sell housing, setting different terms or conditions based on protected characteristics, providing false information about housing availability and harassing or intimidating individuals based on their protected status. 

What housing is covered? 

The Fair Housing Act covers most housing. In some circumstances, the Act exempts owner-occupied buildings with no more than four units, single-family housing sold or rented without the use of a broker and housing operated by organizations and private clubs that limit occupancy to members.

Protected classes

The protected classes under the Federal Fair Housing law include race, color, religion, sex, national origin, disability and familial status. However, 49 states and Washington, D.C., have adopted their own fair housing laws to expand upon these federal protections, such as prohibiting discrimination based on an individual’s sexual orientation, gender identity or source of income.

These laws regulate which protected classes are included, the types of discriminatory actions that are prohibited, and when discrimination is exempt under the law. 

Additionally, real estate agents who are members of the National Association of Realtors are also held to the NAR Code of Ethics and the standards of practice in Article 10, which prohibits Realtors from discriminating based on race, color, religion, sex, handicap, familial status, national origin, sexual orientation or gender identity in the provision of professional services and employment practices.

What’s prohibited?

No one may take any of the following actions based on race, color, religion, sex, disability, familial status, or national origin: 

  • Refuse to rent or sell housing 
  • Refuse to negotiate for housing 
  • Make housing unavailable 
  • Otherwise deny a dwelling 
  • Set different terms, conditions or privileges for sale or rental of a dwelling 
  • Provide different housing services or facilities 
  • Falsely deny that housing is available for inspection, sale or rental
  • Deny any person access to, membership or participation in, any organization, facility or service (such as a multiple listing service) related to the sale or rental of dwellings, or discriminate against any person in the terms or conditions of such access, membership or participation.
  • Coerce, threaten, intimidate or interfere with a person’s enjoyment or exercise of housing rights based on discriminatory reasons, or retaliating against a person or organization that aids or encourages the exercise or enjoyment of fair housing rights.

Redlining, steering and blockbusting

For many real estate professionals, the terms redlining, steering and blockbusting seem to be of ancient times, but these practices may be more modern-day than you think.

Redlining is the refusal to provide financing or insurance in certain areas based on membership of a protected class and is a clear violation of Fair Housing laws.

Initially introduced in 1934 with the creation of FHA and VA loans, redlining was used as one of the key elements of the FHA Underwriting Manual. 

Most recently, in January 2023, the U.S. Department of Justice announced the largest redlining settlement in the department’s history — a $31 million settlement with City National Bank over allegations that the Los Angeles-based bank withheld services from customers who live in low-income neighborhoods, disproportionately impacting communities of color. 

Steering is influencing a buyer’s choice of communities based upon one of the protected characteristics. According to the 2022 NAR Snapshot of Race and Homebuying in America report, the most common discrimination homebuyers witnessed or experienced was steering towards or away from specific neighborhoods, with 50 percent of Hispanic/Latino, 48 percent of Asian/Pacific Islander and 46 percent of Black/African American homebuyers having experienced this. 

Most real estate professionals think of steering as simply refusing to show homes in a certain neighborhood or recommending people steer away from certain neighborhoods, but steering can often be less obvious.

Steering occurs, for example, when real estate agents express views about communities with the purpose of directing buyers away from or towards certain neighborhoods due to their race or other protected characteristics and complying with a consumer’s request to help seek or avoid areas near people of certain ethnicities or religions.

Blockbusting is when, for profit, someone persuades or tries to persuade homeowners to sell or rent dwellings by suggesting that people of a particular race, etc., have moved or are about to move into the neighborhood.

Additional protection for those with disabilities

The No. 1 fair housing violation is actually against people with disabilities. According to the 2019 Fair Housing Trends Report from National Fair Housing Alliance (NFHA), 56.33 percent of the complaints logged in 2018 were complaints based on disability.

One of the most common violations is the failure to reasonably accommodate a tenant with a disability. This includes making necessary changes to policies, practices or structures to ensure that individuals with disabilities have equal access to housing.

For example, a landlord would be required to assign a parking space to a mobility-impaired tenant if the tenant requests such a reasonable accommodation, even if parking spaces are not typically assigned to tenants. There are additional accessibility requirements for new multifamily buildings  with four or more units that were first occupied after March 13, 1991.

When you consider that up to one in four adults in the US have some form of disability, it becomes imperative for real estate agents to become familiar with the fair housing laws and how they apply to all consumers.

Advertising and marketing

There are a number of other things agents should be aware of when advertising and marketing in real estate. For example, an MLS listing that says “perfect for small families” would be a fair housing violation as it expresses a preference for a protected class (familial status).

When advertising housing, it is illegal to specify a preference or limitation or to alter the terms and conditions of housing based on someone’s membership in any of the protected classes. 

Owning the segment of prospective customers you want to attract lets you create a more effective targeted message and ultimately yields you a better bottom line. But target marketing for real estate agents can get tricky because it can be unlawful to base your marketing strategies on prospective clients’ membership – or nonmembership – in any of the classes protected by the federal Fair Housing Act or by your state’s fair housing laws.

Specifically, it is illegal to target the distribution of advertisements on the basis of any protected characteristic.  

It is beneficial for real estate agents to use inclusive language in advertising, which can be described as words and phrases that avoid biases, slang and expressions that discriminate against or exclude anyone based on race, gender, socioeconomic status and ability.

Training and education

Staying informed about fair housing laws and best practices is an ongoing responsibility for real estate professionals. Regular training and education on fair housing can help agents stay up-to-date with changes in legislation and reinforce the importance of promoting diversity and equal access in the housing market.

Many states require fair housing training to obtain a real estate license and in many cases, keep a real estate license. 

NAR new-member applicants must now complete two hours of fair housing training, and existing members must complete two hours of fair housing training every three years as a condition of NAR membership, including one training option that is of no cost to members. The three-year cycle coincides with NAR’s existing Code of Ethics training requirement and begins in 2025.

This training will help Realtors understand their responsibilities and obligations to ensure fair treatment and equal opportunities for all clients and customers. It will also provide agents with a comprehensive understanding of the laws, regulations and best practices related to fair housing.

Penalties for violating fair housing 

Penalties for violating Fair Housing can be steep. If HUD determines that someone has violated the Fair Housing Act, they can be assessed a maximum civil penalty of $21,663 for a first violation.

Anyone who has violated the Fair Housing Act in the previous five years could be fined a maximum of $54,157, and anyone who has violated the Act two or more times in the previous 7 years could be fined a maximum of $108,315.

Additionally, members of the National Association of Realtors may have action taken by their local association. Local associations can take action by requiring mandatory attendance at educational courses and seminars, imposing a fine, or suspending or terminating membership.

While most local associations do not have the authority to suspend or revoke a real estate professional’s license, the state licensing authority may choose to do so.

Real estate agents play a vital role in creating a fair and inclusive housing market. By understanding and adhering to fair housing laws, agents contribute to eliminating discrimination and promoting equal opportunities for all individuals.

Upholding these principles ensures legal compliance and fosters a more just and equitable society where everyone has the right to secure housing without discrimination based on their background or characteristics.

As the head of inclusion and belonging for Keller Williams Realty International, Julia Lashay Israel advises, trains and coaches leaders, team members and agents to recognize and address diversity, equity and inclusion opportunities and challenges across the organization.



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