Avoiding discrimination in advertising

In advertising, a company needs to target audiences effectively and directly. Goods marketed toward women are stereotypically packaged in pastels, identifying them as feminine before you can even say “For Her.”

While that might pass muster in retail, applying such a strategy in real estate may amount to implicit discrimination or worse – explicit discrimination.

Implicit discrimination describes actions which are not openly discriminatory, but still yield discriminatory results. For example, consider an agent  who only directs minorities buyers to other minority neighborhoods.

Likewise, some neighborhoods are not a good fit for every homebuyer, but when selling and renting properties, it is risky to limit your marketing blitz to a single group — especially if that group is a protected class. A protected class is a group of people legally protected from discriminatory activities.

Federal protections under the Federal Fair Housing Act (FFHA)

The printing or publishing of an advertisement for the sale or rental of residential property that indicates a wrongful discriminatory preference is a violation of the Federal Fair Housing Act (FFHA). [42 United States Code §3604(c)]

A property sold or leased for residential occupancy is referred to as a dwelling. The discriminatory preference rule applies to all brokers, developers and landlords in the business of selling or renting a dwelling. [42 USC §§3603, 3604]

Real estate advertising guidelines are issued by the Department of Housing and Urban Development (HUD). The guidelines are the criteria by which HUD determines whether a broker has practiced or will practice wrongful discriminatory preferences in their advertising and availability of real estate services.

HUD guidelines also help the broker, developer, and landlord avoid signaling preferences or limitations for any group of persons when marketing real estate for sale or rent.

Wrongful discriminatory preferences in advertising

The selective use of words, phrases, symbols, visual aids and media in the advertising of real estate may indicate a wrongful discriminatory preference held by the advertiser. When published, the preference can lead to a claim of discriminatory housing practices by a member of the protected class.

Words in a broker’s real estate advertisement that indicate a particular race, color, sex, sexual orientation, handicap, familial status or national origin are considered violations of the FFHA.

To best protect themselves, a broker refuses to use phrases indicating a wrongful preference, even if requested by a seller or landlord. Words or phrases indicating a preference in violation of the rights of persons from protected classes include:

  • white private home;
  • perfect for newlyweds;
  • Jewish (or Christian) home;
  • country club nearby;
  • black home;
  • walking distance from the synagogue;
  • ideal bachelor pad;
  • spacious master bedroom;
  • Hispanic neighborhood; or
  • adult building.

Preferences are often voiced in prejudicial colloquialisms and words such as restricted, exclusive, private, integrated or membership approval.

Indicating a preference by age is an exclusion from unlawful age discrimination when marketing qualified 55-or-over residences or communities.

Words are not the only way to discriminate. Selectively using symbols, images, human models, visuals and other forms of media indicate preference too.

  • Examples of symbols and other visual aids include: sexuality pride flags;
  • religious images such as a cross or Star of David;
  • gender symbols;
  • handicapped signs; and
  • flags representing nationalities.

Discrimination is not only immoral, but it also hurts business. Aiming an advertisement at a particular class may lead people outside the group to believe  they are not welcome in the area. Also, it may make the seller and their agent look like they only want to do business with a few select groups.

The phrases above directly target protected classes, so leave them out of your practice – period. This includes listings and marketing materials, as well as applications and deeds. While some may not sound aggressively prejudiced, even the seemingly harmless phrase “spacious master bedroom” is to be avoided due to the historical underpinning of the expression..

Regardless of what the advertiser meant, these problematic phrases can alienate clients and welcome a discrimination lawsuit.

Further, these phrases may not directly reference protected classes. Words like “exclusive,” “private” and “restricted” make the neighborhood sound like it has an income barrier. The Atlantic reports that many country clubs, restaurants and hotels have used the word “restricted” to signal their establishments did not welcome Jewish patrons. And “membership” approval raises all sorts of loaded questions, like what makes someone qualified for a membership and who approves members.

The HUD fair housing poster

HUD issues guidelines that require real estate brokers selling or renting single family residences to display a fair housing poster. [24 CFR §§110.1, 110.10]

The fair housing poster is available at any HUD office. [24 CFR §110.20

The broker marketing dwellings for sale or rent is to display the fair housing poster:

  • in the broker’s place of business; and
  • at any dwelling offered for sale, other than SFRs. [24 CFR §110.10(a)]

Thus, a broker holding an open house at a SFR listed for resale is not required to display the fair housing poster at the residence.

However, if a dwelling is marketed as part of a residential development, the fair housing poster is to be displayed by the developer during construction of the development. Later, the poster is to be displayed in the model dwellings whether or not the dwellings are sold through a broker. [24 CFR §§110.10(a)(2)(ii), 110.10(a)(3)]

The fair housing posters are to be placed where they can be easily seen by any persons seeking to:

  • engage the services of the broker to list or locate a dwelling; or
  • purchase a dwelling in a residential development. [24 CFR §110.15]

Failure to follow HUD guidelines

Even though it is required, a broker will not be subject to any penalties for failing to display the fair housing poster. However, failure to display the fair housing poster is initially considered sufficient evidence in a lawsuit to show that a broker practiced discriminatory housing practices. [24 CFR §110.30]

Also, a real estate broker and their agents who follow HUD advertisement guidelines and display the fair housing poster are less likely to practice a discriminatory activity.

The fair housing poster openly assures potential sellers/landlords and buyers/tenants the broker does not unlawfully discriminate in the services offered.

Also, the broker following HUD advertising and poster guidelines is in a better position to defend themselves against a fair housing lawsuit. Use of the fair housing poster indicates to the public the broker’s invitation to work with all individuals.

How to protect yourself

As a matter of best practices, do not use discriminatory language or images in your practice, and keep in mind the ostensibly welcoming advertisement examples discussed here. Further, to create the best impression and reach the most people, avoid all language that is politically charged or can be construed of carrying an unintended loaded meaning.

No matter how well-intentioned the specifications may be, good intentions will not protect brokers and agents against fines.

Also, do not direct potential buyers or renters to areas you think are suitable for them based on their protected status. They may not want what you think they do, and doing so is unlawful.

It is best to cast a wide net in real estate when advertising homes as using discriminatory ads could lower turnover rates and cost you your fees. Make listings sound inclusive, not like they’re trying to appeal to a niche. Fair housing is not a niche, and neither is getting paid.