This post is part of our ongoing series on the relationship between racism and homeownership.
So you found a great real estate agent, a real pro who knows all about the area where you want to buy a home. They’ve walked the streets, they’ve chatted with residents. They may even have kids in the local schools and hang at the summer block parties. But that doesn’t mean they can tell you all their opinions about a neighborhood.
If a real estate agent or another professional in the homebuying process influences your decision to live in one area or another in any way, it could be considered “steering” — and even if it stems from good intentions, this is a violation of your civil rights.
Fair housing laws
Real estate agents and other industry pros must obey federal, state, and city fair housing laws that exist to prevent discrimination against protected classes of people, designated by your race, sex, familial status, or other qualifying characteristics.
If they violate these laws, they can face penalties including fines and suspension of their licenses. For more information on these regulations, check out our post on spotting discrimination against homebuyers.)
(Hold up! We’re saying “real estate agents,” but you’ve heard them referred to as brokers and Realtors … what’s the difference?)
Racial steering in real estate
It’s important to note that in real estate, all forms of steering are illegal. The most common type of steering, however, is racial.
Racial steering is when a real estate agent, mortgage lender, or any other professional, influences a homebuyer’s decision to live in a community mostly populated by their race.
They can do this in numerous ways, such as by advising against shopping for homes in certain areas or saying that someone would be “more comfortable” in one neighborhood over another. Another example is if a lender offers less information or a less-favorable mortgage to buyers of a certain race or who are shopping in a specific neighborhood.
The legacy of racial steering
Steering became illegal with the Fair Housing Act in 1968, but its legacy persists.
Throughout history, people of color were segregated into certain neighborhoods, while white homebuyers were encouraged to purchase homes in others, typically the suburbs. Since home prices in neighborhoods mostly populated by white households rose at a faster rate, many of these homeowners were able to build more equity and wealth for future generations than homeowners of color in other areas.
Meanwhile, property taxes in areas with more expensive home prices also tend to be higher, which funnels more money into local schools, roads, and other public infrastructure, often leading to better access and opportunity for those neighborhoods.
In short, the history of racial steering in housing in the United States has led to some neighborhoods persistently lacking adequate housing, education resources, and other opportunities for generations.
How to avoid steering in real estate
To be clear: Real estate agents can provide websites and other resources to research an area on your own, but they cannot answer specific questions about topics like crime or schools.
Here are a few examples of topics of conversation that can lead to steering from pros in the homebuying process, and how they can be avoided:
- Neighborhood residents
Real estate agents may not profile the “type” of people who live in an area or building, explains Gene Gonzales, a Realtor with Iron Key Real Estate in Fresno, California.
“We have to be careful not to push people in any direction,” he says. “The best I can do is suggest public resources so you can make a knowledgeable decision based on your own research.”
Buyers must come to their own conclusion, agrees Susanna Haynie, managing broker with the Co Re Group in Colorado Springs, Colorado. “Neighborhoods change constantly, and so does their ‘vibe’,” she says.
Rather than putting your agent on the spot with this question, consider checking out community Facebook groups or doing a neighborhood search in StatsAmerica.org.
“An agent cannot determine what will make someone feel safe and comfortable or unsafe and uncomfortable,” Gonzales says. “Also, you never truly know the intent of the person asking the question. The best advice is to suggest the client spend some time in the neighborhood and come to their own conclusion.”
To find about crime in an area, look to the local police precinct and its website, or search in sites like crimereports.com, myneighborhoodupdate.net, and spotcrime.com.
Another topic agents must be careful about discussing is schools. They may not praise certain districts or indicate which schools are better.
Instead, sites like greatschools.org and schooldigger.com provide ratings and reviews, and community Facebook groups can be helpful, as well.
Filing complaints about steering
If you feel you’ve been a victim of racial steering and you’d like to report the incident, contact a fair housing center.
These private, nonprofit organizations can investigate your complaint and may refer you to the U.S. Department of Housing and Urban Development (HUD), a federal agency that assists with housing and community development programs. You can also contact HUD directly at 800-669-9777, or visit its website to find more information or to file a complaint.
As you’re shopping for homes with your agent, you can of course ask plenty of questions, and you should! Just know that regarding some topics, they may smile and point you toward another resource.
Speaking of other resources, here are some more posts that may interest you:
- Our bibliography on racial injustice in the United States.
- Seeing fewer homes for sale? Check out our tips for buyers in a tight market.