Real estate agents should be knowledgeable in specific laws, regulations and guidelines relating to housing. One broad collection of rules, The Fair Housing Act, is especially relevant. Fair Housing laws were put in place to prevent discrimination.
You have a fiduciary duty as a real estate agent to follow relevant laws. At the same time, you want to do so to ensure you’re operating in a generally ethical way, even outside of your role as a fiduciary.
The following are some general things to know about the Fair Housing Act and other relevant topics.
The Federal Fair Housing Act
Under the federal Fair Housing Act, a real estate agent has to remember seven classes are protected. It’s easy to forget about this, but it must be core to what you do to remain compliant. The seven protected classes under this legislation are:
• Color
• Race
• Religion
• National origin
• Disability
• Sex
• Familial status
No one involved in real estate in any way can discriminate against people for the reasons above. This applies to not only real estate agents but also lenders, brokers and landlords.
Implications of These Laws
If you’re a real estate professional, there are certain requests you legally can’t address. It doesn’t matter the intent behind some of these requests.
For example, if you’re a real estate agent and a buyer wants to learn more about crime and safety in a neighborhood, you shouldn’t tell someone a community is safe or not. Instead, you should direct your buyer to sources of information, like local crime statistics.
When creating listings, you can’t use certain phrases, such as couples, singles, professional or bachelor pad. Children not welcome, low-income, handicapped, and Section Eight are also terms to avoid in listings.
Legally as a real estate agent, you shouldn’t answer questions about the racial or ethnic makeup of a neighborhood. You also can’t steer your client in a particular direction as far as a neighborhood based on their ethnicity or race.
National Association of Realtors Code of Ethics
The National Association of Realtors (NAR) has a code of ethics indicating that Realtors can’t deny professional services to anyone because they’re a member of any protected classes above or due to sexual orientation or gender identity.
In November 2020, the NAR Board of Directors reaffirmed the commitment to fair housing by approving recommendations that extend the Code of Ethics to speech that’s discriminatory or conduct outside of your practice of real estate that’s not in line with ethical standards.
What You Can Tell Your Clients
As a good and ethical agent you can point your clients toward resources that will help them answer questions they might have about a neighborhood. Your clients can then come to their own conclusions. Your goal is always to share factual information and be a resource, but not interpret said information.
With this in mind, you have to remember along with laws regarding fair housing, you want to think about how your clients might perceive things differently than you do.
You never want to make assumptions about your clients or their preferences because you could inadvertently violate fair housing, but you’re also not upholding the profession's standards.
