What is Redlining in Real Estate?
Redlining is a discriminatory practice in real estate, typically involving lenders that refuse to lend money or extend credit to borrowers in certain areas of town. Those areas are often occupied by people in poverty. It is against the law to discriminate against borrowers based on race or color, among other factors.
Redlining became known as such because lenders would draw a red line around a neighborhood on a map, often targeting areas with a high concentration of people of color, and then refusing to lend in those areas because they considered the so-called “risk” too high.
Even though redlining is now against the law, major lenders today still end up in court over this practice. You might rightfully wonder how is redlining still a thing?
The Fair Housing Act is contained in the Civil Rights Act of 1968 and modified by the Fair Housing Amendments Act of 1988. The act sets forth 7 protected classes of people who cannot be discriminated against on the basis of:
- National Origin
- Familial Status
Redlining in Real Estate
For real estate agents, it means it is against the law to steer clients to particular neighborhoods, whether deliberately by the agent or at the buyer’s personal request. It means if a buyer says, “I want to buy a home in a Hmong neighborhood,” an agent can’t direct a buyer to a neighborhood made up of a high density population of Hmong.
Agents must show homes in all neighborhoods.
Who You Choose Makes a Difference When Buying or Selling a Home
5 Star Zillow Premier Agent Review:
John Sposato and his team are absolutely amazing! Extremely responsive. John was very aware of our needs and likes so our pool of homes to look at all really had the chance to be “The One”. John has been our realtor from when we purchased our original home back in 1999. He negotiated a great buy then and has gotten us our ask price on one sale, which was the highest per square foot purchase in the area at the time, and darn near asking price on our last sale, before this purchase. As he has been for 25 years, John and his team, is who I will be looking to for any future purchases myself and who i will be referring out when asked. Thank you again to John and his team! Your the best! Those thinking of real estate in the Phoenix Market would be wise to give John and his team a call. You will not be disappointed! I assure you that! ~ Ty Wilcox