Reckoning with the past: Associations apologize for discriminatory practices

The California Association of Realtors is the most recent association to express regrets for past practices that marginalized groups based on race or ethnicity.

Key points:

  • Real estate associations in Atlanta, Minneapolis, Chicago and St. Louis have also offered formal apologies for past discriminatory practices.
  • Practices and policies included endorsing restrictive covenants and redlining, making it difficult for minorities to get loans.
  • Significant disparities remain in both homeownership rates among people of color and the share of Black agents.

The California Association of Realtors (C.A.R.) has issued a formal apology for past discriminatory practices that included endorsing restrictive covenants and supporting redlining, which has resulted in the denial of home loans to prospective buyers based on race or ethnicity.

“We have continued to unpack our difficult and sometimes obscure history of opposing fair housing laws, promoting segregation and racial exclusion prior to the Fair Housing Act of 1968,” said Otto Catrina, president of C.A.R.

“The Association was wrong. We not only apologize for these actions, we strongly condemn them, and we will continue working to address the legacy of these discriminatory policies and practices,” Catrina said in a statement.

C.A.R. joins a handful of other real estate trade associations that recently issued statements of regret about policies and practices toward people of color and underserved communities.

‘Now show us that you want to do better’

The National Association of Real Estate Brokers (NAREB), a trade association for minority real estate professionals, called the apologies an important first step but also told Real Estate News that more needs to be done “to create an environment where everyone is treated equally.”

“NAREB believes these apologies are very important and can begin authentic movements that go beyond the bias and create real estate environments where everyone is created equally,” said Lydia Pope, NAREB president. “The first step towards any reconciliation is acknowledging the wrong. We take these apologies as acknowledgement that discrimination took place. Now, we can begin to build trust and work together on providing fairer opportunities for families and individuals regardless of their race, ethnicity, gender or sexual orientation,” she said.

Pope also urged more action and greater awareness. “We are comfortable in accepting these apologies, but we also want them to be the initial action. Now show us that you want to do better, that you are willing to do more to help create an environment where everyone is treated equally,” Pope said.

MAR: ‘It’s a call to action’

The Minneapolis Area Realtors (MAR) issued a “letter of apology” in October that offered “profound regret for discriminatory practices that denied equal access to housing.”

“Most importantly, it’s a call to action for ourselves and others to do the work that’s needed to achieve an equitable housing market for all people,” the group said on its website.

MAR Board President Denise Mazone said the group’s apology and policy changes were overdue, noting the significant homeownership gap among Minnesotans: “The disparity gap for Black homeownership is in the top five in the nation,” she told Real Estate News, adding that the formal, public apologies by leading real estate groups like hers help to “shine the light on why these disparities exist and what can be done to address them.”

“When associations apologize and are accountable for the actions that set up a system that is locking people out of homeownership, they are better positioned to take action toward meaningful change and persuade others to do the same,” she said.

Real estate groups in Atlanta, Chicago and St. Louis have issued similar apologies over the past year.

In 2020, the National Association of Realtors offered an apology for past discriminatory practices and policies, and promised to work to correct unfair practices and unequal treatment in housing.

“President Charlie Oppler said unequivocally that NAR’s past policies in support of racist practices, including steering, redlining and creating covenants that prohibited non-white people from living in certain communities, were wrong,” according to a NAR statement.

Agents of color also underrepresented

The homeownership gap mirrors the racial gap in the agent community. NAR acknowledged that for decades it denied membership based on race and gender. The association also opposed the passage of the Fair Housing Act in 1968. NAR’s 2021 member profile found that only 7% of real estate professionals are Black, even though Black Americans represent about 13% of the U.S. population.

A novel program sponsored by HomeLight and the National Association of Real Estate Brokers seeks to increase the number of Black agents and associates in the real estate industry. The Black Real Estate Agent program provides training and education. It also helps to cover some startup costs, such as pre-licensing classes, agent exams, marketing and technical needs. Participants are paired with a mentor who acts as an advisor.

NAREB is encouraging more initiatives to diversify all areas of the real estate industry: “There could be more programs to train and mentor Black and Hispanic agents. There could be more programs that channel Blacks and Hispanics into pathways to become appraisers, mortgage counselors and brokers. These would be concrete steps that move the industry and our society forward.”

At MAR, the trade group has been taking steps to encourage diversity and better represent buyers and sellers in the greater Minneapolis area, starting with the organization’s leadership. “We have been diversifying our leadership and I am an example of that, as the first African American president of the association,” Mazone said.