What Is Redlining?

Homeownership is a major goal for many people. Not only is a house the biggest purchase many will ever make, but owning a home is a way to build and transfer wealth.

While nearly 75% of non-Hispanic white Americans were homeowners in 2020, the homeownership rate was almost 60% for Asian Americans and just over 49% for Hispanic Americans, according to the Census Bureau. Black Americans were the least likely of all minority groups to own a house, at just over 44% in 2020.

Why the stark disparity? The answer, in part, is redlining, a discriminatory housing policy that made it difficult for Black, immigrant and poor families to buy homes for several decades. While redlining was banned more than 50 years ago, its negative effects are still felt today.

Redlining definition

Redlining is a term that describes the denial of mortgage financing to otherwise creditworthy borrowers because of their race or where they want to live.

The term was coined by sociologist John McKnight in the 1960s. It refers to areas marked in red on maps where banks would not lend money, but the discriminatory practice began much earlier.

In the 1930s, as part of the New Deal, the federal government created the Home Owners’ Loan Corporation and the Federal Housing Administration to stabilize the housing industry.

The HOLC was designed to provide low-interest, emergency loans to homeowners in danger of foreclosure, while the FHA replaced high-interest loans of the early 20th century with longer-term, government-insured mortgages at lower interest rates.

To guide lending decisions, the HOLC instituted color-coded “residential security” maps. These maps separated areas the HOLC considered safe for lending from areas that should be avoided. Although the HOLC said the maps would help lenders assess risk and property values, racial biases were clearly at play.

Neighborhoods that were predominantly white were usually colored in green or blue and considered the least risky. It was easier to get home loans in these areas.

Areas with a high number of Black, Jewish and Asian families, which often had older homes or were closer to industrial areas, were typically shaded in red and labeled “hazardous.” Almost no lender would provide mortgages in these areas.

Areas that bordered Black neighborhoods were colored yellow and were also rarely approved for loans.

Effects of redlining

The grading of neighborhoods based on perceived credit risk restricted the ability of Blacks and other minority groups to get affordable loans or even to rent in certain areas.

Exclusion from government lending programs

The FHA, as well as private banks and insurers, used the HOLC’s redlining practices to guide their underwriting decisions.

As a result, it was almost impossible for nonwhite Americans to gain access to the affordable loans offered by agencies like the FHA and Veterans Administration — programs supposedly intended to expand homeownership.

In fact, nonwhite people received just 2% of the $120 billion in housing financed by government agencies between 1934 and 1962, historian George Lipsitz notes in his book “The Possessive Investment in Whiteness.”

Racially restrictive covenants

Racially restrictive covenants are agreements, often included in a property deed, that prevent property owners from selling or leasing to certain racial groups.

These covenants reinforced redlining by prohibiting Blacks and other groups from buying or occupying property in various cities throughout the country.

Although the GI Bill promised low-cost home loans to veterans of World War II, lending discrimination and racially restrictive covenants meant Black soldiers couldn’t buy homes in developing suburbs, for example.

Racially restrictive covenants remain in some real estate deeds, though a 1948 Supreme Court ruling says they aren’t enforceable.

Even so, decades later, Black and Hispanic Vietnam War veterans and their families encountered similar racial discrimination when trying to buy and rent homes in certain areas.

Is redlining illegal?

Angered by the inability of Vietnam War veterans of color to obtain housing, groups like the National Association for the Advancement of Colored People pressured the government to pass the Fair Housing Act of 1968.

As part of the Civil Rights Act, the Fair Housing Act made it illegal for mortgage lenders and landlords to discriminate against someone for their race, color, religion, sex or national origin.

Redlining maps may no longer be in use, but more than 50 years after the law was passed, housing discrimination still exists, says Andre M. Perry, a senior fellow in the Metropolitan Policy Program at the Brookings Institution.

Paired testing studies using equally qualified home seekers of different races have found that some real estate agents discriminate against people of color by not showing them properties in white neighborhoods or showing them fewer homes in general.

Perry also says research he published in 2018 shows homes in Black majority areas are undervalued by $48,000 on average, resulting in $156 billion in cumulative losses.

“Just because a law changed, it doesn’t mean the practices and procedures that still may devalue homes in Black neighborhoods, aren’t still there,” he says. “Ultimately, it’s the reduction of wealth that is the most harmful aspect of redlining.”

How redlining reinforced the racial wealth gap

The racial wealth gap is a term that describes the difference between the median wealth of whites compared with other groups. The median and mean net worth of Black families are less than 15% that of white families, according to Federal Reserve 2019 data.

The disparity exists today because Blacks were locked out of homeownership by redlining and were unable to build generational wealth, says Nikitra Bailey, an executive vice president at the Center for Responsible Lending.

“This persistent gap in homeownership opportunities between white families and families of color literally is rooted in the fact white families got a head start,” Bailey adds.

In fact, the homeownership divide between Blacks and whites is back to where it was in 1890, according to the National Fair Housing Alliance. And the gap is even larger than it was in 1968 when the Fair Housing Act was enacted.

Sheryl Pardo, a spokesperson for the nonprofit research organization Urban Institute, stresses that national, state and local policies are needed to address the homeownership and racial wealth inequities redlining has left behind.

The Urban Institute’s proposals include zoning laws to improve access to affordable housing, counseling before and after purchasing a home to prepare borrowers for the costs of homeownership, the expansion of down payment assistance programs and the development of financial products for homeowners to repair, maintain and improve their homes.

“Homeownership is still the most significant wealth-building tool in this country,” Pardo says. “If you want the Black community to make up that distance, homeownership has to be a key piece of it. It’s almost like you need a shock-and-awe response. It’s not going to happen by tweaking one little lever.”

Source: nerdwallet.com

‘How Can We Catch Up?’ Mortgage Denials Stack the Deck Against Black and Hispanic Buyers

The American dream of homeownership is not an equal opportunity ambition.

Black and Hispanic home buyers are more frequently denied mortgages than white buyers—even when their financial pictures are similar, according to a realtor.com® analysis of 2019 mortgage data. When they are able to secure mortgages, Black and Hispanic borrowers are more likely to pay higher fees and interest rates on their loans than white and Asian borrowers.

“What we call it in my community is the ‘Black tax,'” says Donnell Williams. He is president of the National Association of Real Estate Brokers, an organization for Black real estate professionals, and a broker with Destiny Realty in Morristown, NJ.

“Even if we have a college degree, we’re still getting the same treatment as a white high-school dropout,” he says.

Black buyers were twice as likely to be refused mortgages than whites, according to the realtor.com analysis of 7.2 million loan applications in 2019. Only about 5.5% of whites had their loan applications rejected, compared with 6.8% of Asians, 9.3% of Hispanics, 11.7% of Blacks, and 10.8% of multi-minority race individuals hoping to be approved. These denials were only for applicants where all the data was available for fully completed applications that weren’t withdrawn.

Decades of discrimination against people of color have resulted in lower homeownership rates among minorities than among whites in America. And that has a deep, long-term impact on wide swaths of America, since homeownership is traditionally how generations have catapulted themselves into the middle class, as their properties appreciate in value over time.

Nearly three-quarters of whites, 74.5%, owned their homes in the last quarter of 2020, according to a quarterly report from the U.S. Census Bureau. However, just 44.1% of Blacks, 49.1% of Hispanics, and 59.5% of Asians were homeowners in the last three months of the year.

“There are a lot of obstacles that are working against buyers of color,” says Brett Theodos, a senior fellow at Urban Institute, a nonpartisan research group based in Washington, DC.

On top of racial discrimination, “they’re less likely to get help with the down payment from the bank of Mom and Dad,” says Theodos. “They’ve also [often] entered adulthood with higher student loan debt, less inheritance, and are on average in professions that earn lower wages.”

Many of these problems took root generations ago. Whites who served in World War II were offered low-cost mortgages for single-family homes in newly built suburbs when they returned. Blacks and other minorities were often denied access to these loans. In many cases, Blacks, in particular, were explicitly barred from living in white communities through a toxic combination of racial covenants written in deeds and government-supported redlining.

Black Americans, like these Tuskegee Airmen, served their country in World War II but returned home to face discrimination.
Black Americans, like these Tuskegee Airmen, served their country in World War II but returned home to face discrimination.

Bettmann/Getty Images

So Blacks who wanted to become homeowners often had to buy homes at inflated prices in less desirable areas. If they were able to get mortgages at all, they typically paid more for them. And homes in these areas haven’t appreciated nearly as much as homes in white areas, except in the places that have seen significant gentrification. As homeownership is used to catapult folks into the middle class and build wealth, that’s left many minorities with less money to pass down to future generations in the form of college tuition assistance or a down payment.

“How can we catch up? How can we be on par? We didn’t have that head start of generational wealth,” laments the National Association of Real Estate Brokers’ Williams. “You want a piece of the American dream, and it’s hard. You feel like your efforts are in vain.”

Realtor.com took a hard look at which races are most likely to be denied mortgages and the reasons provided for those rejections as well as who is paying the most for those loans. To do so, we analyzed 2019 mortgage application data available through the Home Mortgage Disclosure Act. The act, passed in 1975, requires most larger lenders to collect mortgage data and make it public. We looked at only first-lien mortgages on purchases of one- to four-family homes built on site, so manufactured homes wouldn’t be included.

When possible, we compared borrowers with similar financial profiles to see who was getting loans—and who wasn’t. However, our analysis doesn’t take into account certain discrepancies like credit scores.

Blacks most likely to be denied mortgages—even with good-sized down payments

According to our analysis, even aspiring home buyers of color with sizable down payments are more likely to be denied mortgages.

Black borrowers with 10% to 20% to put down were more than twice as likely to be denied than whites offering the same down payments. Lenders rejected 6% of whites and 9% of Asians—compared with 11% of Hispanics and multi-minority race borrowers and 13% of Blacks.

These higher denial rates may be due to minority borrowers having lower credit scores, more debt, or some other financial black mark. But lending experts believe that racial discrimination also plays a part.

For example, a loan officer might tell white borrowers to improve their credit before submitting an application, be more understanding of alternative forms of income, such as a family member contributing or a side gig, or wait until mortgage rates fall a little so their monthly payment is lower. The latter would increase such borrowers’ shot at getting a loan. But a loan officer may not do the same for customers of color.

“Some of it is decisions being made by the lending officers,” says sociology professor Lincoln Quillian of Northwestern University in Evanston, IL. “They have powerful stereotypes of who is likely to repay loans.”

Black and Hispanic borrowers often pay more for their mortgages

Black and Hispanic borrowers were more likely to receive higher mortgage interest rates on their loans—which can add up to big money over time.

About 59% of white borrowers and 52% of Asian borrowers received rates within 1 percentage point of the best (i.e., lowest) possible rate. However, only 51% of multi-minority race borrowers, 47% of Hispanics, and 44% of Blacks fared as well. (It’s unknown whether some of these borrowers pre-paid or bought down their interest rates during the closing process.)

Even the smallest differences in rates can really add up. A single percentage point difference can lead to a larger monthly mortgage payment and tens of thousands of dollars more paid out over the life of a 30-year fixed-rate loan. (The exact difference depends on the purchase price of the home, the exact mortgage rates, and the size of the down payment.)

A recent study found that wealthier Blacks were given higher mortgage rates than low-income whites.

Black households making between $75,000 and $100,000 a year were saddled with a median 4.215% mortgage interest rate in 2019, according to a report from the Joint Center for Housing Studies at Harvard University. However white households earning $30,000 or less had a lower median mortgage rate of 4.16%. The study looked at 2019 U.S. Census Bureau data.

Even Black households raking in $100,000 a year or more paid slightly higher interest rates, 4.169%, than low-income whites. Whites with six-figure incomes had median 3.946% rates—about 22 basis points less than Blacks who were also earning $100,000 or more.

“We have some deep problems in the mortgage market,” Raheem Hanifa, a research analyst at the center who wrote the study.

“Some of the differences in mortgage [costs] is due to differences in who the lenders are. There’s evidence that Black and Hispanic buyers are more likely to be marketed to by lenders who are higher-cost,” says sociology professor Quillian. “White and Asian borrowers are more likely to go to traditional banks.”

Predatory lending and the proliferation of subprime mortgages doled out to communities of color led to the last housing crash, and plunged the world into a financial crisis more than a decade ago. But at least some of today’s pricier lenders may simply be smaller operations that need to charge more since they’re not dealing with the economies of scale of the bigger banks.

People of color more likely to be denied loans due to debt

Minorities are more likely to be denied mortgages due to their debt. Before deciding whether to grant loans, lenders look closely at potential borrowers’ debt loads. Their goal is to make sure borrowers can afford to pay back their credit card, student loan, car, and other payments—on top of a mortgage.

Only 1.6% of potential whites borrowers had their applications rejected because of their debt loads—compared with 2.5% of Asians, 3.1% of Hispanics, and 3.8% of Blacks. About 3.7% of multi-minority race applicants were also rejected.

While that does not sound like that much of a difference, it means that 1 in 64 white applicants is denied versus 1 in 26 Blacks.

Some minority borrowers may simply carry more debt than white borrowers. Many face discrimination in the workplace that can manifest in lower salaries and fewer promotions. Also, they may not receive the same level of financial help from their families when they get into a tough financial spot.

Black households were more than twice as likely to have student loan debt than white households, according to a recent report from the National Association of Realtors®. About 43% of Black households had student debt, at a median $40,000, compared with 21% of whites, at a median $30,000 in student debt. (The report was based on a survey of more than 8,200 home buyers who purchased a primary home from July 2019 to June 2020.)

Employment and credit histories also led to higher mortgage denial rates for minorities

Blacks and Hispanics were also more likely to be denied a loan due to their employment history. One in 568 white applicants was rejected due to their work history, compared with 1 in 282 Blacks.

“People of color, notably Native Americans, Blacks, and Hispanics, face higher rates of discrimination in hiring,” says the Urban Institute’s Theodos. “It can be more difficult to be promoted or advanced.”

That plays a big part in how much they’re earning. In 2019, Asian households had the highest median incomes of $98,174, followed by non-Hispanic white households at $76,057, according to U.S. Census Bureau data. Hispanic households had a median income of $56,113, while Black households brought in the least, at $45,438.

Blacks and Hispanics are also more likely to lose out on a loan due to their credit scores. About 0.6% of Asians and 1% of whites were denied due to their credit histories compared with 1.6% of Hispanics, 2.9% of Blacks, and 2.4% of multi-minority races.

Typically, people build good credit by paying off their student loans, car loans, and credit card bills on time each month. However, many lower-income Americans are less likely to have graduated from college or have credit cards. And what folks do pay every month—their rent, utility, and cellphone payments—often aren’t counted toward credit profiles.

“It’s not just discrimination today that is why we see denials at higher rates for Blacks and Hispanics. It’s the byproduct of generations of systemic racism,” says Theodos. “We have a long way to go in overcoming the deep, historical divide of opportunity for people of color in this country.”

Source: realtor.com

The Fair Housing Act now applies to LGBTQ renters and home buyers. Here’s what changed

HUD is expanding the Fair Housing Act

Trans and other members of the LGBTQ community are now protected under the Fair Housing Act, according to an announcement from the Department of Housing and Urban Development late last week.

The agency will now investigate complaints of housing discrimination relating to sexual orientation and gender identity — two classes not previously protected under the law. 

This is a critical change; HUD has recognized the history of housing discrimination against LGBTQ individuals and is offering legal protection to those affected for the first time.

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LGBTQ housing discrimination: An “urgent” issue

“Housing discrimination on the basis of sexual orientation and gender identity demands urgent enforcement action,” said Jeanine M. Worden, the acting assistant secretary of HUD’s Fair Housing office.

“That is why HUD, under the Biden Administration, will fully enforce the Fair Housing Act to prohibit discrimination on the basis of gender identity or sexual orientation.”

Worden continues, “Every person should be able to secure a roof over their head free from discrimination, and the action we are taking today will move us closer to that goal.”

This change is in line with the Biden Administration’s goals to reduce discrimination in housing, and to make renting and home buying more accessible and affordable.

What are Fair Housing protections?

The Fair Housing Act — technically Title VIII of the Civil Rights Act of 1968 — protects Americans from discrimination when:

  • Renting or buying a property
  • Applying for a mortgage
  • Seeking housing assistance
  • Participating in any other housing-related activity

Seven classes are explicitly protected in the Act, including race, color, national origin, religion, familial status, disability and sex. 

Prior to HUD’s latest announcement, “sex” had meant biological sex.

Now, under the new expansions, the Fair Housing Act also protects against discrimination based on gender identity and sexual orientation as well.

How this change helps LGBTQ renters and homebuyers

Thanks to the changes, LGBTQ Americans can now file complaints with HUD if they feel they’re discriminated against at any point while seeking housing.

This could include discrimination by a real estate agent, mortgage professional, rental property owner, apartment manager, or anyone else involved in the housing process.

HUD offers two examples of what LGBTQ housing discrimination might look like:

  • “A transgender woman is asked by the owner of her apartment building not to dress in women’s clothing in the common areas of the property.”
  • “A gay man is evicted because his landlord believes he will infect other tenants with HIV/AIDS.”

If you’ve experienced these or any other types of housing discrimination because of your gender identity or sexual orientation, file a complaint at HUD.gov/FairHousing.

Complaints dating back to January 20, 2020, will be investigated.

Why the Fair Housing Act is being expanded

There are three reasons HUD has expanded Fair Housing protections to trans and other LTBTQ Americans.

First, there’s President Biden’s Day 1 executive order, which calls on government agencies to “prevent and combat discrimination on the basis of gender identity or sexual orientation.”

According to agency spokespeople, HUD is the first department to comply with this executive order.

A new interpretation of the law

The recent Supreme Court case Bostock v. Clayton County also plays a role. In the 2019 case, the court found that a transgender worker’s firing was a direct violation of the Title VII of the Civil Rights Act and that “sex” protections did indeed apply. 

“Homosexuality and transgender status are inextricably bound up with sex,” Justice Neil Gorsuch wrote.

“Not because homosexuality or transgender status are related to sex in some vague sense or because discrimination on these bases has some disparate impact on one sex or another, but because to discriminate on these grounds requires an employer to intentionally treat individual employees differently because of their sex.”

According to HUD, the ruling clarified how the Civil Rights Act — including its Fair Housing provisions — should be interpreted moving forward.

“Enforcing the Fair Housing Act to combat housing discrimination based on sexual orientation and gender identity isn’t just the right thing to do-it’s the correct reading of the law after Bostock,” said Damon Y. Smith, HUD’s principal deputy general counsel.

“We are simply saying that the same discrimination that the Supreme Court has said is illegal in the workplace is also illegal in the housing market.”

A history of housing discrimination

HUD also cited numerous studies surrounding housing discrimination and the LGBTQ community in its decision to expand Fair Housing protections.

One study, for example, found that same-sex male couples were significantly less likely to receive responses when seeking a rental property. Another found discrimination against transgender women in homeless shelters.

With the expansion of the Fair Housing Act, there’s now a legal path to recourse for individuals who have been barred from housing or discriminated against in this manner.

Source: themortgagereports.com

HUD vows to protect LGBTQ from housing discrimination

The U.S. Department of Housing and Urban Development (HUD) announced Thursday it will administer and enforce the Fair Housing Act to prohibit discrimination on the basis of sexual orientation and gender identity.

In a memorandum, HUD notes the policy set forth in President Joe Biden’s Executive Order 13988 on Preventing and Combating Discrimination on the Basis of Gender Identity or Sexual Orientation, which directed executive branch agencies to “examine further steps that could be taken to combat such discrimination.”

HUD offices and recipients of HUD funds will enforce the policy immediately, said Jeanine Worden, acting assistant secretary of HUD’s Office of Fair Housing and Equal Opportunity.

“Housing discrimination on the basis of sexual orientation and gender identity demands urgent enforcement action,” Worden said. “Every person should be able to secure a roof over their head free from discrimination, and the action we are taking today will move us closer to that goal.”


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Specifically, the memorandum directs the following:

  • HUD will accept and investigate all jurisdictional complaints of sex discrimination, including discrimination because of gender identity or sexual orientation, and enforce the Fair Housing Act where it finds such discrimination occurred 
  • HUD will conduct all activities involving the application, interpretation, and enforcement of the Fair Housing Act’s prohibition on sex discrimination consistent with its conclusion that such discrimination includes discrimination because of sexual orientation and gender identity
  • State and local jurisdictions funded by HUD’s Fair Housing Assistance Program (FHAP) that enforce the Fair Housing Act through their HUD-certified substantially equivalent laws will be required to administer those laws to prohibit discrimination because of gender identity and sexual orientation
  • Organizations and agencies that receive grants through the Department’s Fair Housing Initiative Program (FHIP) must carry out their funded activities to also prevent and combat discrimination because of sexual orientation and gender identity. 
  • FHEO regional offices, FHAP agencies, and FHIP grantees are instructed to review, within 30 days, all records of allegations (inquiries, complaints, phone logs, etc.) received since Jan. 20, 2020, and notify persons who alleged discrimination because of gender identity or sexual orientation that their claims may be timely and jurisdictional for filing under this memorandum.

Sexual identity discrimination will also not be tolerated, HUD officials said. Per the outcome of Supreme Court case Bostock v Clayton County, the Court held that workplace prohibitions on sex discrimination include discrimination because of sexual orientation and gender identity.

“Unfortunately, housing discrimination is the lived reality for many LGBTQ people in our country – and this is especially true for the transgender community,” said Erin Uritus, CEO of Out and Equal Workplace Advocates. “Housing is basic human right. “Thankfully, President Biden is bringing the full force of the federal government to bear so that no LGBTQ American will be denied a roof over their head just because of who they are or who they love.”

Studies have indicated that same-sex couples and transgender persons in communities across the country experience demonstrably less favorable treatment than their straight and cisgender counterparts when seeking rental housing, per HUD officials.

“Enforcing the Fair Housing Act to combat housing discrimination based on sexual orientation and gender identity isn’t just the right thing to do – it’s the correct reading of the law after Bostock,” said Damon Smith, principal deputy general counsel. “We are simply saying that the same discrimination that the Supreme Court has said is illegal in the workplace is also illegal in the housing market.” 

On Tuesday, the Department of Justice withdrew HUD’s appeal of a case postponing the agency’s 2020 Disparate Impact Rule that would have made it harder to bring discrimination claims under the Fair Housing Act.

By withdrawing the appeal, the preliminary injunction under the case Massachusetts Fair Housing Center v. HUD will continue to delay implementation on the rule. According to DOJ court documents, HUD, along with HUD Acting Secretary Matt Ammon voluntarily moved to dismiss the appeal.

The rule, initially enacted in 2013 under the Obama administration, drew significant backlash from the housing industry after changes to the rule were made under former President Trump last year.

Criticism was especially apparent after then-HUD Secretary Ben Carson issued updated guidelines that imposed a specific, five-step approach that required regulators to prove intentional discrimination on the lender’s behalf.

Under HUD’s previous rule, lenders, landlords and other housing providers could be held liable for discrimination against protected classes even if it was not their intent to discriminate. The use of disparate impact was challenged all the way up to the U.S. Supreme Court, which upheld the rule in 2015.

Source: housingwire.com

Biden tells HUD to reassess its Fair Housing policies

New U.S. President Joe Biden has put racial equality in housing at the top of his agenda in his first week in the White House.

On Tuesday he signed several executive orders, including one that directs the Department of Housing and Urban Development to reassess the impact of regulatory actions on fair housing policies and laws. It orders the HUD to ensure that the requirements of the Fair Housing Act are being followed.

The Hill reported that Biden’s order states that the Fair Housing Act “requires the federal government to advance fair housing and combat housing discrimination, including disparate impact discrimination that appears neutral but has an unjustified discriminatory effect in practice.”

Disparate impact is a legal doctrine that enables courts to consider certain policies and practices discriminatory if it is found that it has a disproportionately adverse impact on any group based on race, national origin, religion, sex, familial status or disability, and there is no legitimate business necessity for that policy. The U.S. Supreme Court found in its “Inclusive Communities” decision in 2015 that disparate impact is a cognizable form of discrimination within the Fair Housing Act.

Under President Donald Trump, the White House revised the HUD’s interpretation of the disparate impact rule, making it more difficult for plaintiffs to prove discrimination under this theory of proof, The Hill reported. Last year, a federal judge blocked the HUD from implementing that new rule.

Biden’s executive order calls for the HUD to reassess and determine if the disparate impact rule decreed under Trump hurts any group’s access to fair housing, and whether or not it should return to the previous standard.

Biden last week signed a series of executive orders that demanded the federal government “pursue a comprehensive approach to advancing equity for all”.

“The nation is ready for change,” Biden said on Tuesday. “But government has to change as well. We need to make equity and justice part of what we do every day … Again, I’m not promising we can end it tomorrow, but I promise you: We’re going to continue to make progress to eliminate systemic racism, and every branch of the White House and the federal government is going to be part of that effort.”

Source: realtybiznews.com

How President Biden Plans To End LGBTQ Housing Discrimination

President Joe Biden‘s first days in office have been pretty hectic, so it would be easy to miss that one of the Democrat’s top priorities is ending discrimination based on sexual orientation or transgender identity.

One of the executive orders that Biden issued on Day 1 of his presidency will ban most discrimination at the federal level against members of the lesbian, gay, bisexual, transgender, and queer community. In terms of housing, this means it would be illegal for landlords, real estate agents, home sellers, or mortgage lenders to refuse to rent to, sell to, or work with LGBTQ people. Those who break the law could wind up in court and face hefty fines.

“This is a significant step, the likes of which we’ve never seen, to address discrimination against the LGBT community,” says Luis Vasquez, a legal scholar at the Williams Institute, which operates out of the law school at the University of California, Los Angeles. “Discrimination against LGBT people is persistent. It’s something that’s definitely still prevalent here in 2021.”

Although same-sex marriage was legalized across the U.S. in 2015, people who identify as LGBTQ are not protected under the Fair Housing Act. Just 23 states, Washington, DC, and certain cities protect gay couples seeking homes. Only 21 states ban housing discrimination against transgender people.

“People should be able to access healthcare and secure a roof over their heads without being subjected to sex discrimination,” states the order. “All persons should receive equal treatment under the law, no matter their gender identity or sexual orientation.”

The order clarifies that sexual orientation and gender identity fall under the federal government’s definition of “sex.” Historically, sex typically referred to someone being male or female (as identified at birth), although previous lawsuits had challenged this. But in a ruling last summer, the U.S. Supreme Court confirmed that the definition includes sexuality and gender identity.

Biden is now requiring federal agencies to do a deep dive into their policies, programs, regulations, guidance, and past executive orders, and basically clean house. The agencies are to consider suspensions or revisions to ensure that anything that includes “sex” uses the Supreme Court’s definition covering the LGBTQ community. Anything biased is expected to be thrown out.

The new president also issued an executive order this week to eliminate racially biased housing and lending policies. This is a big change from the previous four years.

“During the course of the Trump administration there was a significant rollback of a number of civil rights protections,” says Claudia Aranda, senior research associate at the Urban Institute, a nonpartisan research group based in Washington, DC.

Currently, only seven groups are protected under the Fair Housing Act of 1968. The original act made it illegal to deny housing or discriminate against folks based only on race, color, religion, and national origin. Six years later, sex was added to the list, and in 1988 it was expanded to include disability and familial status (such as having young children).

The executive order will likely lead to homeless transgender people being placed in shelters according to the gender they identify with, rather than being forced into one based on the sex assigned to them at birth. If such a situation occurs, they would have legal recourse.

“It’s important that these activities be illegal because they do, in fact, cause harm,” says Aaron Tax, director of advocacy for SAGE, a national advocacy group for LGBTQ seniors. “It sends a message to LGBT [people] across the country … that they have a right as much as anyone else to find housing. If they do face discrimination, the federal government has their back.”

While the federal protections are a huge step, individual state and city laws are still important as well.

It’s often cheaper and faster to take a fair housing complaint before a state court, says Sarah Warbelow, legal director for Human Rights Campaign, a national LGBTQ advocacy organization.

A local law may provide more coverage than the federal one, as well. For example, the federal law doesn’t pertain to landlords who rent out fewer than four units in a property where they also live. Some city and state ordinances may include those renters, allowing them to bring lawsuits.

Even after federal agencies update their regulations and policies, change isn’t expected to happen overnight. But it will go a long way to ensuring a more equitable environment, says Jeff Berger, president of the National Association of Gay and Lesbian Real Estate Professionals.

“Since same-sex marriage passed in the Supreme Court, this may be one of the most important [actions] that affects the LGBT community,” says Berger. “People who don’t experience [the inequity] really don’t believe it would happen in today’s era. … [But] we’re living in a polarized time. Not everyone in the country feels the LGBT community should have equal rights.”

Source: realtor.com