Friday, April 7, 2017

What Realtors CAN and CAN’T say

Did you know that April is Fair Housing Month? Visit their site or contact us for more information! 


Most home buyers and sellers consider their real estate agent an invaluable source of knowledge. But many people still don't realize that there are very tight rules governing what Realtors can and can't disclose.  Even mentioning specific topics or answering certain questions could result in fines, loss of license – or even trigger litigation. 

It doesn't matter if the Realtor is working with buyers or sellers, but offering information about a neighborhood or community might violate the Fair Housing Act, which was enacted in 1968 to control widespread discriminatory practices.

The Fair Housing Act protects against discrimination in housing based on race, color, national origin, religion, sex, disability or even family status. This law recognizes that Realtors can potentially steer prospective homebuyers or renters toward or away from a community based on class, gender, or ethnicity. 

This even applies to the language we use in advertising when listing a home to ensure that we don't influence or target any particular group.

So what types of information are off-limits for Realtors to discuss with clients?

Average household income:
A Realtor CAN’T talk about the relative wealth or socio-economic class of a neighborhood or area.  

Believe it or not, Realtors CAN'T even give ratings or statistics on schools. If this is information relevant to our client’s search, we CAN direct them to resources, which we'll cover below.

A Realtor CAN’T talk about the presence of any religious groups or demographics of worshippers in any neighborhood or area.

Crime statistics: 
Not a chance. The Fair Housing Act even prevents Realtors from disclosing crime statistics about a part of town.

Environmental concerns: 
Realtors are also prohibited from mentioning possible environmental issues like cancer scares around cell phone towers, bad water quality, or other public health issues.  

There are legitimate exceptions to these Fair Housing laws. For example, a Realtor must disclose information that pertains to a specific property, i.e. if a house is in a floodplain, a murder occurred at the property, or if there are materials considered hazardous that were grandfathered it. 

It’s important to note that Realtors have to choose their words carefully when answering questions about neighborhoods or making recommendations so they don't violate the law.

Here are some common client questions that may seem like innocent inquiries but are nonetheless off the table:

“This house might be a bit much for a single woman on her own.”

“This area is perfect for young families." 

“The seller would like a nice family to put roots down here.”

“This neighborhood wouldn’t work for you. Too many [insert group] people live here.”

“To get to the house, turn left on Rose Street. If you go past the church, you’ve gone too far.”

“That’s a pretty high-crime section of the city.”

“I know the second-floor unit because you are in a wheelchair. I can show you the ground-level unit though.”

Even advertising a listing or rental as “No pets,” or "No kids," "Great for young couples," "Looking for quiet older renters," are forbidden. Again, I see this all the time with rentals.  

If a client, homeowner, buyer, seller, prospective tenant or any other party involved complains that a Realtor violated the Fair Housing Act, they could end up paying the victim compensation, damages (including housing costs), civil penalties to the government, and even legal fees.  

So what CAN Realtors say? And if you're a homebuyer who is just trying to prioritize and make an educated decision, what can you do?

We ARE entitled and encouraged to provide non-biased sources of information, tools, and databases that inform and empower clients. Basically, we cannot answer those questions outright, but we can direct them to the places they can get the answers.  

So if someone is home shopping and asks us about the quality of schools in the neighborhood they’re interested in, it’s perfectly alright for us to give them certain things. Pamphlets, websites, guides, and other materials from the city, school, independent third-parties, and title companies and other organizations that may be parties to the buying or selling transaction are all legal and allowable. 

It’s important for everyone involved in real estate, be they homebuyers, sellers, and shoppers to understand these Fair Housing laws and not pressure their Realtor to cross the line and be out of compliance. So when describing the ideal home or neighborhood to us, please don't use demographics based on economics, crime rates, or of course race, sex, religion, or disabilities.

If you want access to some great websites, sources of information, tools, and education about any neighborhood, feel free to contact us. We’ll make sure you have everything you need while adhering to the letter of the Fair Housing Laws.


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