NFHA Files Complaint

National Fair Housing Alliance files sales discrimination complaint against metro New York real estate company

NFHA Denounces Use of Schools as Proxy for Race

WHITE PLAINS, NY – March 23, 2006 – The National Fair Housing Alliance (NFHA) announced today the filing of a housing discrimination complaint against Peter J. Riolo Real Estate, located in Westchester County, NY. This complaint, filed with the U.S. Department of Housing and Urban Development (HUD) and the Westchester County Human Rights Commission, results from NFHA’s sales testing in the County. The investigation revealed a dramatic pattern of discriminatory comments by real estate agents. Agents used the ethnicity of the public schools to steer White families away from Tarrytown.
Racial steering is not only unethical — it’s illegal.

Agents of Peter J. Riolo Real Estate violated the federal and local Fair Housing Acts when they repeatedly recommended homes and school districts to potential homebuyers based on their race or national origin. Agents made negative comments to White homebuyers about neighborhoods and school districts with high percentages of Latino and African-American residents/students. Tarrytown schools were referred to as “bad” when the agents were discussing schools with Whites; however, Latinos and African-American buyers were shown homes in the very school districts that Whites were told to avoid. In fact, Latino homeseekers were encouraged to consider homes in Tarrytown and no comments were made about the quality of the schools.

“Illegal sales steering keeps neighborhoods segregated,” says Shanna L. Smith, President and CEO of the National Fair Housing Alliance. “Agents limit buyer choice through negative comments or by simply never showing homes to people in communities in which their race or national origin does not predominate. Homebuyers trust that their agents are showing them all available homes in their price range, but our investigation shows that this is not always the case.”
Are Tarrytown schools bad? No. According to the Tarrytown Unified School District Report in November 2005, 98% of the Tarrytown students graduate from high school and 84% go on to attend colleges including Ivy League schools, SUNY schools, and many others. “The City of Tarrytown, its school Board and residents are being injured by these illegal discriminatory practices,” continues Smith. “They have standing under the Fair Housing Act to file complaints and even lawsuits against companies and agents who discourage people from considering their community.

Today, schools have become the proxy for race. ‘Good schools’ and ‘bad schools’ are the new code words used by some real estate agents to discourage Whites from considering integrated neighborhoods.” Local governments and residents harmed by housing discrimination can sue under the federal Fair Housing Act. The City of Evanston, IL and the Village of Bellwood, IL both successfully sued real estate companies for steering White homeseekers away from their communities while marketing homes primarily to people of color.

The U.S. Supreme Court ruled in Bellwood that the agents had denied the residents “the social and professional benefits of living in an integrated society.” The Evanston case reportedly settled for more than $400,000 in 1992. The National Association of Realtors provides a high level of fair housing training to its professionals, and most states require real estate agents to have continuing fair housing education in order to keep their licenses; but in spite of these training opportunities, too many agents continue to discriminate. Evidence of their willful violation is clear from NFHA’s testing—licensed real estate professionals throughout the country have stated to testers that they know it is illegal to steer based on race or school districts.

"We urge real estate brokers to look carefully at the practices of their agents and to send a clear signal that racial steering is not to be tolerated," says Toni Downes, Executive Director of Westchester Residential Opportunities, a local fair housing agency that is co-sponsoring the press conference.

“Home ownership is a precious and significant undertaking because it opens the door to financial security,” says Delores Brathwaite, Executive Director of the Westchester County Human Rights Commission. “Where you live often affects and determines the quality of education your children will receive as well as your access to employment and health care opportunities. Engaging in racial steering is nothing less than a euphemism for intentional and forced segregation.” Over the past two years, NFHA has conducted extensive testing in 12 metropolitan areas nationwide, which has revealed a surprisingly high level of steering and other illegal behavior. Since mid 2005, NFHA has filed complaints against real estate companies located in metropolitan Atlanta, GA (Coldwell Banker “The Condo Store,” Coldwell Banker Marietta, and Re/Max Buckhead); Detroit, MI (Detroit Century 21 Town & Country) and Chicago, IL (Re/Max East-West).

Licensed real estate professionals are fully aware that racial steering is against the law. HUD’s regulations implementing the federal Fair Housing Act state that:
It shall be unlawful, because of race, color, religion, sex, handicap, familial status, or national origin, to restrict or attempt to restrict the choices of a person by word or conduct in connection with seeking, negotiating for, buying or renting a dwelling so as to perpetuate, or tend to perpetuate, segregated housing patterns, or to discourage or obstruct choices in a community, neighborhood or development. (24 CFR Part 14, Section 100.70(a))