Real estate agents and steering today

Many real estate agents today won’t answer certain questions but does this eliminate steering?

Agents such as Foster and Thakkar are hypersensitive because they don’t want to run afoul of the Fair Housing Act, which prohibits discrimination on the basis of race, color, religion, gender, national origin, familial status, disability or handicap. The law is administered by the Department of Housing and Urban Development. Penalties for violating fair housing rules can be costly, so many real estate brokerage firms train agents on what constitutes “steering” of homebuyer clients as well as what could be interpreted as showing any form of bias against any “protected class.”

What can agents do when clients ask certain questions? Here are several of the examples provided:

“We can’t answer,” Foster said. “It’s all too subjective.” Instead, she refers them to online information sources about whatever they’re asking — websites that rate schools, statistical compilations on crime rates and the like…

“It’s a very common question,” he says: “Can you tell us how many other Indian families live on this street?” Even though he thinks he understands the thrust of the question — are there people like us around? — he declines to answer directly. Instead, he supplies them a list of the names of current owners on the street, allowing his clients to decide for themselves whether the names indicate that they are Indian or not.

Referring people to other sources may lead to issues:

But some fair housing advocates are concerned that the online information available today may actually enable a subtle form of racial steering when agents name specific sites that offer highly localized racial and ethnic breakdowns and refer clients to them. Lisa Rice, executive vice president of the National Fair Housing Alliance, a nonprofit group that has fielded teams of white and minority “testers” to detect bias in homes sales, thinks that in the event of fair housing complaints against those agents, the fact that they made such specific referrals could be held against them.

It seems to me that one of the best ways to eliminate this issue is to educate homeowners about all the potential information they can access. Stop them from asking in the first place. Realtors could even make this clear at the beginning. The Internet certainly presents a lot of available information to possible home buyers ranging from the Census to other data aggregators to message boards to municipal websites. In other words, it is not hard to find out this sort of information. Yet, this would go against the argument that realtors make about why they are still necessary: they have inside information about the home and the entire process. Additionally, all the online information is not necessarily easy to interpret. Say a homeowner is interested in future property values: can they make a prediction based on what is online? Or, say that an online message board suggests one thing is happening while the local newspaper claim something else is taking place. How could someone unfamiliar with the area make a judgment regarding conflicting information?

In the long run, if people want to fight residential segregation and housing discrimination (which are legitimate concerns), would it be better to remove real estate agents from the process or not?

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