Seattle Residential: I Do That: What is "Steering in Real Estate" Made Simple

What is "Steering in Real Estate" Made Simple

Understanding Steering in Real Estate Made Simple

In This Post

What is steering?

On the question of steering, Wikipedia has an excellent definition that does away with worrying about semantics and also does away with the myriad of "what if"questions agents endlessly ask in continuing education classes. Substitue any protected class for the word race in the definition and you will be good to go.

Who's steering

Racial steering refers to the practice in which real estate brokers guide prospective home buyers towards or away from certain neighborhoods based on their race. Racial steering is often divided into two broad classes of conduct;
  1. Advising customers to purchase homes in particular neighborhoods on the basis of race
  2. Failing, on the basis of race, to show, or to inform buyers of homes that meet their specifications[

 

Steering is an action by the real estate broker and does not involve the client. The client can ask the broker to make certain choices for the buyer or the seller that would be considered steering and get the broker in trouble. I know it is difficult for most brokers to say "I don't know..." to any question asked by a client, but in Fair Housing issues, the correct answer is, "I don't know where you mean. What neighborhoods do you like?"

It's easy enough to avoid Fair Housing issues by providing lists for clients that include several neighborhoods and as they tell you that they do or do not want a particluar areas, they are making choices, not you the broker for them.

All that said, I'm not an attorney, never dressed up like one on Halloween either. Do what your designated broker tells you to do, if you can't figure it out otherwise.

 

UPDATE NOV 7, 2010 Realtor­ magazine has a good article with 8 examples if you think steering doesn't happen these day.

 

 

 

 

Glenn Roberts
Retired

 

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Comment balloon 48 commentsGlenn Roberts • November 07 2010 10:25AM

Comments

Interesting comment.  Thank you for the insight.  Does this really happen?

Posted by Joel Gwillim, Associate - REALTOR® (CIR Realty - Condo Specialist) about 9 years ago

Glenn ~  You've definitely hit the nail on the head with this post -- terrific, timely information and great advice!

Posted by Tish Lloyd, Broker - Wilmington NC and Surrounding Beaches (BlueCoast Realty Corporation) about 9 years ago

It is hard to imagine that steering would continue to take place anywhere in the United States at this point in time.

Posted by Team Honeycutt (Allen Tate) about 9 years ago

Mike - Since they've made laws, it doesn't happen any more (yeah sure). But it was standard practice many years ago.

Tish - Thanks.

Posted by Glenn Roberts (Retired) about 9 years ago

Well said, thank you for the reminder.

Posted by Carol Costanzo, GRI, SFR (Montague Miller and Company) about 9 years ago

Allen - It happens now in subtle ways. And there are people from Fair Housing out in the field testing agents every day.

Posted by Glenn Roberts (Retired) about 9 years ago

I thought steering was a thing in the past. I sure hope it doesn't happen. Thanks for the reminder.

Posted by Indera Coggins (Re/Max 100) about 9 years ago

Excellent distinctions, thanks for sharing.  When it comes to neighborhood selections, I prefer to show out-of-town clients the satellite mapa and we can evaluate the entire area and zoom into available properties based on any criteria defined.  Local buyers usually know where they want to go and where they want to avoid without needing that, but the satellite view of the region is helpful.

Posted by Drick Ward Property Management / Broker Assoc, "RealtorDrick" - Experienced Representation (NEPTUNE REALTY) about 9 years ago

A good reminder re steering which I know is still practiced in many subtle ways.  It isn't only a race thing but neighborhoods (kids, no kids, ethnic, schools, etc.)

I've also heard/read that if you are working with your clients as an "Exclusive Buyers Agent" and they request (I'd want it in writing if legal!) certain community types, locations you can do so???

The subject has been known to ignite very heated online debates!!

Sue of Robin and Sue

Posted by Robin Dampier REALTOR®, Hendersonville & Western NC Real Estate Source (Coldwell Banker King) about 9 years ago

Carol - You are welcome

Indera - I think it would surprise you how easy it is to fall into if you're not paying attention.

Drick - Nothing beats letting the client knock on doors around a listings to see if that is the neighborhood of choice for them. At any rate, it's not a decision I'll make for them.

Sue - Steering is what an agent does, on their own, before getting such input from a buyer. I don't fell comfortable in selecting the enighborhood based on a clients suggestion of a type neighborhood they want to live in. I insist they name the neighborhood.

Posted by Glenn Roberts (Retired) about 9 years ago

Glenn,

This is certainly an area where real estate agents are "overly" cautious. Steering by the agent is legally and morally wrong. Buyers however, can choose to live where they want.

Rich

Posted by Richard Iarossi, Crofton MD Real Estate, Annapolis MD Real Estate (Coldwell Banker Residential Brokerage) about 9 years ago

Rich - exactly, and agents shouldn't be choosing the area for them.

Posted by Glenn Roberts (Retired) about 9 years ago

As much as I would love to think this is a thing of the past and can't happen in these, our modern enlightened times, it does and I'm glad you bring this up. Most often I think it's out of naivety and ignorance, but none the less... your reminder is well taken. We live locally, but our environment is global. Our culture is a much more diverse kaleidoscope of origins than it use to be and all of us deserve equal treatment, opportunity, and the right to pursue a home and place where we want to live.

Posted by Rene Fabre, Marketing in the Digital Age (First American Title) about 9 years ago

René - No one deserves only the homes an agent thinks they should see. We need to guard against that.

Posted by Glenn Roberts (Retired) about 9 years ago

Great post.  Thanks for the heads up about the issue!

Posted by Michael Weaver, Real Estate + Technology (The Vearus Group) about 9 years ago

Glenn - Like some of the other comments you've received so far, brokers and agents must be very careful with this. I had to repost your great blog.

Posted by Todd & Devona Garrigus, Broker / REALTORS® (Garrigus Real Estate) about 9 years ago

You'd be shocked if you knew how many folks here in the South point blank ask us questions about areas that are SO offensive, to me.  I"m not risking my license nor my integrity for anyone.  Great post and we all need to follow your advice!

Posted by Elizabeth Cooper-Golden, Huntsville AL MLS (Huntsville Alabama Real Estate, (@ Homes Realty Group)) about 9 years ago

It amazes me that this still happens.  Good reminder though.

Posted by Sajy Mathew, Making your real estate dreams become a reality! (Coldwell Banker Residential Brokerage) about 9 years ago

Micheal - You're welcome

Todd and Devona - Thanks for the reblog.

Elizabeth - it's a question you just have to hand back to the buy on a silver platter.

Sajy - Real estate is local but most facets of it are universal. It happens.

Posted by Glenn Roberts (Retired) about 9 years ago

I would rather be honest with clients than anything else...just my opinion

Posted by Dustin McClure (Mossy Oak Properties Outdoor Realty) about 9 years ago

In our community, Silicon Valley (Santa Clara county) CA .if the agent told the client that area is a Koran area you may not fit in will be STEERing but at the same token, if the agent ask the client; Do you like to see some area and let the client decide where the client will fit in that will be perfectly fine.

Grace Keng,CRS, CDPE www.gracekeng.com

Posted by Grace Keng, CRS, CDPE (408) 799-8887 (Keller Williams Realty Cupertino) about 9 years ago

Dustin - Honesty is the ticket, but your honest opinion may get you in trouble if you answer the wrong question.

Grace - As your name is your link, yes, if the client picks the area, it is not steering.

Posted by Glenn Roberts (Retired) about 9 years ago

Glenn,

I do find it difficult to believe that any agent would be doing this in our society today... but then maybe I'm naive.

Posted by 1~Judi Barrett, BS Ed, Integrity Real Estate Services -IDABEL OK (Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745) about 9 years ago

Judi -  I think that are many agents that do not think before they answer questions. The urge to have all the ansers is to great.

Posted by Glenn Roberts (Retired) about 9 years ago

Hi Glenn. This is a serious issue and should be taken serious. Unfortunately it still happens throughout the states. I'm glad you wrote about it.

Posted by Lana Robbins Realtor ® Licensed Real Estate Broker, Florida and Washington Real Estate (Aloha Kai Real Estate) about 9 years ago
Important blog. Thanks so much. One question though...if you outline for customer what different neighborhoods offer based upon what they say they are looking for (I.e. A B and C are pool communities, D and F are zoned for these schools, J and L offer homes on 1 acre lots or more) that's not steering....right?
Posted by Coleen DeGroff, Haile Plantation Real Estate - Gainesville FL (eXp Realty) about 9 years ago

Lana - It is unfortunate.

Coleen - Steering is the action of the agent to show a buyer only those neighborhoods that the agent thinks the buyer should be in, or not showing them areas the agent thinks they shouldn't be in. When the laws were passed it was because agents were not showing buyers some areas and were only showing them other reas based on race. Fair Housing has expanded that to include several protected classes. Know them. For example, if a client says, I don't want to live in a neighborhood with a ...name a race...living there and you agree to avoid such area by determining where those areas are yourself, you are in big trouble. Ask the buyer specifically what areas they want to live in.

Posted by Glenn Roberts (Retired) about 9 years ago

I am pretty sure that this rarely happens anyplace in the US these days. An stats on its occurence today?

Posted by George Koppel,, The Lowenstern Team (CASTLES UNLIMITED®) about 9 years ago

Glenn  Steering can also involve a real estate agent having customers use a particular lender, attorney, etc

Posted by Karen Kruschka, - "My Experience Isn't Expensive - It's PRICELESS" (RE/MAX Executives) about 9 years ago

It still happens, and I recently had someone ask me if I knew "how many (blank) lived in a particular neighborhood?"

He knew he had crossed the line and quickly apologized.

 

Posted by David O'Doherty, Clayton NC Homes, Raleigh, NC (Raleigh Realty Inc) about 9 years ago

Clients have their own ideas about where they want to look for a home. That is a very individual choice and one that must come from the buyer. I cannot imagine an agent "steering" anyone these days - but maybe it happens.

 

 

Posted by Claudette Millette, Buyer, Broker - Metrowest Mass (The Buyers' Counsel) about 9 years ago

@ comment #20. . exactly why this is a law.. . your beliefs will get you in trouble one day.

Posted by Fernando Herboso - Broker for Maxus Realty Group, 301-246-0001 Serving Maryland, DC and Northern VA (Maxus Realty Group - Broker 301-246-0001) about 9 years ago

Always need to be careful. I have been asked point blank by a client for neigborhoods with a certain race in order to make their transition easier. I tell them if they like the house, walk the neighborhood and meet the neighbors. Go to the community pool and ask questions. There is not a race field in the MLS search criteria.

Posted by K.C. McLaughlin, Realtor, e-PRO, Homes for Sale - Cary, Raleigh NC (RE/MAX United) about 9 years ago

Glenn, great summary of what steering is all about. Thanks for the reminder.

Posted by Michael Setunsky, Your Commercial Real Estate Link to Northern VA about 9 years ago

Clients ask questions that could lead to steering all the time.  I simply tell them that the areas have a wide range of residents and that if they'd like to get to know the area better, they should spend some time in the neighborhood.  I've found that most people just want to make sure they don't have any crazy neighbors.

Posted by Bryan Robertson about 9 years ago

George - I've posted a link above to a Realtor Magazine article with 8 examples that will surprise you.

Karen - Lenders and attorneys are not protected classes but the reason you direct a client a certain way could be considered steering.

David - Sometimes silence is the best eye-opening answer.

Michael - Yes.

Claudette - See the link above.

Fernando - Bingo. Some sellers can lead us into trouble to if we believe doing what they want is the safe path. The law comes first and ignorance is no excuse.

K C - Yes, clients should do their own discovery of neighborhood make-up. Love your "There is not a race field in the MLS search criteria."

Michael - Thank you

Bryan - That's why clients should knock on doors.

Posted by Glenn Roberts (Retired) about 9 years ago

The only steering I know about is when they round up cattle......You see, when you play by the rules, you may get left behind, but you sleep like a baby for it....

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) about 9 years ago

Richie - Sleep is good. Knowing the rules helps.

Posted by Glenn Roberts (Retired) about 9 years ago

Hi Glenn,

We really don't seem to run into steering issues with the exception of buyers with kids wanting to move into neighborhoods with other kids.  But once we explain that we can't show them houses based on that criteria, they understand and it doesn't become a factor anymore.

~Lisa

Posted by The Scott Loper Team Bux-Mont Premier Properties (Keller Williams Real Estate - Montgomeryville) about 9 years ago

I couldn't help but notice "I Do That" above your What is steering in real estate made simple. lol

 

So easy to have our words twisted, huh?

 

I'm sure in some market areas this is a very big deal. But, here the only steering is by the buyers ability to buy. We have 3 bedroom homes for $125,000 and 3 bedroom homes for $425,000. All homes are not created equal - for those strict Constitutionalists ;-)

 

My own opinion - this ain't rocket science.

Posted by Gregory Bain, For Homes on the Jersey Shore (Mezzina Real Estate & Insurance) about 9 years ago

I couldn't help but notice "I Do That" above your What is steering in real estate made simple. lol

 

So easy to have our words twisted, huh?

 

I'm sure in some market areas this is a very big deal. But, here the only steering is by the buyers ability to buy. We have 3 bedroom homes for $125,000 and 3 bedroom homes for $425,000. All homes are not created equal - for those strict Constitutionalists ;-)

 

My own opinion - this ain't rocket science.

Posted by Gregory Bain, For Homes on the Jersey Shore (Mezzina Real Estate & Insurance) about 9 years ago

I think you will find that steering in this case goes beyond just the racial variety. It also includes all of the protected classes that the Fair Housing laws cover. I am still amazed at the number of folks that try to skirt the law with a "wink and a nod". I have had it happen to me and have no appetite or patience for those that make it a practice. One day, they will "wink' at a state tester who will not be amused, nor should they be. There are also a lot of civic organizations out there keeping an eye on issues like this and our practices. So try to skirt them and play cutesy with Fair Housing at your own risk.

Posted by John Elwell, You Deserve a Full-Time Agent, Not Reduced Results (CENTURY 21 Bill Nye Realty, Inc.) about 9 years ago

Lisa - Steering has a surprising number of facets we don't often recognize.

Gregory - Abilty to pay is not a protected class.

John - All protected class can be steered if an agent wants to break the law or is ignorant of it. And yes, people are out there testing agents.

Posted by Glenn Roberts (Retired) about 9 years ago

Steering is not soley based on race.  It can also be based on Religion, Age, Sex (ie: gay, lesbian and transgender).  And it can often be very "well-meaning"... ie: I'd like to live near others of my type... but we're not allowed to do that either.

Posted by Alan May, Helping you find your way home. (Jameson Sotheby's International Realty) about 9 years ago

Glenn,

As in many situations we have agents that act and behave in a professional manner and then some that don't. I believe this process has been virtually eliminated today with our savvy consumers. Any agent that engages in this practice deserves to have their license yanked.

-Brent

Posted by Brent & Deb Wells, Prosper TX (LivingWell Properties) about 9 years ago

Alan - Well meaning, but illegal. Take classes. Be careful.

Brent - Among the protected classes there may be some with English as a second language and sometimes what they might ask for could take an agent in a different direction than the straight and narrow.

Posted by Glenn Roberts (Retired) about 9 years ago

This is one of those sad sad things where something so obvious has to be spelled out and explained as people still don't get it.

Posted by Donna Harris, Realtor,Mediator,Ombudsman,Property Tax Arbitrator (Donna Homes, powered by JPAR - TexasRealEstateMediationServices.com) about 9 years ago

Donna - Some are trained in how to make sales, not customer service, and obviously not in the law.

Posted by Glenn Roberts (Retired) about 9 years ago

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